Friday, March 16, 2018

The Power of Guilt: Understanding Employee Absenteeism

Most of us probably believe that a link exists between a person's attendance record at work and his or her job satisfaction.  The employees who show up every day must be more satisfied than those who opt to stay home a fair bit, right?  Not so fast. Interestingly, the data do not support the beliefs most of us hold about absenteeism and job satisfaction.  

An interesting new study helps us understand what's really going on in the workplace.  Rebecca Schaumberg and Francis J. Flynn examined more than 300 customer service associates at various call centers.   The scholars measured job satisfaction, and they tracked the employee's attendance at work over a four month period.   Interestingly, they also administered a survey to evaluate how "guilt prone" each individual was.  What did they discover?  If individuals were not very susceptible to feelings of guilt, then attendance and job satisfaction are positvely corelated.  In other words, the more dissatisfied people are, the more likely they are to miss work.  That's what we would expect.  However, things change when we examine people who are higly "guilt prone."  For these people, no relationship exists between attendance and job satisfaction.  These people sometimes keep right on showing up for work, even if they are very unhappy, because of their feelings of guilt.  

The lesson is clear - be careful how you interpret a strong attendance record on the part of employees.  Low absenteeism may not signal that you have created a terrific work environment where people love to come to work.  It may tell more about the personal attributes of your workers, and what motivates them to act each morning.  

Tuesday, March 13, 2018

A Constructive Activity on a Snow Day

Another nor'easter rages today in the northeast.   Weather forecasters predict 15-20 inches of snow in my region.  Many people are not working today.  What can and should you with your time if you have some free time?  Besides shoveling the driveway, catching up on email, or taking a nap, you might consider learning something new.  Researchers have demonstrated that novelty stimulates the brain.   Moreover, innovative solutions often arise when people make connections between seemingly disparate concepts.  Therefore, think about reading a book about something outside of your domain of expertise.  Perhaps find a good documentary that intrigues you.  Play a game that you have never played before with your kids.  You may just ignite a creative spark by exposing yourself to a novel experience.  

Monday, March 12, 2018

Choiceology Podcast with Dan Heath

Check out my appearance on the "Summit Fever" episode of Dan Heath's Choiceology podcast.  You may know Dan as the best-selling co-author of books such as Made to Stick, Switch, Decisive, and The Power of Moments.  His books, written with his brother, Chip Heath of Stanford, are just terrific.  

Thursday, March 08, 2018

I Already Know That...

What's one of the most dangerous phrases that you can hear a leader utter?  "I already know that..." Why is it so worrisome when we hear those words?  It suggests that the individual believes that their state of knowledge on that subject is settled and complete.   Therefore, they might not be open to learning new things, to questioning what their assumptions, and to considering the fact that they just might be wrong.   We want leaders to at least consider the possibility that they are mistaken, or that changing circumstances make old assumptions outdated.  The next time you find yourself thinking, "I already know that," I encourage you to ask instead, "What questions might I ask that could spur additional learning on this subject?  How might I benefit from reconsidering my views and assumptions here? What could I be missing?"     

Tuesday, March 06, 2018

United Airlines Reverses Bonus Policy Decision

Well, that didn't take long.  After a firestorm of criticism, United Airlines has walked back their compensation policy change.   They will not be moving to the lottery system that they had proposed to replace regular quarterly performance bonuses for employees.   United President Scott Kirby issued a new memo to all employees.   Here is an excerpt:

"Since announcing our planned changes to the quarterly operations incentive program, we have listened carefully to the feedback and concerns you've expressed," Kirby wrote. " Our intention was to introduce a better, more exciting program, but we misjudged how these changes would be received by many of you. So, we are pressing the pause button on these changes to review your feedback and consider the right way to move ahead. We will be reaching out to work groups across the company, and the changes we make will better reflect your feedback."

I'm certainly glad that Kirby has reconsidered his decision.   Hopefully, Kirby and his team have learned that they would not have "misjudged" the employee reaction if they had simply sought feedback BEFORE issuing this policy announcement.  If senior executives wanted to change the compensation program, why not consult with people on the front lines more extensively PRIOR to making the shift?   The lack of an effort to solicit broad input is rather stunning.   The biggest management failure here is not "misjudging" employee reactions.  The colossal mistake is the highly flawed decision-making process.  The Board of Directors ought to be asking penetrating questions about that process more generally, rather than only focusing on this particular policy.   

Monday, March 05, 2018

United Airlines Eliminates Bonuses, Angers Employees

News reports this morning indicate that United Airlines has announced a significant change to its employee compensation policies.  The company has eliminated quarterly employee bonuses amounting to roughly $1,200 per year.   Instead, employees will be entered into a lottery in which a few lucky winners will receive cash payouts.  Others will not receive anything.  Only those with perfect attendance will be eligible for the lottery-type payouts.  United  Airlines President Scott Kirby issued a memo to employees explaining the change. Inc. magazine reports on several quotes from the memo:

“As we look to continue improving, we took a step back and decided to replace the quarterly operational bonus and perfect attendance programs with an exciting new rewards program called ‘core4 Score Rewards.'" 

"The reason for this change goes to the heart of our strategy: offering meaningful rewards will build excitement and a sense of accomplishment with more bang for the buck." 

"We want every United team member to picture themselves walking home with a grand prize, or driving home in a beautiful car that announces for all to see that you are committed to your success and ours."

