Merchandising, Choice, and Shopper Satisfaction

Wharton's Barbara Kahn explains her new research on how merchandising layouts affect buying behavior as well as shopper satisfaction.

The Benefits & Risks of International Experiences

A team of scholars has published an interesting new study in the Journal of Personality and Social Psychology regarding the impact that foreign experiences have on our behavior (Jackson Lu, Jordi Quoidbach, Francesca Gino, Alek Chakroff, William Maddux, and Adam Galinksy).  They built upon prior research that has demonstrated that foreign experiences bring certain important benefits to individuals.  Specifically, prior work has shown that foreign experiences foster cognitive flexibility and enhance creativity.   They also reduce intergroup bias.  

This new study shows that foreign experiences have negative impacts as well.  These scholars conducted eight studies using multiple research methodologies.  They found that foreign experiences enhance moral flexibility.   By that, they mean that foreign experiences increased moral relativism, and thereby enhanced immoral behavior on the part of individuals.  The findings held true even for people of different ages and cultures.  The study certainly does not mean that we should limit our international educational, travel, and work experiences.   However, it does sound a note of caution about the effects these experiences have on us.  The benefits can be substantial, but some important risks do arise.   

The Durability of First Impressions: Amazing Findings

Our parents often told us to work hard to make a positive first impression. They reminded us that first impressions matter a great deal, and that it's hard to recover from a bad start with someone. Well, it turns out that our parents were more right than we could have ever imagined. Let's take a look at some fascinating new research from Cornell Professor Vivian Zayas and her co-authors, Gul Gunaydin and Emre Selcuk.   Their study is titled, "Impressions Based on a Portrait Predict, 1-Month Later, Impressions Following a Live Interaction.” 

They asked 55 research subjects to examine photographs of a woman with whom they were not acquainted previously.    The scholars asked the individuals to record their impressions of the woman in the photograph.  The researchers asked if the subjects would like to be friends with the woman.  In addition, the research subjects rated the woman on personality attributes such as emotional stability, conscientiousness, extroversion, and openness to new experiences.   In some photos, the woman smiled. In others, she presented a neutral expression on her face.  Between one and six months later, these research subjects met the woman in person.   Only four people remembered seeing the woman in the photographs.  They were excluded from the study's subsequent analysis.   What about the other 51 research subjects?   Their initial impressions from those photographs shaped their impressions of the woman months later in the face-to-face interaction. Zayas told the Cornell Chronicle, "What is remarkable is that despite differences in impressions, participants were interacting with the same person, but came away with drastically different impressions of her even after a 20-minute face-to-face interaction."  

Rethinking How You Set Your Goals (and form New Year's Resolutions)

Duke's Dorie Clark has some good advice in her HBR blog post regarding goal setting strategies. Clark first cites some interesting research on the ineffectiveness of to-do lists:

Indeed, one indication of this is the pervasive use of to-do lists, which attempt to keep a handle on one’s responsibilities and are, according to one LinkedIn study, used by 63% of professionals. That would be great if we reliably accomplished what we set out to do. But the startup iDoneThis analyzed their users’ data and discovered that 41% of the to-do list tasks users inputted were never accomplished — little wonder in a world where the average professional has 150 tasks to be done at any given time, according to research by psychologist Ray Baumeister and John Tierney.

Clark then argues that individuals should make the same type of shift in planning and goal setting that corporations should make.    She makes the point that corporations need to move away from annual strategic planning rituals toward a shorter planning cycle that allows for nimble adaptation to changing competitive circumstances.  Similarly, Clark advocates moving away from the New Year's Resolutions technique toward a strategy of setting goals and revisiting them several times during the year.  Moreover, she argues for limiting the number of objectives that you establish at any given point in time.  Focus on the bigger goals rather than the lengthy to-do list.  Surely, you do have some routine tasks that you must accomplish.  However, Clark argues that we need to separate the mundane tasks from the bigger goals.  If not, we will always keep pushing aside the big meaningful task and focusing instead on trying to cross of  the minor items on the to-do list... so that we can at least feel some sense of progress on a daunting task list.  Clark summarizes her argument as follows:

