Work Matters

Tag: leadership

  • My Main Focus for 2012: Still Scaling-Up Excellence

    I thought I would provide an update about what I am working on these days, and use it to get some ideas and advice from folks who read this blog.

    2011 was a year of learning and thinking for me, which was necessary because 2010 was simply wild.  I had open heart surgery in April, Good Boss, Bad Boss was published in September, as was the paperback version of The No Asshole Rule — both of which became New York Times bestsellers.   I spent 2011 doing a lot of talking, reading, and thinking about two future projects — they are moving along, but it is always a slow process.  I am lucky to have a job where I don't have to rush to get things out before I am proud of them.

    The first project remains in the early stages.  It follows from my focus on the intersection of humanity and performance in the workplace.  I would tell you more, but it is so ill-formed that I changed my mind about the exact focus several times last year and will likely do so several more times. The one thing I can say at this point is that, when I go back to all the stories people have told me about being a boss, working for bosses, and dealing with assholes, two themes come up over and over: 1. How crucial it is for people to feel as if they are treated with dignity and respect and  2. How important it is for people to be able to stand-up for themselves and others, to create conditions that enable dignity and respect, but to do so without being an asshole.   This first project may take years to reach fruition as my main focus now is on the second project — which fits with my other work on innovation and organizational change.

    My Stanford colleague Huggy Rao and I have been reading about, talking about and studying "scaling" for several years now — the challenge of spreading and sustaining actions and mindsets across organizations and networks of people — of spreading excellence or goodness from the few to the many.  This was my primary focus last year and will continue to be in 2012.  Huggy and I are now making serious progress on a book that digs into the topic.

    Every book has a life of its own. This one took awhile to get moving, but it is now dominating our lives.  We seem to be in constant conversation with managers and executives from all kinds of industries about the topic (e.g., in recent weeks we've talked to executives from high tech firms, banks, and the hotel industry; administrators who run prisons; leaders of a big beer company; and school administrators — this week we are swimming in founders of start-ups), we are teaching a fun and somewhat crazy class with 60 MBA and engineers on scaling-up excellence this term (I will blog more about this in the coming weeks), and the text for the book is now pouring out of our computers slowly but steadily.

    Last year, HBR provided summaries of projects that a host of of business and management leaders would be taking on in 2011 — including me.  The perspective Huggy and I are developing has become more refined and our ideas are now much sharper.  But the  "agenda" piece I wrote about a year ago still captures what we are trying to do pretty well. 

    I said our goal was to finish the book in 2011. That didn't happen, but I am optimistic it will this year as we are moving along at a healthy clip. I repeat that description of our project completely (along with comments from the earlier version of this post, published here last year).  We would love any additional comments, suggestions, examples, or other ideas you have:

    My Stanford Business School colleague Hayagreeva Rao and I are absorbed by why behavior spreads—within and between organizations, across networks of people, and in the marketplace. We've been reviewing academic research and theory on everything from the psychology of influence to social movements to how and why insects and fish swarm.

    We are also doing case studies. We're documenting Mozilla's methods for spreading Firefox (its open-source web browser); the Institute for Healthcare Improvement's "100,000 Lives" campaign (an apparently successful effort to eliminate 100,000 preventable deaths in U.S. hospitals); the spread of microbrewing in the United States; an organizational change and efficiency movement within Wyeth Pharmaceuticals (now part of Pfizer); and the scaling of employee engagement at JetBlue Airways. And we're examining case studies by others, including the failure of the Segway to scale and the challenges faced by Starbucks as a result of scaling too fast and too far.

    Our goal is to write a book in 2011 that provides useful principles for managers, entrepreneurs, and anyone else who wants to scale constructive behavior. Because we are in the messy middle, I can't tell how the story will end. But we believe we're making progress, and we're excited about a few lines of thought.

    The first is the link between beliefs and behavior. A truism of organizational change is that if you change people's minds, their behavior will follow. Psychological research on attitude change shows this is a half-truth (albeit a useful one); there is a lot of evidence that if you get people to change their actions, their hearts and minds will follow.

    The second theme is "hot emotions and cool solutions." As Rao shows in his research on social movements, a hallmark of ideas that scale is that leaders first create "hot" emotions to fire up attention, motivation, and often righteous anger. Then they provide "cool," rational solutions for people to implement. In the 100,000 Lives campaign, for example, hot emotions were stirred up by a heart-wrenching speech at the kickoff conference. The patient-safety activist Sorrel King described how her 18-month-old daughter, Josie, had died at Johns Hopkins Hospital as the result of a series of preventable medical errors. Her speech set the stage for IHI staffers to press hospitals to implement six sets of simple, evidence-based practices that would prevent deaths.

    The third is what we call the ergonomics of scaling—the notion that when behaviors scale, it is partly because they've been made easy, with the bother of engaging in them removed. In developing Firefox in the early days, Mozilla's 15 or so employees were able to compete against monstrous Microsoft (and produce a browser with fewer bugs than Internet Explorer) by dividing up the chores and using a technology that made it easy for more than 10,000 emotionally committed volunteers to do "bug catching" in the code. Mozilla now has more than 500 employees, but it is still minuscule compared with Microsoft, and those bug catchers are still hard at work every night.