Multiple reports indicate that employees are not pleased, to say the least. "The Points Guy" online travel site obtained a number of employee comments posted over the weekend on tthe airline’s “Flying Together” internal forum (in total, the Points Guy reports that more than 1,700 comments were posted on this forum). Here's one comment:

I find it unbelievable that management is so out of touch with their work force. To tout this announcement as something that workers would be excited about and appreciate just shows how elitist they are. This program is totally contradictory to the CORE4 “we are listening, we are one” philosophy!

Bill Murphy at also reported on some of these employee comments.   According to his article, employees offered comments such as:

"It occurred to me and my wife that this is terribly unfair to single parents. ... Imagine your child coming home sick from school, no fault of your own. You are faced with calling in sick thus losing your 'chance' at a bonus or leaving your child/children home alone to care for themselves. What a terrible situation United has put that person in." --First Officer - B-767/B-757

"I can't imagine driving the Mercedes into the employee lot while everyone around me that worked just as hard, or harder got nothing. I would feel like such a jerk. It's quite telling about the people who thought this up. I bet they would be gloating happily if they won." --Flight Attendant - Domestic

I'm fascinated to see how United responds to this furor that has emerged in news reports, social media, their internal forum, and in the form of a petition.  It certainly sounds as though they did not seek widespread input from front-line employees before making this change, and they did not test the messaging sufficiently before sending out this memo.   What a mess they have created!  As the old adage goes, it takes years to build trust within your organization, and it only takes one big mistake to destroy that trust.  

Friday, March 02, 2018

The Downside of Preaching What You Practice

You are an expert and high performer in your organization, and senior leaders have asked you to share your best practices, your secrets to success. How should you approach the fulfillment of this request. With caution! Why? It turns out that preaching what you practice can backfire. At Stanford, researchers BenoĆ®t Monin and Lauren Howe have studied physician and patient behavior.   What happens, for instance, when a doctor shares information regarding his or her own healthy lifestyle with a patient who may be living in an unhealthy manner?   Here's what they found:

Doctors who emphasize their fitness seem like they may be more critical of patients who don’t live up to the same high standards. And it’s not that doctors actually devalue patients; it’s something overweight patients fear might happen to them when seeking out a new doctor, especially a doctor who touts his or her own exemplary health habits in their literature or online. This is called anticipated devaluation, and it can make overweight patients shy away from doctors who emphasize that they practice what they preach. Moreover, the researchers note, when patients feel devalued, they may seek care elsewhere or delay seeking it altogether to the detriment of their long-term health.

We should not be surprised by these results.   For me, the takeaway is that we must demonstrate empathy when we preach what we practice.  We have to step into the other person's shoes.  Moreover, we have to acknowledge our own fallibility.  Talking about our mistakes, and the hurdles we have had to surmount, can help others listen to our ideas and recommendations.  

Tuesday, February 27, 2018

The Power of a Free Popsicle

Source: TripAdvisor
Chip and Dan Heath, best-selling authors of books such as Made to Stick and Switch, have published another terrific book.   In The Power of Moments, the Heath brothers examine how we can create defining and memorable experiences for our customers, employees, and others.   Chip Heath explains that perfection at every step is very difficult to achieve, but we can identify very important moments where our organizations can shine: 

“Jan Carlzon [former CEO of Scandinavian Airlines] coined the phrase ‘moments of truth’ and talked about getting right the thousands of touchpoints with customers that happen daily. I don’t think you have to fix thousands of touchpoints. Maybe you want to have one defining moment at the gate and one moment at the luggage reclaim area. Maybe you want to invest in an entertaining flight safety video that people actually enjoy watching, like Virgin America.”

The book features a terrific example.  They cite The Magic Castle Hotel, the fourth highest rated hotel on TripAdvisor in Los Angeles, California.  The top three hotels are high-priced, luxury hotels.   Magic Castle costs only $199 per night. The accommodations are not luxurious. The Heath brothers describe it as, "a converted two-story apartment complex from the 1950s, painted canary yellow … [with] a pool that might qualify as Olympic size, if the Olympics were being held in your backyard."  

What makes customers so delighted to stay at Magic Castle?   The hotel has created several powerful defining moments for its customers.  These memorable moments demonstrate the hotel's commitment to its guests, and provide a little unexpected delight for those who stay there.  As an example, the Heaths describe the "Popsicle Hotline" at the hotel.   If you are relaxing by the pool, you can dial his hotline and request a free popsicle in your favorite flavor.   Soon, a hotel employee arrives in white gloves to deliver that popsicle to you on a silver platter.    Can you imagine that?  It sounds silly, but it certainly provides a small moment of joy for the guests.  Many of them go on to tell others about this amazing little experience by the pool.   In a world full of brusque customer service and disappointing experiences at restaurants and hotels, this defining moment sticks out.  

What the defining moments that you can create for your customers and employees?   

Monday, February 26, 2018

Scale and Profitability: The Link is Not As Strong as Many Executives Believe

James Allen, co-leader of Bain Consulting's strategy practice, has written a short article for the Wall Street Journal about the scale advantages (or lack thereof) of industry leaders. Allen reviews the findings from research the firm conducted across 45 industries.   Certainly, scale had its advantages in many of these industries.   However, it's far from a guarantee of success.  Allen summarizes the conclusions:

Strikingly, we found that on average, 80% of the economic profit pool was concentrated in the hands of just one or two players in each market. These strong performers generated nearly two times their cost of capital in profits. And among these economic leaders, 40% were not scale leaders at all. These best-performing companies, it turns out, achieve economic leadership in other ways.