The point of goals, of course, isn’t to successfully complete tasks we blindly set ourselves to years ago. Nor is it to maximize our accomplishment of small bore trivialities. Instead, what counts is our ability to master the right kind of big goals — the ones that can change your life, like positioning yourself for a promotion to the C-suite or writing a book or launching an entrepreneurial venture. You can only accomplish those kinds of goals when you’re willing to question assumptions regularly and re-evaluate as necessary, and when you give up the temporary dopamine hit of crossing easy tasks off your to-do list, in favor of making a dent in the handful of major projects that really matter.

Why Design Thinkers Need Grit

Lili Ermezei, Creative Strategy Director at Wonder Agency, makes the case in this terrific blog post that, "Being gritty is essential for successful design projects."   I agree wholeheartedly.  Some teams struggle during the design thinking process generate meaningful insights from their field research.   They settle for conclusions and interpretations that are superficial.  Others struggle because they converge too rapidly on a solution.  They fail to gather and accept sufficient user feedback, and they don't iterate effectively.   

Enlightened trial and error requires grit.  You have to be able to persist despite multiple failed prototypes and experiments.  You have to encounter numerous instances of negative feedback and persevere.  Many people become frustrated with the non-linear nature of the design thinking process. Grit certainly helps in this messy process.  

The Importance of Self-Reflection

Former Baxter International CEO Harry Kraemer recently described an important daily ritual to Kellogg Insights (Kraemer now teaches at Kellogg).  Kraemer has engaged in a nightly practice of self-reflection for nearly four decades.  He found this ritual highly useful throughout his career as a very successful business executive.  Kraemer argues that self-reflection has three important benefits:

1. It helps you set priorities and adjust them over time.   You can evaluate whether you are dedicating time, attention, and other resources in a way that is aligned with your priorities.  
2. It protects you against the possibility of a painful surprise.  Self-reflection enables you to anticipate what might go wrong and be better prepared for those contingencies.  
3. It helps you lead your team more effectively.  You can assess how the team is performing and what adjustments need to be made to enhance performance (including changes in the way you lead the team).  

The Link Between a Happy Spouse and a Healthy You

Scholars William Chopik and Ed O'Brien have conducted some fascinating research on the link between your spouse's happiness and your health.  According to the Booth Review, 

A number of previous studies have linked a person’s own happiness to health and longevity, but the researchers wondered if being around “happy others” might have a similar effect. To test the theory, Chopik and O’Brien assessed the health and happiness of nearly 2,000 couples, ages 50 to 94, over a period of six years. Both partners rated their individual happiness and life satisfaction, and answered questions about their personal physical health, including their activity level and any chronic health problems.  It turned out that the happiness of a person’s spouse was strongly linked to how healthy the individual was—in measures of overall health, physical impairment, and activity level. And this seemed to work for both partners. Even more, the effects of a partner’s happiness on a person’s health were independent of the individual’s own happiness level. “The current study demonstrates that happy partners seem to substitute as proxies for a happy self,” write Chopik and O’Brien.

The study left me wondering... What about happy co-workers, and even happy bosses?  Does your work context have a substantial impact on your health too?  It seems to me that it should.  Perhaps Chopik and O'Brien will examine that link next.  

Five Skills that Innovators Need

Lisa Kay Solomon and Emily Shepard shared some thoughts about innovation with a Stanford Business School class. They focused on five  skills that one must master to innovate successfully. Here's their list:

1. Observe:   Watch what others are doing, demonstrate empathy, and and record your observations of the world around you.   Keep a journal of your observations.
2. Question:  Be curious.  Ask good questions to get out the root of the problem you are trying to solve.
3. Associate:  Expose yourselves to environments where ideas from different domains come together.  Innovations often come from combining seemingly unrelated ideas.  
4. Experiment:  Sketching, drawing, and storyboarding can be simple ways to play with your ideas and to test out concepts.  
5. Network:  Don't just learn from other experts in your field.  Try to learn from people in other fields, far and wide. 