    Again, we would love to hear your ideas:  Cases we should dig into, research on scaling and organizational change we should know about, and methods you've used in your organization to scale good behavior and descale bad. We would love to hear it all.

  • Chip Conley’s Emotional Equations: A Leadership Self-help Book You Will Love (Even If You Hate Self-help Books)

    Emotional_book-500x500

    Chip Conley is an astoundingly talented human-being, and for me, the very model of a CEO who built an organization that strikes a  balance between performance and humanity, or as IDEO's David Kelley puts it, between love and money. Shortly after graduating from the Stanford Business School, at the age of 26, he started a  25 year quest to build what has become one of America's most successful boutique hotel chains, Joie de Vivre.  It is now some 40 hotels strong — and each property has its own personality from very first in the chain, the rock and roll themed Pheonix in San Francisco to the upscale and rugged beautiful Ventana Inn located in Big Sur, California.  

    I've been lucky enough to get to know to Chip a bit over the past year, and have been struck repeatedly with his rare blend of emotionally sensitivity, business acumen, creativity, and generosity. Last week, we had Chip as a guest at the class on Scaling-Up Excellencee that Huggy Rao and I are teaching this term to business and engineering students at Stanford.  Chip's stories about the method that he uses to develop a distinct brand identity for each property grabbed everyone in the room: They start by picking the magazine that best represents the experience that they want to design for guests, and then develop five words to summarize the feelings that go with it, and then design to that image.  So, at the Phoenix, The Rolling Stone was the magazine they choose; for a more recent property (The Hotel Rex, I think), they choose The New Yorker.  As Chip explained, this simple early choice helps guides hundreds of decisions about everything from the target market for the hotel to the kinds of unexpected delights they offer guests. 

    Chip blends this creative capitalism with impressive compassion and caring for his staff.  I was most impressed when he reported that, after September 11 2001 when the hotel business was under siege, especially his hotels (in part, because of the French name — he got a lot hate mail), rather than shutting hotels and doing layoffs, Chip and his top team decided to take the financial hit themselves and to protect their people the best they could.  Indeed, while his top team top a huge cut, and Chip took a "salary sabbatical" for three years, not a single person was laid-off for lack of work.  Now that is having people's backs!  And much like when Ed Catmull and Alvy Ray Smith defended their people during trying times, the resulting trust, loyalty, and psychologically safety has fueled the growth and spirit of the company.  Chip is still heavily involved in chain, opening new properties and he still has a financial stake, but he sold a majority share of the company a couple years back and is now focused on writing wonderful books and speaking (he is one of the best speakers I've ever seen, if you get a chance, go and see him).  Indeed, Chip started cranking out books when he was still CEO (a tough thing to do). with his most notable past book being Peak: How Great Companies Get Their Mojo From Maslow.

    The main reason I am writing this post is to point you to his new book, Emotional Equations: Simple Truths for Creating Happiness + Success. I am not sure I have ever seen a book quite like this, as I could not decide if it was business book or a self-help book when I started reading it. Ultimately, I realized it is both, and for Chip, dealing with and channelling his emotions is the key to his success as a leader and mentor and crucial to whether he travels through his days feeling or bad about himself. 

    Chip makes a mighty strong case — using stories, dabs of research, and the lovely simply equations that fill the book — to argue there are general principles that we can apply to ourselves and others to be better leaders and humans.   Chip sees himself as "your emotional concierge" and the book as an "operating manual for being a super human being." He doesn't mean becoming superhuman, to him, that is a dangerous goal; rather, he means not allowing your emotions to get the best of you and instead finding ways  "your emotions can represent the best in you."

    Chip then presents a series of simply emotional equations and associated stories and advice, things like

    Despair = Suffering – meaning

    Happiness = Wanting What You Have/Having What You Want

    Regret = Disappointment + Responsibility (think about that one)

    Authenticity = Self-Awareness x Courage

    Wisdom = The Square Root of Experience

    I know, it seems silly on the surface.  I frankly hesitated to read the book because I hate self-help books (being a psychology major for 10 years has made me cynical about them).  Despite that, I just couldn't resist once I started reading the thing.  The way that Chip frames these formulas, links them to the daily struggles every leader –  and every other person — faces as they try to navigate through life, is done in such a compelling and helpful way that the result is the kind of read  (and a weird from of useful therapy) that simply doesn't exist in any book I know.  I am not the only one who is enjoying this book — it is already on The New York Times bestseller list.

    In the name of full disclosure, I did grow-up in California and I am a big fan of Chip's; but anyone who knows me will tell you I am the least "new age' guy you will ever meet.  So you might be as surprised as I was by how instructive and comforting it was to read Chip's delightful and quirky book.

    P.S. If you want a fun and quite accurate summary of the book's main idea, check out this "book trailer."