As I've written before on this blog, executives consistently overestimate the benefits of scale.  This study should cause them to reconsider their beliefs.   Moreover, the biggest firms should ask themselves:  In what ways are our scale and scope key disadvantages relative to innovative newcomers?  

Friday, February 23, 2018

Cross-Cultural Disaster: Canadian Prime Minister Trudeau in India
Business Insider reports this week on the trip that Canadian Prime Minister Justin Trudeau took to India.    The entire trip represents a classic example of what NOT to do when traveling to a different country.   Trudeau appeared unprepared to deal with some very sensitive issues and committed some political blunders.   Even more astonishingly, he seemed to try far too hard to embrace the local culture, and in so doing, he looked very, very foolish.  Business Insider writes:

Canadian Prime Minister Justin Trudeau, normally a darling of Western media, has been roundly, and sometimes savagely, mocked for a trip to India that included cultural, fashion, and political blunders at every turn...On several occasions Trudeau and his family appeared dressed in traditional Indian clothing, something other Western politicians don't usually attempt with such vigor.  Prominent Indian personalities expressed their distaste for Trudeau's dress, with India Today calling it "tacky." Trudeau showed up at an event full of Bollywood stars in full traditional dress, while the movie stars themselves simply wore black suits.  On social media, popular Indian personalities put it more bluntly, calling for Trudeau to "have some chill" and calling his outfit choices "fake and annoying."

There's a very important lesson here.  Do your homework before you visit another country.   Learn about important customs, rituals, and traditions.  Respect key religious and cultural differences.  Take the time to learn at least a few words of the local language.   However, don't try to pretend that you are a native citizen.  Be who you are.  Be a respectful and authentic visitor who wants to learn, not somebody looking to rack up "brownie points" with the local people.   

Thursday, February 22, 2018

Success Theater at GE: Ambitious Targets and Hiding Bad News

Thomas Gryta, Joann Lublin, and David Benoit have written a lengthy feature article in the Wall Street Journal today about GE's struggles. The authors describe a "confidence culture" where senior executives set very ambitious targets and exuded relentless optimism about achieving those goals. Moreover, people found it difficult to push back and suggest that these objectives might not be achievable. Jeffrey Immelt seemed to downplay clear signals that the goals could not be achieved, perhaps selectively looking for information that would confirm his preexisting beliefs about what they could achieve as an organization. Gryta, Lublin, and Benoit write:

GE’s precipitous fall, following years of treading water while the overall economy grew, was exacerbated, some insiders say, by what they call “success theater.” Mr. Immelt and his top deputies projected an optimism about GE’s business and its future that didn’t always match the reality of its operations or its markets, according to more than a dozen current and former executives, investors and people close to the company.... Mr. Immelt didn’t like hearing bad news, said several executives who worked with him, and didn’t like delivering bad news, either. He wanted people to make their sales and financial targets and thought he could make the numbers, too, they said.

The article raises an important question for all leaders: How do you know if you have set overly ambitious goals for the organization and put harmful pressure on your people? How might we rethink what it means to stretch the organization? Here are my thoughts. It can be very productive to set a long term goal (3 years or more) of creating a breakthrough new product or entering a whole new market. Framing that goal in a way that provides meaning to people's work is important when setting that long term goal. Ask yourself: What is our purpose here? How are we trying to make our customers' lives better? Stretching your people in this way can be very inspiring. Setting over-the-top ambitious short term financial targets, on the other hand, can be dangerous. It can even lead to unethical or illegal behavior, as people feel pressured to deliver and to hide bad news. It also doesn't inspire people if you simply aim to achieve higher ROI or market share. Think about goals about which your people will feel passionate and inspired. 

Moreover, co-creating highly ambitious goals can be much more productive than establishing them in a top-down manner. What do your people want to achieve? What bold moves would they like to pursue? What do they care passionately about, and what do customers care deeply about as well? Finally, You have to create a healthy feedback loop. How are things really going? Where are we finding it difficult to meet our objectives? Being honest doesn't mean walking away from stretch goals. It does mean understanding how things are transpiring differently than you had hoped, and adjusting your plans accordingly. Work together with your people to figure out how to surmount obstacles, rather than simply telling them to charge up that hill again. 

Tuesday, February 20, 2018

Stop the Reorganizations!

Many chief executives initiate a substantial reorganization during the early stages of their tenure.  for some companies, reorganiations become a seemingly annual event.   No one has any idea what the updated organization chart looks like, because it is changing so often.    Does all this reorganization add value? Probably not. One recent McKinsey and Company study concluded that only 16% of restructurings could be characterized as an “unqualified success.” Similarly, Bain and Company found that most reorganizations do not generate improved results.  Why do leaders enjoy redrawing the boxes and lines on the organiation chart so often?  Frankly, it's easy to do.  Taking other types of actions to enhance performance can be much more challenging and time consuming.   Too often, leaders choose the easy path, despite the proven lack of efficacy.   Somehow they think that their firm will be different.  

Confusion and ambiguity hamper productivity in these organizations that are constantly changing reporting relationships.   Moroever, people become frustrated by the disruptions to work processes and routines.  Wharton’s Peter Cappelli compares serial reorganizing to prescribing antibiotics very frequently for minor infections. You might alleviate the pain at that moment, but harm the patient over time. Cappelli notes, “The constant churning caused by these reorganizations generates costs and develops long-term cynicism about why they are done and what they mean.”