Leading Dispersed Teams

Eric McNulty, director of research at the National Preparedness Leadership Initiative, has written a blog post for Strategy + Business that addresses how to lead dispersed teams effectively. McNulty argues that teams should not be managed virtually the entire time that they are working together on a project. Instead, a geographically dispersed team should come together in person from time to time. He argues that in-person meetings offer several key benefits. Perhaps most importantly, McNulty argues that in-person meetings facilitate the formation of trust among team members. Higher levels of interpersonal trust increase a team's effectiveness for a number of reasons. Here's an excerpt: 

One of the primary reasons to get teams together has to do with the hardwiring of the human brain, says Valérie Berset-Price, founder and president of Professional Passport, a firm that coaches, trains, and troubleshoots with international and cross-cultural teams. The brain is always scanning for risk, according to Berset-Price, and among the things it uses to determine if someone is friend or foe are non-verbal cues. Those are absent in teleconferences and flattened in all but the best video conference systems.

“Building trust is a multisensory experience,” she says. “Only when people are physically present together can they use all of their senses” to establish that needed trust. Without a bond, conflict or disengagement can more easily arise and is more difficult to resolve. But when a group has the human connection that makes them a true team, “people can move sky and earth together,” Berset-Price adds... The multiplicity of cultural and linguistic challenges are more easily navigated when people work side-by-side to solve problems as well as share a meal, learn a bit about colleagues’ backgrounds, and swap stories about kids, sports, and other non-work issues. Team members are reminded of their colleagues’ humanity and learn to respect and better understand each other in ways that don’t materialize when they only engage remotely. A team becomes more productive and cohesive as a result.

Are You a "First-Principle" Thinker?

In last week’s New York Times Corner Office column, Adam Bryant interviewed Abe Ankumah, CEO and founder of the software company Nyansa. Ankumah discussed the importance of cultivating “first principle” thinkers in your organization. He wants people who don’t just to creating a solution without first understanding and defining the problem in a crystal-clear fashion. Here’s Ankumah explaining his “first principle” approach: 

I think start­ups kind of take on the value system of their founders. There are three of us who started the company, and we’re all first­-time entrepreneurs. We tend to be very “first principle” thinkers. What I mean by that is when you’re trying to solve a problem, you start by trying to understand the essence of the problem, rather than starting with what the answer should be and then working your way to justifying it. So it’s all about making sure that everyone understands the problem we’re trying to solve. And to do that, you have to maintain a broader perspective and listen very carefully to people.

The Cost of Not Speaking Up

David Maxfield has written a good article for Harvard Business Review titled, "How a Culture of Silence Eats Away at Your Company." He argues that people often say that they would speak up if they had a serious concern or dissenting opinion at work, but in an actual situation, they tend to be much more reluctant. Unsurprisingly, people say one thing and do another. My experience discussing this topic with many managers in a variety of industries confirms Maxfield's observation. Maxfield goes on to explain a simple experiment he conducted on this topic: 

At VitalSmarts, we’ve researched the propensity for people to stay silent before. In a previous study, we asked people what they would do if someone cut in front of them in line. Most people said they’d promptly and skillfully tell the person to head to the back of the line. But when we put their predictions to the test, we found something else. We went into a busy mall with confederates and a hidden camera to see what people really do when faced with a line-cutter. Here’s what we found: The line-cutting victims stand around looking frustrated yet never say a word. A few make dirty faces behind our confederates’ backs or complain to their neighbor. In our study, only one in 25 spoke up.

What's the downside of not speaking up? Naturally, the most crucial danger is that key risks will remain hidden in organizations. Bad news will not rise to the top. In the most extreme circumstances, a catastrophic failure could occur. Consider the costs of people not speaking up at GM with regard to the ignition switch scandal, or the similar dynamic that occurred at Volkswagen with regard to the emissions testing scandal. 

