Work Matters

Tag: Knowing-Doing Gap

  • Dysfunctional Internal Competition at Microsoft: We’ve seen the enemy, and it is us!

    My colleague Jeff Pfeffer and I have been writing about the dysfunctional internal competition at Microsoft for a long time, going back to the chapter in The Knowing-Doing Gap (published in 2000) on "When Internal Competition Turns Friends Into Enemies."  We quoted a Microsoft engineer who complained there were incentives NOT to cooperate:

    "There are instances where a single individual may really be cranking and doing some excellent work, but not communicating…and working within the team toward implementation.  These folks may be viewed as high rated by top management… As long as the individual is bonused highly for their innovation and gutsy risk-taking only, and not on how well the team accomplishes the goal, there can be a real disconnect and the individual never really gets the message that you should keep doing great things but share them with the team so you don’t surprise them."

    And we quoted another insider who complained about the forced curve, or "stacking system:"

    This caused people to resist helping one another.  It wasn’t just that helping a colleague took time away from someone’s own work.  The forced curve meant that “Helping your fellow worker become more productive can actually hurt your chances of getting a higher bonus.”

    This downside of forced-rankings is supported by a pretty big pile of research we review in both both The Knowing-Doing Gap and in Hard Facts, and I return to a bit in Good Boss, Bad Boss.  The upshot is that when people are put in a position where they are rewarded for treating their co-worker as their enemy, all sorts of dysfunctions follow.  Forced rankings are probably OK when there is never reason to cooperate — think of competitors in a golf tournament — or perhaps when sales territories or (for truck drivers and such) routes can be designed so that people don't need to cooperate.  And there is one trick I've seen used (at GE for example) where people are ranked, but part of the ranking is based on how much they help others succeed — but people at GE have told me that forcing the firing of the bottom 10% can still create lots of problems (in fact, my understanding is that GE has softened this policy). 

      As my colleagues Jeff Pfeffer loves to say, the assumption that the bottom 10% have to go every year is really suspect — it assumes a 10% defect rate!  Imagine a manufacturing system where that was expected and acceptable:

    Well, the Microsoft stacking system is in the news again. A story by Kurt Eichenwald in coming out in Vanity Fair that bashes Microsoft in various ways, especially the "stacking system."  It is consistent with past research and reports that have been coming out of Microsoft for decades — I bet I have had a good 50 Microsoft employees complain about the stacking the system to me over the years, including one of their former heads of HR.

    The story isn't out yet, but according to Computerworld and other sources, this is among the damning quotes:

    Every current and former Microsoft employee I interviewed — every one — cited stack ranking as the most destructive process inside of Microsoft, something that drove out untold numbers of employees. 'If you were on a team of 10 people, you walked in the first day knowing that, no matter how good everyone was, 2 people were going to get a great review, 7 were going to get mediocre reviews, and 1 was going to get a terrible review,' says a former software developer. It leads to employees focusing on competing with each other rather than competing with other companies.

    To be clear, I am not opposed to pay for performance. But when unnecessary status are created, when small quantitative differences that don't matter are used to decide who is fired, anointed as a star, or treated as mediocre, and when  friends are paid to treat each others as enemies, creating the unity of effort required to run an effective organization gets mighty tough — some organizations find clever ways to get around the downsides of stacking, but some succeed despite rather than because of how they do it. 

    The late quality guru W. Edwards Deming despised force rankings.  Let's give him the last word here. Here is another little excerpt from The Knowing-Doing Gap:

    He argued that these systems require leaders to label many people as poor performers even though their work is well within the range of high quality.  Deming maintained that when people get these unfair negative evaluations, it can leave them "bitter, crushed, bruised, battered, desolate, despondent, dejected, feeling inferior, some even depressed, unfit for work for weeks after receipt of the rating, unable to comprehend why they are inferior.”

  • What Are Good Things About Having A Lousy Boss?

