Geoff Colvin of Fortune has written a very interesting piece about my alma mater's 100th anniversary. Colvin sets out to ask some very succcesful alumni what they learned at HBS. After listening to their answers, he concluded, "All their answers are different, but they're all the same: none are about the content of the courses; all are about the experience." He goes on to say, "It makes sense that the content of the classes isn't what it's all about. That's constantly being commoditized."
At HBS, students learn to think, both individually and collectively, through the case method. It's active learning each and every day. At one point, Colvin quotes Yale Professor (and former HBS student and faculty member) Jeff Sonnenfeld, who says, ""I learned that yellowed lecture notes and blackboards filled with algorithms don't teach professionals how to think."
As a graduate and former faculty member of the school, I can attest to what Colvin and Sonnenfeld have concluded. We do easily forget the frameworks and theories that we learned at HBS, but we never forget the learning experience. As former Dean John McArthur once said, "How we teach is what we teach." In other words, the faculty member leads a process of collective inquiry, using the Socratic method, that can and should be emulated by leaders in any business. What do students learn at HBS? They learn the process of asking tough questions, stimulating debate, questioning assumptions, and generating alternatives. They learn to work as a group to identify and solve tough problems. These are the skills any aspiring business leader must master.
Thursday, March 27, 2008
Wednesday, March 19, 2008
The Collapse of Bear Stearns
The collapse of Bear Stearns brings to mind a fascinating quote by a very accomplished CEO: "I am well aware that humans will always make errors. My irritation comes from the fact that these errors are not caught immediately." That quote is from Alan “Ace” Greenberg, former Chairman and CEO of Bear Stearns, in a book titled Memos from the Chairman, which was published in 1996.
Tuesday, March 18, 2008
Steve Jobs on Apple's Strategy
This Steve Jobs' quote in the current issue of Fortune magazine (Most Admired Companies) exemplifies Michael Porter's idea that business strategy is as much about choosing what NOT to do as it is about determining what a company will do. Here is the quote:
"Apple is a $30 billion company, yet we've got less than 30 major products. I don't know if that's ever been done before. Certainly the great consumer electronics companies of the past had thousands of products. We tend to focus much more. People think focus means saying yes to the thing you've got to focus on. But that's not what it means at all. It means saying no to the hundred other good ideas that there are. You have to pick carefully (italics added). I'm actually as proud of many of the things we haven't done as the things we have done. The clearest example was when we were pressured for years to do a PDA, and I realized one day that 90% of the people who use a PDA only take information out of it on the road. They don't put information into it. Pretty soon cellphones are going to do that, so the PDA market's going to get reduced to a fraction of its current size, and it won't really be sustainable. So we decided not to get into it. If we had gotten into it, we wouldn't have had the resources to do the iPod. We probably wouldn't have seen it coming."
"Apple is a $30 billion company, yet we've got less than 30 major products. I don't know if that's ever been done before. Certainly the great consumer electronics companies of the past had thousands of products. We tend to focus much more. People think focus means saying yes to the thing you've got to focus on. But that's not what it means at all. It means saying no to the hundred other good ideas that there are. You have to pick carefully (italics added). I'm actually as proud of many of the things we haven't done as the things we have done. The clearest example was when we were pressured for years to do a PDA, and I realized one day that 90% of the people who use a PDA only take information out of it on the road. They don't put information into it. Pretty soon cellphones are going to do that, so the PDA market's going to get reduced to a fraction of its current size, and it won't really be sustainable. So we decided not to get into it. If we had gotten into it, we wouldn't have had the resources to do the iPod. We probably wouldn't have seen it coming."
Thursday, March 13, 2008
The Isolated Executive
Far too many senior executives at large companies become isolated in the corner office. Their professional lives involve a series of handlers - people who take their calls, screen their email, drive them places, run errands for them, etc. They live in gated communities, travel in first class, and stay at five-star hotels. They have worked hard for these privileges; few would suggest that they don't deserve them. However, executives often find themselves living and working in a bubble. They lose touch with their front-line employees, their customers, and their suppliers.
Yes, many senior executives conduct town-hall meetings with employees, and they go on customer visits periodically. They tour the company factories or stores, and they visit supplier locations. However, these events are often highly orchestrated and quite predictable. People typically know that they are coming... which clearly alters the dynamic a great deal. Often, executives simply witness a nice show, put on by lower level managers to impress them. They don't actually come to understand the needs and concerns of people who work in their factories or consume their goods. Such isolation breeds complacency and an inability to see new threats or opportunities.
How can executives protect against becoming isolated at the top? First, engage your consumers and employees in authentic, unscripted conversations. At Xerox, CEO Anne Mulcahy and fellow corporate officers rotate serving as "Customer Officer of the Day" at the company's headquarters (one day per month for each executive). In that role, they must deal personally with all customer complaints that come to the headquarters that day. As Mulcahy says, "it keeps us in touch with the real world. It grounds us."
Second, go watch how consumers behave, rather than simply relying on the data summarized after marketing research folks have conducted surveys or focus groups. People call this "ethnographic marketing" because the researcher acts as an anthropologist watching people in their natural environment. At Proctor and Gamble, CEO A.G. Lafley engages in such direct consumer observation. A 2003 Forbes article describes Lafley making visits to consumer homes "incognito" so that he can learn directly from watching how people live and use his firm's products.