  • New CEO Studies: Nuances of Narcissism, Flattery, and Opinion Conformity

    ASQ CoverI got my copy of the Administrative Science Quarterly in the mail the other day. You can see the cover to the left, it is famous for pretty pictures like this one by Signe Pike, whose mother Linda Johanson is the managing editor (and has been for at least 30 years I can recall).  I was one of two associate editors for four years in the 90's and, although I liked doing it in many ways because the work was challenging and I especially liked working with Linda, the weight of having to write over 100 decision letters a year on papers (which would be sent out for evaluation by three anonymous peers first) eventually wore me down. 

    Academia is petty and I can be touchy, so I got especially tired of the hostility from people who got papers rejected as many academics have big egos and turn hostile in the face of rejection (ASQ is the most prestigious organizational research journal and rejects over 90% of papers submitted.   It is so picky that it has been running late for years — note the June 2011 issue just came out this week.  But the quality is always very high.).  There is even one author who is still mad at me because some 15 years later because, even though we accepted his paper, we wouldn't let him publish it until he fixed his lousy writing.   I never thought I would be teaching freshman English to an Ivy League professor, but he needed it.

    The journal has been in good hands in recent years, with the last editor being my scaling co-author Huggy Rao from Stanford and the new editor being Gerald Davis from  The University of Michigan (who I worked with when he was a Stanford student 20 years ago or so). 

    Perhaps because I had just wrapped-up a doctoral seminar on leadership, there were two articles that really caught my eye.  I wasn't shocked by the findings, and you likely won't be either, but was pleased with the rigor.  The three studies from two articles were done in different ways, but the upshot is that CEOs are swayed heavily by praise and ass-kissing of all kinds, especially narcissists, and the effects aren't pretty. In short:

    If you are a CEO, these studies show how hard it is for you to wade through and tune out all the bullshit and ass-kissing that come with the job.  Those flattering stories that the press wants to write about you are dangerous to your organization's health — especially if you are narcissist, but even you are not. And all that insincere ass-kissing and agreement from your board and your management team may help them get ahead, but can hurt you and your company. It can fuel an inflated self-assessment of your skills, cause you to cling to failing strategies, hurt your firm's long-term performance, and cost you your job.

    I offer more details about these studies if you want to learn more; if all you want is the headline, I suggest you stop here.

    The first was by Arijit Chatteerjee and Donald Hambrick, which compares highly narcissistic CEOs to to their less narcissistic peers in two studies. The first was a sample of 152 CEOs from 134 computer hardware and software firms.  I loved their measures of narcissism: how prominently the CEO was pictured in the annual report; the number of times the CEO's name was mentioned in the typical press release; and the difference in compensation (both cash and non-cash) between the CEO and the next highest paid executives.  They argue this measure is reliable and valid because these items were fairly highly inter-correlated (.71 was the Cronbach's alpha for measurement geeks) and they also had a panel of experienced security analysts rank 40 of the CEOs in terms of narcissism, which further supported their ranking method.  

    The findings of this first study focus on how narcissism appears to serve as a filter for outside cues.  The highly narcissistic CEOs were less responsive to whether recent firm performance was good or bad — they tended to continue to make equally risky investments (more risk was indicated by spending more money on R&D, big capital expenditures, and acquisitions of new companies) regardless of recent performance.   In contrast, their less narcissistic peers became more cautious in bad times and tended to take bigger risks during good times.  The most interesting finding was about media praise.  The less narcissistic CEO's weren't affected much by media praise, but the highly narcissistic ones tended to make considerably riskier investments after getting praised in the media.

    So the upshot is the narcissists were swayed more  by "social praise" and less by recent performance!

    Their second study dug into something called "acquisition premiums," the well-documented tendency for companies to overpay when they buy another company.  This was measured by comparing the acquired company's stock price four weeks before the acquisition was announced to what it was finally sold for.  The authors used a different sample of 131 big acquisitions (over 100 million) across diverse industries, and measured narcissism the same way as in the first study.  They found some interesting parallels to the first study: Recent media praise tended to have a stronger effect on the acquisition premiums paid by highly narcissistic CEOs.  A single flattering article was associated with paying a 7% larger  premium among the less narcissistic  CEOs (28% versus 35%) and a 14% premium (29% versus 43%) among the highly narcissistic CEOs.

    In short, this research suggests that most companies pay big acquisition premiums, that recent media praise makes it even worse for all CEOs, and especially worse for narcissists.

    The second article, which I will describe more briefly, is by Sun Hyun Park, James Westphal, and Ithai Stern. It looked at the impact suffered by CEOs who are surrounded by people who engage in (relatively) more intense and frequent flattery (e.g., offering exaggerated compliments) and opinion conformity (e.g., expressing agreement even when they don't quite agree) as measured by surveys of their board members and top managers.  These very persistent researchers managed to gather these kinds of data about 451 CEOS.  The findings probably won't surprise you much:

    More flattery and opinion conformity was linked to CEOs having more favorable evaluations of their own strategic judgments and leadership skills, being less likely to make strategic changes when firm performance suffered (just like the narcissists in the first study), and more to prone to lead firms that suffered persistently poor performance.  The authors also present suggestive evidence that flattery helps bring down CEOs in the end, that it not only is linked to weaker long-term firm performance, it increases the chances that those very same ass-kissing board members are going to fire the CEO when things turn south.