Monday, February 19, 2018

Secrets to Success for Norway's Ski Team

Bill Pennington has written an interesting article about the Norwegian ski team in today's New York Times.  I first heard about this ski team's interesting dynamics during a feature on NBC's Olympic broadcast a few days ago.  The Norwegian ski team has amassed many medals and championships over the years, including a strong performance at this winter's Olympics in South Korea.   Naturally, many factors might account for their success.  Interestingly, though, the Norwegian skiers contend that team dynamics plays an important role, despite the fact that the sport is highly individualistic.   Team members explain that they abide by five basic ground rules:

1.  No jerks allowed - You have to subvert your ego and abide by the golden rule - treat others the way that you would like to be treated.  

2.  No class structure - Aleksander Kilde explains that there is no pecking order on the team.  They treat each other as equals, whether someone is a champion or a rookie.  

3.  The social quality of the team is of primary importance - you must act in ways that preserve the collaborative environment within the team.  People share knowledge and best practices with one another, rather than hording information and keeping secrets.   They try to help each other achieve their personal best. 

4.  Talk to each other, not about each other - Don't go behind other's backs with complaints. Have honest conversations directly with one another.  

5.  Friday night is taco night - They step away from their busy schedules to share a meal together every Friday night.  

Clearly, the five rules do not explain all of the Norwegian team's success.  However, they do offer a good template for how to begin building a better team, even if you are far from an alpine ski course.  

Thursday, February 15, 2018

Strong Airline Profitability? Is it Really About Fees?

Source: Dallas News
For decades, the airline industry has been characterized by abysmal profits. The list of airline bankruptcies is seemingly endless. However, the Wall Street Journal reports this week that U.S. airline industry profitability is very strong at the moment - "healthier than ever" according to the headline.  The newspaper credits the litany of fees charged by airlines for the strong income numbers:  

Profit per passenger at the seven largest U.S. airlines averaged $19.65 over the past four years—record-setting profitable years for airlines. In 2017, it stood at $17.75, based on airline earnings reports. In truth, airlines now cover their costs with tickets and get their profits from baggage fees, seat fees, reservation-change fees and just about all the other nickel-and-diming that aggravates customers. You might also call those extra 12 to 15 passengers now crammed onto each flight “Andrew Jackson” for the profit they bring... U.S. airlines were on pace to take in more than $4 billion in baggage fees and $3 billion in reservation-change and cancellation penalties in 2017, according to Transportation Department data. (The full year hasn’t been tallied yet.) Most of that drops straight to the bottom line. The two categories add up to about more than half of the net profits airlines posted last year.

A couple of sentences toward the end of the article identify the airline with the highest profit margins in the industry.   Accoridng to the Wall Street Journal, Southwest tops the industry with a 16.5% net profit margin, nearly double the average margin in  the industry (9%).   Actually, the newspaper does not account for a one-time tax benefit of roughly 6%.  After adjusting for that figure, Southwest's advantage over the rest of the industry is much narrower.   Still, Southwest generated strong profits, as it has in the past.  The article does not delve into the reasons for that profitability.  Southwest Airlines does not charge baggage fees, unlike nearly all of its rivals.   Southwest also does not administer ticket change fees, unlike nearly all of its rivals.   How then does it generate strong  margins in the industry?  That's the question that the newspaper should explore.   

In weaker economic times, the other airlines may find it much more difficult to continue to generate strong consumer demand while charging so many fees.  A more sustainable competitive advantage comes from a distinctive strategy and organization, as Southwest has developed over many years.   Many scholars have studied this question over the years.  Perhaps it's old news to the Wall Street Journal, but that old news offers much more enduring lessons for managers than the story of how piling on fees has juiced profits recently for some players. 

Wednesday, February 14, 2018

Nordstrom Unlocks Its Changing Rooms

Source: NY Times
Luxury retailer Nordstrom continues to innovate in hopes of surviving and thriving in the embattled department store business. The Wall Street Journal reports today on many of the experiments that the firm is conducting. For example, Nordstrom chose to stop locking its fitting rooms recently. The WSJ reports on the change:

In November, the company unlocked the fitting rooms in its department stores. Many retailers keep them locked to discourage shoplifting, but the practice annoys customers. Although theft has increased slightly since Nordstrom made the change, executives say, the retailer is sticking with the new policy.  “Analysts don’t like it,” Jamie Nordstrom said. “But I’m thinking about the next 50 years, not the next quarter.”

I've always found these types of moves interesting.  Typically, managers conduct cost-benefit analysis when they make key decisions.  However, in certain cases, the costs can be quantified rather easily, but the benefits are not as well-defined.  Many managers would not go through with this decision because the cost-benefit analysis does not justify it.  Here, the costs of increased theft can be measured precisely.   The benefits from increased customer satisfaction may be much more difficult to evaluate and quantify.  Still, Nordstrom knows that its loyal customers do not appreciate the locks on the changing room doors.  Will this small change enhance customer loyalty?  Will people be more likely to try on multiple outfits now?  Might it increase the size of the average transaction per store visit?  Some of these things can be measured with time and some creativity.  In certain cases, though, managers simply have to side with the customer, recognizing that it may not pay immediate dividends.  In the long run, Nordstrom won't win against online competition through better assortment or lower prices.  They have to create a superior in-store experience.  This small step appears to be moving in the right direction on that front.  