    I have a weird question for Work Matters readers, one I've been fretting over for a couple weeks. 

    What are some GOOD things about working for a BAD boss?

    I would love to hear your thoughts on this odd question.  Here is the story of how it came about.

    About two weeks back, I enjoyed a long dinner with a couple good friends of mine — whose names must be kept anonymous given the facts that follow.  I generally like to name names, but in this case, I will not out them and will also omit identifying information (and change a couple key descriptions) to protect both the innocent and the guilty.

    To get back to our dinner, we were among the first people at the place and the last to leave because we were having so much fun talking many different topics — why incremental innovation is sometimes under appreciated (well, not in China… and look how they are doing) and why breakthrough innovations are overqualified, how the best way to influence your spouse is through your kids rather than directly, and why the 130 proof bourbon that the bartender gave us to try was a cool idea — especially because the ice cubes sink in it — but too much like drinking lighter fluid for our tastes. 

    But this blog post is about the topic we kept coming back to, the idea that, well, bad bosses aren't all bad.  Of course, we all had suffered through bad bosses, and had seen them do all kinds of damage.  BUT — and this the thread I thought I would raise here — during the course of the conversation, we all started realizing that a bad boss — especially the kind who doesn't really have the power to hurt you very much — can be a great thing in some ways.  The notion that you can learn a lot about what NOT to do from a bad boss has been around for decades . A charming version of this argument is in Robert Towsend's classic Up The Organization, where he asserts that much of what he learned about being a good boss came from working for such awful bosses at American Express early in his career.

    The focus of our conversation about bad bosses, however, turned a different direction that I am still fretting over.  One of my friends had just ended a long stint working for a lousy boss, one who could be a selfish asshole at times and was a legendary backstabber and narcissist.  He talked about how great it was that this selfish jerk had been removed from his management job and was now working a line job again, and how his new boss was thus far amazing — selfless, open, always thinking about was good for his group rather than himself, listening all the time, practicing constant empathy. This guy could be the poster child for Good Boss, Bad Boss.

    Then, my other friend chimed in and talked about how he wished he had such a boss because his current boss was so lame.  She was inept in many ways, especially committing sins of omission: not going to meetings she should, not answering emails no matter how important, not following through on commitments, not jumping into help his team when she said she would, not having the guts to deal with performance problems, not reaching outside of the organization to develop a stronger network, and perhaps worst of all, constantly spending time planning and talking and brainstorming — but pretty much being unable or unwilling to actually get anything done.  This boss could be the poster child for The Knowing-Doing Gap.

    Then, however, the conversation took an interesting turn that still gnaws at my mind. The guy with the good boss said to the one with the bad boss "Be careful what you wish for, I got the great boss I want, and it has disadvantages."

    He went on to explain that, when he had that inept boss, he felt obligated to take only minimal steps to help his organization.  He did everything he could to avoid contact with his boss — and would never lift a finger to help that asshole succeed.  He wasn't the only one in his group who reacted that way: Alienation was high and the commitment was low throughout.  But he didn't just mess around at work. He devoted his energy to developing a big book of business and for developing a great reputation among clients.  In other words, and this is the key point, he was treated sufficiently badly by his boss (as were others), that he felt free to act largely in his self-interest.

    BUT with this new and nearly model boss, he and many of his colleagues are spending much more time working to help the organization in all sorts of ways — to recruit new people, to repair broken procedures, to attend every group meeting, to develop business that helps the organization and not necessarily themselves.  As a result, he is spending far less time doing things that benefited only him, and as a result, not only is making a bit less money, he is having less fun too. He now feels compelled to do things that he doesn't like to benefit his group and organization — because he respects and admires his boss so much, and didn't want to let him down.