Third, go put yourself in your front-line employee's shoes for a day. Go work on the line - whether that be at the cash register in a supermarket or at a station along an assembly line. When I began working at Staples in the mid-1990s, after completing my MBA, my first assignment was to spend several days stocking shelves and running a cash register in a store. You learn a great deal about the business in this manner. Executives too need to periodically go to the front lines.
Finally, executives must interact with young people. Time spent with young people exposes executives directly to new societal and technological trends, as well as a different perspective on the world. They should visit college campuses, spend time learning about social networking sites, as well as listen to and watch some of the multimedia (music, books, television) that young people enjoy. Within their own firms, executives might even take up Gary Hamel's suggestion that they set up a "shadow executive committee" consisting of employees 20 years younger than the actual top team (2003 Harvard Business Review article). Seeking feedback from these young workers can provide a fresh perspective on the firm's strategies and initiatives.
In sum, executives must work hard to break out of the bubble that often forms around them as they rise to the top of large organizations. It takes a concerted effort, but the payoff is great. They will keep themselves grounded, as Mulcahy notes, and they will create bountiful opportunities for learning. That learning can drive innovation and improvement in their organizations.
Yes, many senior executives conduct town-hall meetings with employees, and they go on customer visits periodically. They tour the company factories or stores, and they visit supplier locations. However, these events are often highly orchestrated and quite predictable. People typically know that they are coming... which clearly alters the dynamic a great deal. Often, executives simply witness a nice show, put on by lower level managers to impress them. They don't actually come to understand the needs and concerns of people who work in their factories or consume their goods. Such isolation breeds complacency and an inability to see new threats or opportunities.
How can executives protect against becoming isolated at the top? First, engage your consumers and employees in authentic, unscripted conversations. At Xerox, CEO Anne Mulcahy and fellow corporate officers rotate serving as "Customer Officer of the Day" at the company's headquarters (one day per month for each executive). In that role, they must deal personally with all customer complaints that come to the headquarters that day. As Mulcahy says, "it keeps us in touch with the real world. It grounds us."
Second, go watch how consumers behave, rather than simply relying on the data summarized after marketing research folks have conducted surveys or focus groups. People call this "ethnographic marketing" because the researcher acts as an anthropologist watching people in their natural environment. At Proctor and Gamble, CEO A.G. Lafley engages in such direct consumer observation. A 2003 Forbes article describes Lafley making visits to consumer homes "incognito" so that he can learn directly from watching how people live and use his firm's products.
Third, go put yourself in your front-line employee's shoes for a day. Go work on the line - whether that be at the cash register in a supermarket or at a station along an assembly line. When I began working at Staples in the mid-1990s, after completing my MBA, my first assignment was to spend several days stocking shelves and running a cash register in a store. You learn a great deal about the business in this manner. Executives too need to periodically go to the front lines.
Finally, executives must interact with young people. Time spent with young people exposes executives directly to new societal and technological trends, as well as a different perspective on the world. They should visit college campuses, spend time learning about social networking sites, as well as listen to and watch some of the multimedia (music, books, television) that young people enjoy. Within their own firms, executives might even take up Gary Hamel's suggestion that they set up a "shadow executive committee" consisting of employees 20 years younger than the actual top team (2003 Harvard Business Review article). Seeking feedback from these young workers can provide a fresh perspective on the firm's strategies and initiatives.
In sum, executives must work hard to break out of the bubble that often forms around them as they rise to the top of large organizations. It takes a concerted effort, but the payoff is great. They will keep themselves grounded, as Mulcahy notes, and they will create bountiful opportunities for learning. That learning can drive innovation and improvement in their organizations.
Tuesday, March 04, 2008
The Powerpoint Doldrums
We've all been in meetings where a presenter slogs through a seemingly endless Powerpoint presentation. The graphics are wonderful; the fonts are just right. Still, it's boring. People are multi-tasking right and left. The Blackberries are all in hand. The questions are few and far between. Thus, I found it interesting when I read the following quote in a recent Business Week article:
Stephen Pratt, chief executive of Infosys Consulting, understands the power of the pen; he rarely walks into a meeting with a formal presentation. "People tend to fall asleep when they see very long PowerPoint presentations full of text," Pratt says. "But if you start drawing on the board, people sit up in their chairs."
I found this particularly interesting, because as a professor, I know that many faculty members rely on Powerpoint heavily. It can easily become a snoozefest. I do use Powerpoint, but for most of my classes, I use the chalkboard or the whiteboard much more often. My drycleaning bill can attest to the fact that I love chalk! I find that students are much more engaged when you use the chalkboard to communicate an idea and to trigger a conversation with them. That's why I think Infosys CEO Stephen Pratt is correct. If the chalkboard or whiteboard works more effectively in the classroom, then I think there's no question that it can have a powerful impact during management meetings as well.
Stephen Pratt, chief executive of Infosys Consulting, understands the power of the pen; he rarely walks into a meeting with a formal presentation. "People tend to fall asleep when they see very long PowerPoint presentations full of text," Pratt says. "But if you start drawing on the board, people sit up in their chairs."
I found this particularly interesting, because as a professor, I know that many faculty members rely on Powerpoint heavily. It can easily become a snoozefest. I do use Powerpoint, but for most of my classes, I use the chalkboard or the whiteboard much more often. My drycleaning bill can attest to the fact that I love chalk! I find that students are much more engaged when you use the chalkboard to communicate an idea and to trigger a conversation with them. That's why I think Infosys CEO Stephen Pratt is correct. If the chalkboard or whiteboard works more effectively in the classroom, then I think there's no question that it can have a powerful impact during management meetings as well.
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