Tuesday, February 13, 2018

Advisers and Uncertain Advice

Celia Gaertig and Joseph Simmons have published a paper titled, "Do People Inherently Dislike Uncertain Advice?"   The authors focus on the longstanding research finding that individuals prefer confident to uncertain advisors.   Individuals generally don't want take advice from someone who does not appear self-assured.  Gaertig and Simmons extend this research by examining the question:  Do people exhibit an aversion to uncertain advice itself?

The scholars studied advice evaluation in a series of studies focused on issues such as sports predictions, finance, and weather.  Their findings proved remarkably consistent.   Indeed, people evaluate confident advisers more favorably than those who appear uncertain and hesitant.  However, people do not necessarily dislike uncertain advice.   Here is an excerpt from their paper: 

In eleven studies, we found that people do not inherently dislike uncertain advice. We observed this in studies of sports, weather, and stocks. We observed this in studies that operationalized uncertain advice as imprecision, as statements of numerical probability, and as statements of non-numerical uncertainty. And we observed this in studies in which people directly evaluated the advice and in studies that asked people to choose between an advisor who provided certain advice versus one who provided uncertain advice.  

This paper gives me comfort.  It shows that people are quite capable of sifting through advice, and recognizing the merits of advice couched in the form of probabilities.  We do not expect complete certainty.  That's a good thing, as I believe we should be skeptical of advice and predictions that seem to express absolute certainty.    We just might be more rational than some people think!  

Monday, February 12, 2018

Communicate Goals, Then Test for Understanding & Learn from Your Audience

Leaders often assume that people at all levels understand the organization's goals and objectives.   Is that presumption correct?  In too many cases, it is not.  What happens?   First, leaders do not recognize that they must communicate those goals repeatedly - in different ways, through different channels, and using different media.   It is not sufficient to address goals once or twice at the outset of the year. You have to beat that drum reepeatedly.  However, you also must make a compelling case for why front-line employees should care about those goals and objectives.  Ask yourself: So what?  How can you answer that question for the workers at all levels.  Why should they care?   

Even more importantly, though, leaders have to test for understanding.  A leader has to put his or her finger on the pulse of the organization, so as to determine whether people heard and comprehended the message.   How do you put your finger on the pulse of your firm?  Certainly, managing by walking around helps.  Meeting people informally, perhaps in small group lunches in the cafeteria, can be useful as well.   Finding ways to solicit and address employee questions is crucial.   Asking them to play back what they have heard from their managers is a useful technique.  Listen carefullyas they speak to you.  Don't put words in their mouths.   Ask them to be as specific as possible about the sources of their confusion.  

If they didn't understand the goals or misintrepreted them, don't blame the audience!  It's not their fault for misunderstanding your message.  You have to learn from them, and you must clarify and modify the communication accordingly.   Ask for their help!  Often, the audience can help you craft a more compelling and easy-to-understand message.  

TEDx Bryant 2018

I enjoyed speaking at the inaugural TEDx Bryant event on Saturday, February 10th.  I look forward to sharing the video via YouTube as soon as it is posted.  My talk addressed the topic, "Does the Devil's Advocate Kill Creativity?"  

Saturday, February 10, 2018

L.L. Bean Alters Its Unlimited Returns Policy

L.L. Bean announced a major change in its famous product return policy yesterday.   The Maine-based retailer always used to allow customers to return goods years after purchase with no questions asked.  Their lifetime guaruantee stood out as one of the distinctive elements of the firm's value proposition and brand positioning. Now, though, the company has put a one-year limit on product returns. Here is what the company told the Wall Street Journal: “For over 100 years, our guarantee has worked just fine, but in the past five years in particular, our guarantee has been misinterpreted as a lifetime product replacement program and we have seen a large influx of returns that have nothing to do with product quality or satisfaction." reported on the rampant customer abuse of the L.L. Bean's longstanding policy, leading to this change in company policy:

Over the past five years, the company has lost $250 million on returned items that are classified by the company as ‘‘destroy quality,’’ said L.L. Bean spokeswoman Carolyn Beem. ‘‘Destroy quality’’ items are destined for the landfill. First-quality products are returned to store shelves and ‘‘seconds’’ are sold at outlets or donated to charity. It’s not uncommon to hear stories of people clearing out basements of used or unwanted L.L. Bean products, sometimes decades after their purchase. Some customers replace the same items year after year to get the latest outdoor gear. Some even head to thrift stores, yard sales or junkyards to retrieve L.L. Bean items that they then return.

Sadly, a small minority of customers have spoiled it for the rest of the company's loyal fans.  For L.L. Bean, the policy change is not without risk.   However, the fact that competitors, including REI, had already made similar changes in recent years lessens the risk.   Moreover, the company does leave itself the ability to address customer concerns on a case-by-case basis.   The new policy on the L.L. Bean website states "If you are not 100% satisfied with one of our products, you may return it within one year of purchase for a refund. After one year, we will consider any items for return that are defective due to materials or craftsmanship."   In other words, if you are a loyal customer and have a return after one year, the company retains the ability to address your concerns.  They simply do not want to have to provide a blanket, open-ended return policy for all.   

In general, I think L.L. Bean appears to be handling this issue well.  They clearly did their homework vis a vis loyal customers and their competitors before making this change.  However, I do wonder why they didn't choose to simultaneously announce some other measures to demonstrate their commitment to their most dedicated fans.   An olive branch to the hard-core fans, offered in conjunction with this policy change announcement, might have provided a more upbeat message and offset some of the negative reaction they surely will receive.   