    Then, we started quizzing my friend who still had the bad boss.  Our friend has become a total star in recent years.  The work his team does is bringing in a third of the group's revenue, he has freedom to do what he wants, his boss is rather afraid of him so almost never tells what to do, he is making a lot of money, and — while he is still doing many things to help his group succeed — he is far more respected both inside and outside the organization than his boss.  As my friend with the new good boss warned him, if you got your dream boss — or worse yet they gave you your bosses job — you might feel great in some ways.  But your life would change for the worse in other ways.  You would start doing more things that benefited your organization that were not in your pure self-interest, you would spend more time doing things to help others that you would rather not do, you would go to more meetings with people who are of no interest to you –and even dislike — because doing so was for the greater good.

    The conversation went back and forth in this vein for awhile, and although all three of us still believe that bad bosses suck on the whole, we started wondering if a more general, elaborate, and evidence-absed argument might be made about the upsides of working for a loser.  In this post, there are some hints:

    1. You can learn what NOT to do.

    2. If you just have ordinary competence, you look like a genius compared to your boss.

    3.  You don't feel compelled to waste time doing extra things that help your group and organization.  After all,  if they aren't doing much for you or are treating you badly (via your boss), why should you do anything to help them?

    3. Your boss is so inept at implementation that it isn't worthwhile going to meetings, generating ideas, or suggesting now paths the organization might take. None of it will happen in anyway, so why waste your time?

    4.  A lousy boss probably needs you more than a good boss — and thus you may have power — because you keep bailing him or her out, bringing in money or clients that he or she is too inept to do, and performing other competent acts that protect the boss and make the boss look better than he or she really deserves.

    5. If the boss leaves (perhaps is fired — but in too many organizations lousy bosses get promoted), and you get the job, people will think you are brilliant because of the power of psychological contrast. (I am cheating here, as this is really about an advantage of taking a position last held by a horrible boss).

    I am partly having fun here and partly serious.  Yet as we talked about the good and bad bosses my friends had, and other bosses we had known and worked for, we realized that there are some perhaps under appreciated advantages to having a bad boss.  I am not sure how far to take this, but for now, perhaps we could have some fun. Let's try a little thought exercise and look at the same thing as everyone else, but to try to see it differently.

    So, once more, I want to hear from you:

    What do you think? What are some other advantages of working for lousy boss?

  • Adopting The No Asshole Rule: Don’t Bother If The Words Are Hollow

    I just got off the phone with executives from an unnamed large company who are thinking about implementing a "no jerk rule." I am, of course, a big fan of this idea. And there are organizations that have such rules and the implement them effectively, such as Baird, the financial services firm.

    But I think they were a bit taken aback by how vehement I was about the dangers of just plastering the words everywhere, and not following it with the real work of implementing The No Asshole Rule (and, of course, this applies to any other norm in the organization… we wrote a lot about this in The Knowing-Doing Gap).  I wanted to know if the reward and prestige systems already supported the rule, and if not, how they were going to change things.  I wanted to know if the senior executives already modeled the right behavior, and if not, was something being done to make sure they changed their behavior.  I wanted to know if there were known assholes in visible positions, and if there were, was something going to be done to change their behavior or send them packing –to signal that the words were not hollow. 

    As with all norms, the espoused beliefs don't mean much unless they are backed by what people do — especially during the little moments.  Google is an interesting case in point.  Although they are imperfect like every human organization, it remains a civilized place because, as one senior executive explained to me years ago, "it isn't efficient to be an asshole here."  That is a sign to me that the norm is working, and all the strategy and product stuff aside, it is impressive they seem to have sustained this norm despite their size and the relentless performance pressures.  

    To return to the dangers of hollow rhetoric: It is especially destructive when it comes to the no jerk or or no asshole rule.  When organizations say it, but don't do it, when it does not constrain and describe how people act — and no serious efforts are being made to begin implementing the norm — the result is that double-whammy:  Leaders are seen as both assholes and hypocrites.  