    James Westphal and his colleagues have published many studies like this one that show how the social psychology of CEOs, boards, and top teams color their behavior in often discouraging ways.  For example, an earlier study by these folks suggests that engaging in flattery is a smart personal strategy for board members want to gain additional lucrative appointments, as ass-kissing is associated with getting more board memberships — especially for white males, but not so much for women and minorities!

    As I said at the outset, none of this will likely surprise you.  But it adds further fuel for skeptics who argue that CEOs are at least as irrational as the rest of us. 

    Taken together, this research provides lots of evidence about how boards and top management teams ought to act when selecting and dealing with CEOS and about the hazards that  CEOs face — and hints about why it is so hard for both CEOs and those who oversee them to do the right things.  The headline for me is that praise and flattery often benefit those who provide it, but can be dangerous to those who recieve it.

  • Inside Apple: Adam Lashinsky Revealing and Well-Crafted Book

    LASHINSKY_Inside Apple_HCLast week, I opened up my copy of Adam Lashinsky's new book, Inside Apple.   It was about 8 at night, and I figured I would read the first chapter and do something else.  Well, I looked-up, and it was 1:30 in the morning, and the book was done.  Frankly, a business book hasn't grabbed me like that in a long-time.   Adam not only writes well, he provides the most complete picture you can find of how Apple actually is organized, how they divide-up the work, the pecking order, the mindset — the kind of stuff that people like me who are interested in organizations want to know.

    This is not an authorized book like Isaacson''s blockbuster Steve Jobs.  But Adam has been following Apple for many years as a reporter at Fortune, and before that, at the San Jose Mercury. He did many interviews with former Apple employees, and although it is unclear how much access that Apple allowed him (and knowing Apple, he likely isn't allowed to say), I can tell you that I've talked to several journalists over the years who have complained that he gets better access than the rest of them. He also does a great job of capturing the complexity and hypocrisy of the place.  I especially loved this paragraph late in the book, on page 175:

    Apple is company of paradoxes. Its people and institutional bearing are off-the-charts-arrogant, yet at the same time, they are genuinely fearful of what would happen if their big bets go bad.  The creative side of the business that was dominated by Steve Jobs is made up of lifers or near lifers who value only an Apple way of doing things — hardly the typical creative mind-set. The operations side of Apple runs like any company in America, but better, and is led by a cadre of ex-IBMers, the cultural antithesis of Apple.  Apple has an entrepreneurial flare yet keeps people in a tightly controlled box, following time-tested procedures. Its public image, at least seen through its advertising, is whimsical and fun, yet its internal demeanor is cheerless and nose-to-the grindstone.

    Good stuff, huh? I was interested in Adam's opening arguments that Job's was a productive narcissist, which he linked to Michael Maccoby's Narcissistic Leaders and to The No Asshole Rule a bit too.  Many other things about the book were interesting, but three especially stood out for me, and reinforced my beliefs (and now some concerns) that I voiced in my post last year 5 Warning Signs to Watch for at Apple:

    1.  Apple is nearly the exact opposite of the kind of organization hyped by people like Gary Hamel and even Peter Drucker.  It is centralized, secretive, fear-ridden, punitive, and not much fun for most people who work there.  But it works because the pieces of the "organizational design" fit together, or at least did fit together when Jobs was there, in an elegant way.  The secrecy is so severe that, when products are launched, even senior people are surprised by the final product because people are on a strictly "need to know" basis.  But this is offset with a system of roles and responsibilities — and crucial to all of it– is what Apple calls the DRI, the directly responsible individual, a centerpiece of the organization.  There is clear responsibility placed on individuals, not so much on groups and committees.  Although groups and some committees do exist, the DRI can always be found and is where attention is focused.  Which means that that it is clear where to go to provide guidance, to integrate their work with others, and who will be fired, blamed, and replaced — and celebrated too. 

    Essentially, and you can see this in the organization chart on one of the first pages of the book, Apple is designed so that all major (and many minor) decisions are made by a very small group of people, they are not influenced much by suppliers, customers, 99.9% of employees or anyone else; rather is what my friend John Lilly calls a "genius driven" organization.  So, with Jobs gone, the question on the table is if the brilliance of CEO Tim Cook and a few others like Jonathan Ive (head of design) and Scott Forstall (head of IOS software) can sustain the firm's dominance and creativity. These are mighty smart people and they have been slowly weaned from Jobs as he was so sick for so many years.  But the design of the organization places more pressure on senior executives doing the right things than any large company I know.

    In contrast, other organizations have decentralized systems where numerous semi-autonomous businesses are responsible for their own profits and losses, and top executives are essentially managing a portfolio.  HP operated quite successfully this way for decades under Hewlett and Packard.  The had numerous divisions (I recall about 45 when I first got to Stanford in 1983), and it was run by what some insiders called the "mafia model:" if  your business was sufficiently profitable (around 10% net profit per year as the going rate as I recall), you simply paid that "protection money" to  corporate, and you could do whatever you wanted within reason.  If your numbers were lower, you would get "help," and if they didn't improve or if senior management lost faith in you, you were removed.  Certainly, this kind of structure places pressure on leaders to prune, merge, and start new businesses –and to deal with overlaps and conflicts between businesses — but such a structure spreads the leadership chores — and risk — among multiple teams, each of which acts with great autonomy.  (Google is much more decentralized than Apple, for example, but is moving to become more centralized.  For example, when Larry Page took over as CEO, they had so many products done by so many different decentralized groups he went to Wikipedia to get a list of them all–and then he and his team started trimming them).