Friday, February 09, 2018

Overconfidence in Founder-Led Firms

Bradley Hendricks and Mark Lang, and Kenneth J. Merkley evaluated 11,285 10-Ks reports filed by firms that went public between January 1, 1997 and December 31, 2013.  They have published a paper about a key distinction between the filings of founder-led firms and companies led by non-founders. The paper is titled, “Through the Eyes of the Founder: CEO Characteristics and Firms’ Regulatory Filings.”

Hendricks, Lang, and Merkley find a significant degree of overconfidence on the part of the founder-led firms.  They report, "Consistent with firms’ financial reports reflecting the founder’s optimism, we find that the 10-Ks for founder-led firms tend to be characterized by both more positive text and less negative text relative to 10-Ks for other firms."  

Prior research suggests that a positive tone in the 10K filing leads to a higher stock price.  However, the authors questioned how investors would react to the optimism conveyed by founder-led companies.  Perhaps investors would be attuned to the fact that entrepreneurs can exude overconfidence, and thus they would discount the optimistic statements made by founder-led firms.  What did they actually find?   Share prices rise in a similar fashion in the immediate aftermath of the 10K filing for both founder-led firms and those led by non-founders.  The authors state, "We find that investors do not appear to recognize founders’ tendency toward overoptimism and, instead, interpret tone for founder-led firms similarly to non-founder-led firms."  

What happens later on though?  For the full year after the 10K filing, the scholars found a negative relationship between the tone of the 10K and stock price performance for the founder-led firms.  No such negative relationship exists for the firms led by non-founders.   That finding supports the notion that investors mistakenly accept the overly optimistic pronouncements of founders initially, and the correction only takes place over time as they realize that the actual performance will not meet lofty expectations.   

What's the lesson here?  We need to analyze company pronouncements not simply in terms of the content, but in terms of the messenger as well.  Who is the company leader, and what is his or her background?  If he or she is an entrepreneur/founder, we might want to be a bit more careful about accepting their positive statements and projections.  

Thursday, February 08, 2018

How Status Disruptions Affect Teams

Marissa King and Ingrid Nembhard have conducted research on teams using a new set of methods and techniques. They used wearable sensors to collect real-time data about team member interactions and conversations.   King and Nembhard studied 66 teams in 13 healthcare centers.  They focused on the impact of assigning a nurse as a care coordinator for patients.  They expected this role to improve patient care outcomes, given that prior studies have shown that coordination failures in healthcare lead to poorer quality care and higher medical costs.   Surprisingly, the results did not work out as expected.   King explains: 

Everything was contrary to what we anticipated. We set up the experiment really to try to improve care through this care coordination intervention. We quickly realized that the intervention wasn’t nearly as successful as we anticipated going in. In fact, the elevation of the nurse’s position within a network actually induced status conflict. Increasing the nurse’s status within her team increased interruptions within the team; it decreased the amount of time that doctors and physicians and nurses were spending listening to each other. The interaction dynamics that ensued from elevating the nurse, rather than being better, actually got much worse...Everybody, I think, finds comfort in knowing where they sit. So when you change that, everybody is disrupted.

The study has some interesting implicaitons for teams in many industries.   People become accustomed to a certain pecking order and specific status dynamics within a team or organization.  Changing that dynamic certainly can be unsettling, in my experience.  I've seen it with faculty members elevated to leadership and administration roles, for instance.   I certainly have witnessed this type of unsettling disruption in the businesses with whom I have worked over the years.  However, I think some people are much more equipped than others to handle this dynamic.  When elevated to a coordination or management role, they recognize that the transition can be tricky for other team members.  They handle the situation with care, and they help people overcome the discomfort that comes with the disruption to the status hierarchy.   Others jump right into their new work, oblivious to the way that others will feel during this transition.  Empathy, in my view, is critical in this type of situation.  I would argue that the more empathetic individuals are able to move into a new management or coordination role more effectively.   

Friday, February 02, 2018

Misunderstanding The "Fail Fast" Philosophy

Many innovators adhere to IDEO founder Dave Kelley's philosophy: "Fail faster, succeed sooner." Recently, venture capitalist Chamath Palihapitiya took issue with Silicon Valley's embrace of this mantra during a talk at Stanford. He argued, 

“Fail fast” has become the conventional wisdom of Silicon Valley. And when it comes to consumer businesses and apps, that makes sense, says Palihapitiya. Consumer internet businesses like Facebook are about exploiting psychology, and businesses need to fail fast to keep pace with the shifting tastes and desires of consumers. But that formula doesn’t work for “anything that really matters,” he says. “It is not how you solve diabetes. It is not how you use precision medicine to cure cancer. It is not how you educate broad swaths of the world’s population.”

I strongly disagree with Palihapitiya's take here.  He has taken a far too narrow view of what the "fail fast" philosophy means.  Of course, a smartphone app is far different than curing cancer.  It's ok to fail if you launch a social media app into the market.   However, you do not want to put a poorly designed cancer drug out into the market simply to get feedback.  The FDA would not allow that anyway.   However, that does not mean the "fail fast" philosophy should not be applied in industries such as healthcare, where the stake are very high.   You can still embrace the notion that innovation should occur through an iterative process filled with prototyping, experimentation, and testing.   Prototypes come in many forms; they do not have to be finished products that could do potential harm to users in the marketplace.   