  • The Better By Design Summit: Cool Things I Heard in New Zealand

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    I had the privilege of speaking at the Better By Design CEO Summit in New Zealand last week, which was a delightful event for 300 or so executives.  It was intended to spread knowledge and whip-up enthusiasm about design thinking among businesses in that lovely country.  Our master of ceremonies was the charming and astute Jeremy Moon (pictured above), who is both the Chairman of Better By Design (a New Zealand government group that develops and spreads design thinking), and is also CEO of a firm called Icebreaker, which makes very cool high-tech wool clothing.   Go here to see the line-up of speakers, here for a press report, and here for their blog.  To give you a biased take on the conference, I thought it would be fun to just list some of the cool things I heard people say, as they said a lot of fascinating things that got me thinking.  If you would like to leave a comment, let me know what especially struck you — positive or negative — and why.

    Most of these aren't exact quotes, rather they are the product of my lousy note taking.  So I apologize for any errors or misrepresentations.

    From  Marty Neumeier, author of the The Designful Company:

    Design thinking helps close the gap between knowing and doing, which I call "dragon gap:" When the old map makers wanted to represent uncharted territory, they drew pictures of dragons to represent the scary unknown.

    "We intend to keep innovating" (How Steve Jobs reportedly answered a question about how Apple plans to keep growing.)

    Design is like a sound that only dogs can hear.

    Business keeps speeding-up, but our brains aren't getting any faster.

    A wealth of information creates a paucity of attention.

    Even the lone ranger didn't work alone.

    From Dick Powell, Co-founder Seymourpowell, a UK-based design firm:

    Anthropolology before technology.

    Slow is the new fast.

    The never ending now.

    You can't make a massive change all at once.  The smartest people and companies find ways to keep winning a little bit along the way.

    From Adam Lowry, Co-founder and Chief Greens Keeper, Method Products

    Design is the first signal of human intention (quoting William McDonough)

    Design advances slowly but not gradually — there are long periods where not much happens, punctuated by periods of rapid and dramatic change.  It is like the theory of punctuated equilibrium from evolutionary biology; change happens in fits and starts, in step functions.

    Good design creates good stories.

    We got a lot of free PR, including on Jay Leno's show, for writing advertising copy claiming that our products make your stuff "fricken clean."

    We are in "a constant state of make" at Method.

    We are "people against dirty" and one of our primary challenges is to "Keep Method weird."

    When asked why Method keeps innovating, he answered "our people give a shit."

    We had over 300 SKU's in 2007; now we have about 110.

    I have a veto, but the most powerful thing I can do is to never use it."

    We would rather have a hole (an unfilled position) than an asshole at Method.

    From a panel of who described their design thinking study tour to Silicon Valley, which was composed of executives from New Zealand firms and was sponsored by Better By Design — and was led by Perry Klebahn and Diego Rodriguez:

    Think big, but make it happen step by step'

    To fail is not shameful.

    Teams that do beat teams that talk.

    I am going to get rid of my office and sit with my people.

    Keeping  and growing good people, and strengthening the culture, those are our biggest business risks.( Heard at Method and Google).

    Its hard.

    At Google, they told us "above all, we try not to hire bullies."

    We started out last and finished first in a tire changing competition — that was a wake-up call.

    We were way ahead in the tire change competition, so we started resting on our laurels and we didn't question our assumptions. So the the team that started out worst beat us in the end.  (The tire changing exercise is something I have written about here at HBR.org) 

    Alan Webber, co-founder of Fast Company, author of Rules of Thumb, and Global Detective:

     This conference keeps going back to a pair of themes I hear everyplace I go now, leadership and change.

    I went to a conference recently where two CEOs of big companies told their people, essentially, that everything will be fine, there is no need to worry.  They pretended to be for change but were really against it.

    The best changes preserve the best of what is already there and get rid of the rest. 

    If you want to change things, make hard things easier. Or raise the cost the cost of the status quo. Or do both.

    Design thinking plays important roles including serving as a problem poser, problem solver, a sensemaking tool, a source of differentiation. It also can be a source inspiration and aspiration.