Maxfield argues, though, that there are other very real costs of a culture of silence. He makes the point that people don't simply remain silent. They waste a great deal of time and energy in their frustration over the issue. Here's an excerpt from his article:

Instead of speaking up in these situations, our subjects admitted to engaging in one or more resource-sapping behaviors including: complaining to others (78%), doing extra or unnecessary work (66%), ruminating about the problem (53%), or getting angry (50%). These behaviors aren’t just unhelpful; they’re costly. We found the average person wasted 7 days complaining, doing unnecessary work, ruminating about the problem, or getting angry — instead of speaking up. A shocking 40% of our respondents admitted to wasting two weeks or more.

An Effective Fix for Bored, Disengaged Employees

Chief Learning Officer magazine reported this week on a study by Udemy about boredom and disengagement in the workplace.  The study found that 43% of respondents were bored at work.  80% believed learning new skills would enhance their boredom.  Bored workers were twice as likely to leave the firm.  Females and millennials were more likely than men and baby boomers to report that they were bored at work.  

Why these feelings on the part of so many workers?   People get bored at work for several reasons. First, they are stuck performing the same routine day after day.   People value some variety in their work.   Second, they have no autonomy.   They simply must follow the directives of others, with no ability to suggest and implement better ways to accomplish the organizations's goals and objectives.  Third, they don't understand the big picture.  These workers do not comprehend how their work is contributing to important organizational goals.  The sense of mission is simply not there.   Finally, they are not being challenged.  They are not being asked to learn new skills, take on difficult challenges, and develop personally.  

What's the fix?  Give workers a clear sense of mission.  Show them the importance of their work, how it fits into the bigger picture.  Provide them the autonomy to recommend and execute better ways of getting the work done.  Instill some variety into each person's workweek, so that they are not stuck in a dull routine.  Finally, provide them opportunities for learning and development, through both new challenges on the job or off-line training and education.  

Innovative Environments: The Bell Labs Story

Zara: Can Competitors Match Its Fast Fashion Model?

Patricia Kowsmann wrote a terrific article about Zara today.  Zara, as many of you know, is a highly successful Spanish apparel retailer.  In the article Kowsmann explains how quickly Zara can bring a new design to the retail floor, ready for customer purchase.  Here's an excerpt:  

A black, high-collar women’s wrap coat, fastened with a metal ring, was hung out for sale one recent morning at Zara’s flagship store in New York.  “Customers asked for hardware this season,” the manager said, holding out the ring. That kind of feedback, he added, can inspire a new style that reaches his store within weeks.  This coat took 25 days.

Recall that I blogged about The Gap's troubles several days ago.   The Gap finds itself in trouble for several reasons.  One cause of the company's problems is its inability to cope with fast fashion competitors such as Zara.  Kowsmann's article points out that many competitors, including the Gap, have emulated Zara's strategy of bringing manufacturing closer to its retail stores.  This supply chain strategy enables Zara to move more quickly and to adapt more easily to changing customer preferences.  However, Kowsmann explains that simply matching the location strategy that Zara has employed for its manufacturing facilities won't provide the winning formula for many of these retailers. Why?  Here's Kowsmann:

But experts say it would be hard for competitors to replicate the Inditex model without a more thorough overhaul of the way they design, manufacture and distribute their products.  The Spanish retailer’s rivals might move production closer to home, but they “just don’t have an organization set up to react quickly to what is trending,” said Liz Dunn, founder of Talmage Advisors, a retail consulting firm.

In short, Zara's competitive advantage does not come simply from its sourcing strategy.  It entails an entire integrated system of activities.  The New Yorker's James Surowiecki once wrote about the company, and he explained this very point.  Zara has a whole package that is very hard to imitate.  Placing factories closer to stores may have some benefits, but that doesn't mean these rivals can match Zara's fast fashion success.

Treatment of Failures at Foundry X