Thursday, February 01, 2018

Doing Less, Then Obsessing

My former colleague, Morten Hansen, has written a terrific new book titled, "Great at Work: How top Performers Work Less and Achieve More."   Hansen built a dataset of roughly 5,000 individuals from all levels of organizations, from the C-suite to the factory floor.  He examined their performance, as well as their habits, routines, and work practices.   In the book, Hansen describes seven principles that characterize the approach of top performers.

His first principle, and perhaps most interesting one, is "doing less, then obsessing." Hansen published an essay in the Wall Street Journal recently, in which he describes this principle. He writes, 

The common practice we found among the highest-ranked performers in our study wasn’t at all what we expected. It wasn’t a better ability to organize or delegate. Instead, top performers mastered selectivity. Whenever they could, they carefully selected which priorities, tasks, meetings, customers, ideas or steps to undertake and which to let go. They then applied intense, targeted effort on those few priorities in order to excel. We found that just a few key work practices related to such selectivity accounted for two-thirds of the variation in performance among our subjects. Talent, effort and luck undoubtedly mattered as well, but not nearly as much... In our data, people who focused on a narrow scope of work, and said no to maintain that strategy, outperformed others who didn’t. They placed an impressive 25 percentage points higher in the performance ranking—the difference between being a middling and an excellent performer.

Of course, setting priorities, and saying no to those things that are not priorities, can be extraordinarily difficult for many of us. We don't just work extra long hours to please our boss. We also take on too many tasks at times out of our desire to be collegial and to be viewed as a team player in the organization. We don't want to let our peers down. Sometimes we take on more work now, in hopes that our peers will reciprocrate when we ask for their help. The inability to focus can be costly though. It can diminish our productivity, increase our stress, and reduce the quality of the output that we create.

Monday, January 29, 2018

Why Corporations Love Strategic Planning: The Illusion of Control

Roger Martin has been a long-time critic of traditional strategic planning processes in many companies.  Several years ago, he wrote:

Virtually every time the word “strategy” is used, it is paired with some form of the word “plan,” as in the process of “strategic planning” or the resulting “strategic plan.” The subtle slide from strategy to planning occurs because planning is a thoroughly doable and comfortable exercise...This exercise arguably makes for more thoughtful and thorough budgets. However, it must not be confused with strategy. Planning typically isn’t explicit about what the organization chooses not to do and why. It does not question assumptions. And its dominant logic is affordability; the plan consists of whichever initiatives fit the company’s resources.  Mistaking planning for strategy is a common trap.  

Others also have been critical of annual strategic planning exercises.  Russell Ackoff once wrote,  “Most corporate planning is like a ritual rain dance: It has no effect on the weather that follows, but it makes those who engage in it feel they are in control.”  Indeed, human beings have a powerful need to feel a sense of control.  A sense of control actually has many positive benefits for people.  Some studies show that a strong sense of control fosters better mental and physical health.   Corporate planning exercises feed that need.  Of course, human beings are susceptible to what Ellen Langer calls the illusion of control, i.e. when we think we have much more ability to control outcomes than we actually have.  That illusion, as Ackoff suggests, drives a lot of the energy and effort poured into strategic planning.  

Thursday, January 25, 2018

Attracting Talent: What is Your Employer Brand Strategy?

Matt Handford, the SVP of People for Hootsuite, has written a good article for HR Morning about how to attract and retain talented employees in a tight labor market.  He focuses on your "employer brand" strategy.   Handford explains: 

It should go without saying that in order to develop a strategic and effective brand persona, there needs to be a plan behind it. First off, it’s critical to understand that a brand is not the perks or salary associated with working at your company. While perks like dog-friendly offices, free beer, extra vacation and ping pong are elements of creating a positive workplace it does not, and should not, define you as a brand.

Take a critical look at your current brand and define what you want to be known for; when a potential employee thinks of your company, what is the ideal perception you want to create? By thinking from that perspective, you can work backwards and develop steps to increase your brand’s strategic positioning until you are attracting the type of talent that aligns with your vision. Ultimately you want to capitalize on what makes your brand unique, and build from there.

Handford is right on the money.  The key question is:  How do you build such an effective employer brand strategy?   I would argue that it begins with an in-depth examination of your current competitive position in the labor market.  Clearly, you need to speak with your employees.  What does the brand mean to them?  More importantly, however, you must spend time with two other groups of people:  those who you hope to recruit (perhaps college students, for instance), and those who have rejected you.  The latter group is especially important.  You need to speak with those who have either connected with your firm in some way, but ultimately did not choose employment with your company, or those who have chosen not to engage with you at all.   What's driving them away?  Answering that fundamental question is the first step in building an effective employer brand strategy.  

Wednesday, January 24, 2018

Lifelong Learning: Think Deep AND Broad

The most successful leaders are lifelong learners.   As their career progresses, they master new skills and seek out experiences that will build their capabilities in key areas.  For many people, career development efforts focus on building expertise in a particular area.  They want to develop specialized knowledge of high importance to their organization, and hopefully, of high value to other firms in the marketplace.  Becoming an expert in a valued domain is certainly a good career strategy.  However, it's not enough.  Lifelong learning should involve broadening efforts, as well as deep dives in your area of specialization.   

You should ask yourself:  What adjacent domains should I be exploring?  What societal and technological trends should I be learning about right now?  Beyond that, you should seek out interesting topics, even if they don't seem directly relevant at the moment.   Become a bit of a polymath.  Such learning will stretch your mind and expose you to new ways of thinking.   Moroever, broadening your knowledge to new areas will help you in conversations and networking opportunities.  Being able to carry on a conversation on a variety of topics is a very useful skill as your career progresses.  