    When I worked for the City of Portland, Oregon, my boss defined a strategy as anything that solves more than one problem at a time.  That was part of the philosophy that helped transform the city into one of the best places to live in U.S.

    The world is thirsty for difference.

    Design is too important to be left to designers .

    You don't have to it all in one bite (talking about change)

     Rob Fyfe, CEO of Air new Zealand, is a national hero for leading the airline from financial ruin, deep despair, and shame to a place infused pride and excellence — not just among its employees but among every New Zealander I talked to about the airline (which was dozens, as everyone from taxi drivers to teenagers brought it up).  It was just named ATW Airline of the Year, the industry's most prestigious award.

    The airline suffered from a loss of self-belief and pride.

    All the smiling people had left.

    My challenge is to bring people to life.

    It would be like going to a Greenpeace rally in a Hummer (on the challenge of claiming that an airline is green)

    We had delusions of global dominance.   Yet, in the end, we realized that all we had was our New Zealandes –  not so much the beauty of the country, but the charms and quirks of our people.

    I don't spend a lot of time on spreadsheets; I spend it  with my people or thinking about my people.  Several members of my board thought that was all wrong and I should be spending most of my time on financials, but they have come around.

    I spend a day each month doing a job on the airline — working as a flight attendant, a baggage handler, anything but a pilot!

    We use real words, not business language or jargon.  That other stuff sounds fake.

    One of our most successful campaigns featured our people "body painted;" it started with one of our pilots on a billboard and the motto is that our "staff have nothing to hide."

    This isn't meant to be a linear post that makes a clear and integrated point– rather it is a kind of like a Rorschach Test, one of those projective tests where personality and hidden conflicts are allegedly revealed when a person is asked to describe what he or she sees in abstract pictures, images, or artwork.   But I can say that the main thing I was left after the conference and my other social activities with was that the people in New Zealand are an intriguing mix of proud and modest, and competitive and cooperative, and as Diego Rodriguez pointed out, they have a can do attitude in combination with a no asshole rule.  So New Zealanders are well-suited to the design mindset and methods and are a lot of fun to work with.

    Finally, a big thanks to my hosts from Better By Design including Judith Thompson,  Vijayan Kutta, Miriam Wilkins, and Nicky Toresen.  They were fun and extremely competent — and I appreciate their tolerance of my various quirks.

     

  • NUMMI Story on This American Life

    Nummi

    I have been following the NUMMI plant (in Fremont California) in a haphazard way since it was opened as joint venture by Toyota and GM in the 1980s.  I have visited a few times and talked to lots of folks from GM, Toyota, and NUMMI since its inception.  As most of you probably know, the plant is closing on April 1.  It is just a shame for many reasons, the jobs lost, the failure of GM to learn what they should have from the joint venture, the feelings of helplessness and on and on.

    If you want to learn about the plant's history from its birth to (nearly) its death, check out the astounding episode of This American Life, a compelling tale of how it went from the worst of the worst GM plants (drug use and drinking were routine on the line, and you could buy sex in the plant — and the quality and cost numbers were awful), to how Toyota started the NUMMI plant (the only unionized Toyota plant in the country) with a workforce composed (85%) of the same people who worked at that awful plant, how they retrained them in Japan, how these same workers once put in a different system started making some of the highest quality cars in the U.S. — even the world –  from the day the plant opened, to all the twists and turns including how Toyota itself is repeating some of the same mistakes that nearly killed GM, and onto the near final sadness.

    I am a big fan of This American Life and I think this is one of their best episodes ever.  The lessons about the power of a good — versus a lousy — system are especially compelling, as is the rather pathetic tale of GM's inability to learn from NUMMI.  Their quality still trails behind most of the rest of the world now, over 25 years since the NUMMI plant opened.

    Fascinating stuff. I will start assigning this episode to my classes, there are so many great lessons and it is so emotionally compelling.