    My point here, and this follows an old conceptual perspective called "contingency theory," is that other organizations that want to be like Apple –and that seems like so many now — need to be especially careful about copying individual pieces, because the reason it works is that the multiple elements fit together. 

    2.  I am very impressed with how thoughtful Apple's team is about allowing people to focus on what they are doing, and to not be distracted by so many of the other things that most organizations expect from their people. They don't believe in the concept of general managers.  They don't give groups or businesses P&L's… there is only one, that is for the whole company.  They focus on saying "no."   As Adam quotes Jobs, his "Focus is not saying yes. It is saying no to really great ideas."  This "elegance is refusal" philosophy is extended to strategy and organizational design as well.  There are simply a lot things that weigh on many managers and employees at other places that aren't present or are less present at Apple.  Managers aren't asked to be responsible for a local P&L, they know amazingly little about what is going on in other parts of the company, they aren't asked to go to as many meetings or be on as many committees and are instead expected to do what they do perfectly and as little else as possible. 

    This focus on simplicity and reduction of load is also seen in the emphasis on keeping teams as small as possible. The tendency to make teams ever bigger is an awful disease, not so much because it costs more money, but because, as Harvard's J.Richard Hackman has shown, it slows teams and undermines their performance as members end-up spending more time dealing with coordination issues and coalitional battles and less time doing the work at hand.  Apple gets the importance of small teams at all levels (e.g., Adam reports that a 2 person team "wrote the code for converting Apple's Safari browser for the iPad, a massive undertaking”).  They also have an unusually small board of directors — seven members — for a company of that size.  

    This extension of the elegance philosophy beyond their products has huge advantages as the "signal to noise" ratio appears to be quite impressive at all levels and in all functions — people tend to get good information, the information they need (and no more), and aren't confused or distracted by other things.  At senior levels, this means they get the information they need and it means that, although there is discussion and debate at times, when a decision is made, there is less of the usual arguing or undermining.    And if there are failures in implementing, you will be forgiven if senior executives believe you acted intelligently enough and hard enough, but you will be shown the door very quickly if they believe you were dumb or lazy.

    3.  Adam did a great job of describing the company with all its warts and negative side-effects.  I was struck by how Apple is a place that is driven by the pride of doing great work, that it was not about having fun.  That it is was also not about getting rich for most employees. Apple pays competitive salaries for Silicon Valley,  but not at the very top of the market like NetFllix.  And only a few employees who were in early made big fortunes from the stock.  In fact, Jobs hated talking about money.

     My personal reaction, and others no doubt have different motivations and preferences, is that it would be an awful place to work.  The extreme secrecy means there is extreme paranoia.  It means you often don't even know a lot of co-workers, let alone what they are working on — and if you ask them, you can get in big trouble.  Fear is everywhere.  Apple seems to take pleasure in pushing around other companies — competitors, suppliers, and those that just get in the way — just because it can.  And, let's face it, while Jobs was one of the most effective assholes in history, he was still an asshole (Isaacson reported he went through over 70 nurses before finding 3 he liked).   I worry that the bully worship that has emerged in the wake of Jobs death has not only apparently been long institutionalized at Apple, it is now being imitated and gloried by people who lack Jobs' obsessive genius and who are not embedded in an a system that is designed to amplify the best qualities of a obsessive perfectionist and to dampen the worst.

    Jobs said the journey is the reward, a nice sentiment, and I like the pride, thirst for excellence, and action orientation that Adam describes, but spending my days deep in fear, paranoia, and secrecy isn't for me. Life is too short.

    In any case, if you can't get a job at Apple or don't want to, Inside Apple provides the best — most complete and balanced — coverage of how the place works, the elements you might want to copy, and those that you might avoid — that Apple has apparently succeeded DESPITE rather BECAUSE they are used. 

  • Taking People With You By David Novak: Great Read and Most Useful

    Taking_people_with_you_coverMost books by sitting CEOs seem like they are pure fluff pieces, or worse, pure vanity projects.   As such, when I was contacted by a Penguin publicist about having a chat with David Novak, CEO of YUM! Brands about his new book, Taking People With You, I jumped at the chance to talk with him because he is so experienced and successful at scaling –Yum Brands! includes Taco Bell, Pizza Hut, and KFC — which what Huggy Rao and I are currently studying.  But I didn't expect much from the book. To my surprise, after spending a good hour and half with the book in anticipation of the conversation, I was stunned by how good it is — Novak really digs into the details of what he does to sustain, grow, and keep improving this huge company, and how any boss can learn from what he and his colleagues do.  

    The reason the book rises above most others of the genre is that it is based on a program that Mr. Novak teaches himself about eight times a year to people at YUM!, which is also called Taking People With You.  This book is based on that program, so it contains many of the specifics from this program, which as he told me, he has refined over the years as he teaches it about 8 times a year and, so far, it has involved about 4000 people from YUM! The three overall sections are: Get Your Mindset Right, Have a Plan: Strategy, Structure, and Culture, and Follow Through to Get Results.   These headlines are typical, and certainly not original, but once I started digging into how the book deals with them, I was very impressed with the detail, and specific suggestions, and how each chapter contains such specific and useful tools. Consider a few "picture step-by-step change," "choose powerful versus limiting mindsets," "get to know people," "get whole brained," and there are self-assessment tools throughout.   I argued in Good Boss, Bad Boss that the key to effective leadership, and one of the hardest things for any leader to achieve is self-awareness, knowledge of ones strengths and weaknesses and being in tune with what it feels like to work for you.  Taking People With You impressed me so much because it shows how to become more self-aware as a leader, and spotlights the specific skills that every leader needs to be effective.

    As for Mr Novak, I found him quite delightful, straightforward, and most efficient.  I was especially struck with a few things he emphasized. First, when I asked him how he spent his time, he answered that developing great leaders in the company was his number one priority.  Unlike so many companies who turn this responsibility over to professional trainers or worse yet outside vendors, Mr. Novak has developed and taught the Taking People With You workshop himself to 4000 people, and is now "cascading" it so his senior executives will teach it to others as well, so the plan is to touch 35,000 people in the company. 

    Second, when I asked him about bad behavior (as readers of this blog know, I have written quite a bit about how "bad is stronger than good"),  he had a great line, something like: "We are a company that believes in recognition, and that means recognizing both good and bad behavior."  When I asked for an example, he said that YUM! "is not the place for you if you think that you are better than everyone else."  He argued this is especially important to the company, because if managers and leaders see themselves as better than the people who work in their stores or better than their customers, then it undermines their ability to understand customer's and employee's motivations and needs, and it causes them to keep their distance from people they should be interacting with and listening carefully to every day.  (Note I was especially struck by this because I am reading Adam Lashinsky's wonderful new book Inside Apple, which certainly is a different culture, as it Apple appears to be a place where people are more or less required to think of themselves as better than others.  I will write something on Inside Apple  later in the week.)

    Third, Mr. Novak also had some interesting thoughts on what he called "the tensions between centralization decentralization," and he argued that one of the keys to YUM!'s success — which is doing incredibly well in China and other international markets — is that, while there are multiple non-negotiable elements of the culture (I like "Be Restaurant and Customer Maniacs… Now!), they err on the side of decentralization. He emphasized this meant that in places like China and India, the country team is made-up of mostly locals who understand the culture and it meant customizing menus for local tastes such as selling more desserts in France and having more vegetarian choices in India. I was quite interested to hear him talk about this approach, because as we are studying scaling, this tension between having a core set of principles and a shared mindset in concert with the need to give people enough decision-making power to adapt to local conditions is something that comes up again and again, whether we talk to someone like David who is opening thousands of restaurants in China or a chef in San Francisco who has just opened his second restaurant that is in a much different neighborhood than the first.

    Once again, Taking People With You with is a good read and is especially impressive because it is the rare leadership book that contains specific steps you can take to become more aware and more skilled at your craft.

  • Why Bosses Who are Civilized and Caring, But Incompetent, can be Really Horrible

    GoodBoss_pb3

    I haven't been blogging much the last couple weeks because, in addition to the usual madness that goes with the holiday and start of the term, I have been wrapping up a new chapter for the Good Boss, Bad Boss paperback, which will appears March 15th (but I suspect will be shipping before that, Amazon usually does).  Above is the new cover, which I quite like because it stands out and is now more distinct from The No Asshole Rule. 

    I had planned to write just a few pages for the Epilogue, but once I took the time to think about what I had learned since Good Boss, Bad Boss was published, I became rather obsessed and wrote a lot of text.  As my editor Rick Wolff wisely advised, I trimmed back the original draft quite a bit, but it still runs about 8,000 words. The opening looks back on the experience and devotes special attention to Luiz Uruza, the boss of the trapped Chilean miners (who I first wrote about at Psychology Today.)  and was interviewed about on CNN International.  I then present new nine lessons I've learned or come to believe in more strongly about what it takes to be a great boss. 

    To give you a taste, I thought you might like to see the fourth lesson (warning, this will be copy-edited, so it may read slightly different when it is published, but the point will remain the same):

    4.  Bosses who are civilized and caring, but incompetent, can be really horrible.

    Perhaps because I am the author of The No Asshole Rule, I kept running into people – journalists, employees, project managers, even a few CEOs – who picked a fight with me: They would argue that good bosses are more than caring human-beings; they make sure the job gets done.  I responded by expressing agreement and pointing out this book defines a good boss as one who drives performance and treats people humanely.   Yet, as I started digging into the experiences that drove my critics to raise this point – and thought about some lousy bosses – I realized I hadn’t placed enough emphasis on the damage done, as one put it, by “a really incompetent, but really nice, boss.” 

    As The No Asshole Rule shows, if you are a boss who is a certified jerk, you may be able to maintain your position so long as your charges keep performing at impressive levels.  I warned, however, that your enemies are lying in wait, and once you slip-up, you are likely to be pushed aside with stunning speed. 

    In contrast, one reason that baseball coach Leo Durocher’s famous saying “nice guys finish last” sometimes right is that, when a boss is adored by followers (and peers and superiors too) they often can’t bring themselves to bad-mouth, let alone fire or demote, that lovely person.  People may love that crummy boss so much they constantly excuse, or don’t even notice, clear signs of incompetence. For example, there is one senior executive I know who is utterly lacking in the necessary skills or thirst for excellence his job requires.  He communicates poorly (he rarely returns even important emails and devotes little attention to developing the network of partners his organization needs), lacks the courage to confront — let alone fire — destructive employees, and there are multiple signs his organization’s reputation is slipping. But he is such a lovely person, so caring and so empathetic, that his superiors can’t bring themselves to fire him.

    There are two lessons here.  The first is for bosses.  If you are well-liked, civilized, and caring, your charms provide protective armor when things go wrong.  Your superiors are likely to give you the benefit of the doubt as well as second and third chances – sometimes even if you are incompetent.  I would add, however, that if you are a truly crummy boss – but care as much for others as they do for you — stepping aside is the noble thing to do. The second lesson is for those who oversee lovable losers.   Doing the dirty work with such bosses is distasteful. But if rehabilitation has failed — or things are falling apart too fast to risk it — the time has come to hit the delete button.

    I'd love to hear your thoughts. Do you agree? What did I leave out?  How do you deal with one?  And, following my recent post, are the advantages to working for one of these lovable losers?

  • 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?

  • Strategy & Business Lists Hard Facts Among Decade’s 10 Most Significant Books

    Strategy and Business just released a list of the 10 "most significant books" published between 2001 and 2010.  They looked back and selected one book for each year.   I am pleased to announce that, for 2006, they picked the book that Jeff Pfeffer and I wrote about evidence-management.  Here is what they said:

    2006
    Hard Facts, Dangerous Half-Truths, and Total Nonsense: Profiting from Evidence-Based Management, by Jeffrey Pfeffer and Robert I. Sutton (Harvard Business School Press). By explaining the causes of common managerial errors (casual benchmarking, repeating what worked in the past, and following unexamined ideologies), Pfeffer and Sutton pointed the way to better decision making.

    Jeff and I are delighted the selection; we believe that, although some organizations are making progress toward using evidence rather than making bad gut decisions, doing what they have always done, or mindlessly imitating seemingly successful organizations, that our workplaces would be far more effective if decision-makers made a commitment to using evidence-based practices when possible, especially when making important decisions (unfortunately, they seem to do the opposite too often).  

    If you want to listen to a fun interview about the power of evidence-based management, check out the recent Planet Money interview with Harrah's CEO Gary Lovemen, who we talk about a lot in Hard Facts. It starts out with a quote/joke from Gary that also appears in our book, something like "There are three ways to get fired at Harrah's: Stealing, sexual harassment, and not having a control group."  Although he is joking a bit, taking an evidence-based approach has given Harrah's a huge competitive advantage.

    Here is the rest of the list.  You can read about each in more detail here in the original story.

    2001
    Good to Great: Why Some Companies Make the Leap…and Others Don’t, by Jim Collins 

    2002
    Execution: The Discipline of Getting Things Done, by Larry Bossidy and Ram Charan

    2003
    Who Says Elephants Can’t Dance? Inside IBM’s Historic Turnaround, by Louis V. Gerstner Jr

    2004
     Changing Minds: The Art and Science of Changing Our Own and Other People’s Minds, by Howard Gardner

    2005
    The Fortune at the Bottom of the Pyramid: Eradicating Poverty through Profits, by C.K. Prahalad

    2007
    Prophet of Innovation: Joseph Schumpeter and Creative Destruction, by Thomas K. McCraw

    2008
    Redefining Global Strategy: Crossing Borders in a World Where Differences Still Matter, by Pankaj Ghemawat

    2009
    Managing, by Henry Mintzberg (Berrett-Koehler). The iconoclastic Canadian professor made the best case of his career for a more holistic, humane view of managing, which he convincingly declares is as much art as science. 2010

    2010
    Chasing Stars: The Myth of Talent and the Portability of Performance, by Boris Groysberg

    We are honored to be included in such a great group.  Of this list, my favorite three are probably "Who Says Elephants Can't Dance," "Prophet of Innovation," and "Chasing Stars." My candidates for the best books of 2011 are The Progress Principle and, because of impact, Steve Jobs of course.

  • Wisdom from Stanford’s Jim March on the Numbing Effect of Business Schools

    There is a great interview on leadership with Jim March (probably the most prestigious living organizational theorist) by Joel Podolny (current head of HR at Apple, but also a very accomplished academic researcher) in the current edition of the Academy of Management Learning and Eduction journal (Vol. 10, No. 3, 502–506.)  The link is here, but someone will likely make you buy it. 

    March, as always, looks at things differently than the rest of us.  For example, he does a lovely job of arguing — using historical figures like Aristotle and Alexander the Great — that the time frames used in most leadership research are often too short to be useful.  But what really caught my eye was a line that reminded me of that old Pink Floyd song :

            We don't need no education. We don't need no thought control.

    March laments on page 503 :

    My experience with business school students is that those who possess an instinct for joy, passion, and beauty often learn to suppress their expression by virtue of a sense that such instincts are unwelcome both in business schools and in business, thereby making the sense self-confirming.

    I found this depressingly accurate for too many students, who often seem to lose their spark.  It doesn't just happen in business schools, to be clear, it is a danger in any school or institution that has strong norms, where people are in close physical proximity, and they have a lot of contact with each other (Indeed, Apple especially needs to guard against this now).  I do believe that the d.school — at least at its best — sometimes serves as a countervailing force, as the best teachers and classes there do encourage joy and self-expression.  But as much as I love being a professor, I do think that Jim raises an implicit question that every educator needs to keep asking him or herself:

    "What am I teaching my students? Am I teaching them to think for themselves and to be themselves? Or am I teaching them to a perfect imitation of each other, or of some other idealized and emotionally cold model of humanity?" 

    I am not saying that conformity is all bad, but too often we teach it unwittingly. I am curious about your reactions to March's point.  Is he (and I guess me) too hard on the educational process?  What can be done to educate people without turning them into emotionally repressed and joyless clones?

    P.S. BY the way, after I posted it, I realized that March's comment actually is another example of the issue I raised in my last post about how roles can change what do and believe so much.

  • Is It Sometimes Rational to Select Leaders Randomly? A Cool Old Study

    This term at Stanford, I am teaching a doctoral seminar on leadership.  Of course, this one of the broadest and most confusing topics on earth.  I am not qualified to teach a seminar on love or religion; so, for me, this is the most vexing topic I can teach.  The topic for the first meeting was "cynicism."  I started out by assigning academic papers that brought evidence and perspectives that undermined conventional assumptions about leadership and that even questioned why scholars bothered to study the topic at all (my friend and co-author Jeff Pfeffer raised this question in a 1977 paper called "The Ambiguity of Leadership").

    The most entertaining paper we read was by S. Alexander Haslam and a long list of coauthors, called  "Inspecting the emperor's clothes: evidence that random selection of leaders can enhance group performance" (Group Dynamics: Theory, Research, and Practice, Vol. 2, No. 3, 1998, pp. 168-184).  The two key studies in the paper entailed assigning student groups to play various versions of the "survival exercise" (see some of the variations here), where the group imagines that they have experienced some kind of disaster and are stranded (a plane crash, a broken car in the desert, and a nuclear war were used in these studies).  The group's task is to rank order the importance of a dozen or so items that might help them survive the ordeal (e.g., a compass, map,  loaded pistol, newspapers, cigarette lighter).  The performance of the group is determined by comparing their rank-ordering to those produced by experts.  This is, of course, just a simulation of reality.  But I've participated and led these exercises and they are quite engaging — I suspect many of you have had similar experiences. 

    Overall, the researchers compared the performance of these student groups under four conditions:

    1.  A leader selected via a formal selection process (self-ratings by group members)

    2. A leader selected by an informal process (group members had a discussion and picked a leader)

    3. A leader who was randomly selected.

    4. No leader selected. 

    The consistent finding was that groups with RANDOMLY selected members performed significantly better than groups in all other conditions, and there weren't significant differences found between the other conditions.  The researchers also did some follow-up surveys, and revealed some mildly interesting findings; notably, groups with randomly selected leaders rated their leaders as LESS effective even though their performance was BETTER.

    The authors assert that this rather surprising finding — which was fairly strong and replicated across two (albeit modest) studies — occurs because performance on this task requires cooperation, input, and effort from all group members.  They suggest that the very act of selecting one individual, of singling him or her out as better than the rest or simply focusing attention on that person, undermines the group's sense of unity and shared identity. They suggest that doing so may lead to social loafing.   As they put it, in describing the impact of a contest for the "best" leader:

      'In effect, their thoughts about the leader may have been of the form "if you're so wonderful, you can get on with it.' 

    I am still not entirely sure that these arguments are right, but I guess they make some sense (although they do not quite explain why groups that did not select leaders at all did equally badly — the researchers suggest this is because the leadership role is necessary).  Yet the study, imperfections aside, is provocative.  I like it because it challenges so many deeply held assumptions about groups and organizational life.  I especially like how it implies that just THE PROCESS of selecting the leader can provoke group dynamics that undermine the performance of the group as a whole.  That is worth considerable attention as this is something that selection committees and such often forget — and consistent with findings from many corners of the behavioral sciences that show "what you do is as important as how you do it."  Also, while the survival games probably do not generalize well to most tasks in organizational life, another possible implication is that, if you are doing a task where no one has any special expertise or experience, you might try randomly selecting your leader.

    What do you think? Does this have any implication in real life, or is it just one of those crazy studies that is irrelevant to real people and organizations?

    P.S. As veteran readers of this blog may remember, I have written about the virtues of randomness before; check out this post about Karl Weick's cool ideas about randomness and wisdom.

    P.P.S. Do not miss the link to the study from Arie below.  More evidence that randomly promoting people might work! Thanks Arie, fantastically weird.