Imagine that you have an opportunity, as a young employee, to spend tim at dinner seated next to the CEO.   Could you carry on a conversation on a range of topics?  Would you be able to speak intelligently about issues outside of your specialization?   Answering these questions affirmatively proves to be very important if you hope to advance successfully in your career. 

Tuesday, January 23, 2018

Consolidation Has Not Helped the King of Beers Regain Its Crown

Source: Wikipedia
Fortune reports today that Budweiser is now the #4 beer in America. Thirty years ago, Anheuser Busch sold 49.2 million barrels of the core Budweiser brand in the United States, accounting for more than one in four beers sold. In 2016 the company only sold 14.4 million barrels of Budweiser. Today, Bud Light is the #1 beer in America, and the traditional Budweiser brand has fallen behind both Coors Light and Miller Lite. Of course, Budweiser's struggles are not unique.  Bud Light has lost volume as well over the past decade, as Americans turn to craft beers and imports.  According to Fortune, the top ten brands account for only 50% of the beer sold in America, whereas they once accounted for 2 out of every 3 beers purchased by consumers.  

The beer industry has consolidated dramatically in recent years, as brewers engaged in a wave of mergers and acquisitions.  While they have achieved considerable cost synergies, these mergers have not solved the fundamental growth problem that the mainstream brands have in the United States.  Consolidation often occurs when companies experience top line pressures.  That may help improve earnings in the short run, but often mergers do not recharge growth.  The King of Beers needs help, and the solution won't come from further dealmaking.  

Monday, January 22, 2018

Delegating Tough Choices to Avoid Responsibility and Regret

Mary Steffel and Elanor Williams have published a study on delegation in the Journal of Consumer Research.    They conducted a series of experimental studies to determine when and why consumers delegate difficult purchasing decisions.   They found that people tend to delegate tough choices to avoid responsibility/blame and to avoid the possible feelings of regret that emerge when one makes challenging decisions.  Steffel and Williams summarize their findings as follows:

This research shows that consumers cope with difficult decisions by recruiting others to choose for them. Across eight experiments, participants were more likely to ask others to choose on their behalf when choices felt difficult than when they felt easy. Delegation increased when choices felt difficult regardless of whether that feeling was because the choices themselves were more difficult (e.g., with a larger number of alternatives, with difficult tradeoffs, or with a smaller difference in relative attractiveness between the alternatives), or because the choices were processed less fluently for superficial reasons (e.g., the options were presented in jargon). Delegation increased when choices felt difficult regardless of whether the consequences were real or hypothetical and regardless of the importance of those consequences.

Does the same type of pressure and behavior emerge when managers make decisions at work?  It would be interesting to take a look at those situations, as opposed to consumer purchasing decisions.  

Thursday, January 18, 2018

What Information Do We Wish That We Had?

Over the years, Garold Stasser and his colleagues have demonstrated that many teams exhibit "shared information bias" - i.e. teams spend a great deal of time discussing information common to all team members, and they do not share, discuss, and integrate privately held information effectively.   As a result, teams make poor decisions because they do not leverage the unique knowledge and expertise of some team members.  

How can teams overcome the shared information bias?   People have described a variety of strategies, many focusing on a climate of psychological safety as well as strong process facilitation by the leader.   I would argue that one other techique can be very helpful.  Team members should ask the following question as they engage in collective problem solving:  What information or data do we WISH THAT WE HAD in trying to solve this problem?  Think about that question for a moment.  In most cases, team members focus on what they already know, rather than thinking about what information they wish they had in order to solve the problem.  By asking, "what data do we wish that we had," teams might encourage members to come forward with critical information that they might not have already shared for a variety of reasons.   In short, building a wish list might invite those who can help fulfill those wishes to come forward.  

Tuesday, January 16, 2018

The Hawaii False Alert: Is It Really Human Error?

Don Norman has written an outstanding article for Fast Company about the false alert that caused panic in Hawaii over the weekend.  In the aftermath of the incident, we heard that "human error"  caused the false alert to be transmitted widely to citizens of the state. Norman challenges this initial conclusion. Norman writes:

When some error occurs, it is commonplace to look for the reason. In serious cases, a committee is formed which more or less thoroughly tries to determine the cause. Eventually, it will be discovered that a person did something wrong. “Hah,” says the investigation committee. “Human error. Increase the training. Punish the guilty person.” Everyone feels good. The public is reassured. An innocent person is punished, and the real problem remains unfixed. The correct response is for the committee to ask, “What caused the human error? How could that have been prevented?” Find the root cause and then cure that. To me, the most frustrating aspect of these errors is that they result from poor design. Incompetent design. Worse, for decades we have known how proper, human-centered design can prevent them.

Norman points out several egregious design flaws with this alert system.  First, why was a confirmation not required before the alert was sent?  Ideally, he notes, the confirmation should be provided by a second person working independently from the person who selected the alert message.  Second, when operating in test mode, the messages should all start with a clear indication that it is only a test.  That should be in bold!  It should be capitalized!  It should be crystal clear!   Finally, the system should be designed to enable immediate correction.   The delay was preventable with better design.  

In sum, you can look at any failure in two contrasting ways.  You can examine it individualistically, i.e. it is human error.  Or, you can look at it systemically, i.e. what systems, procedures, and situational factors contributed to poor actions or decisions?   The latter approach is much more likely to lead to learning, improvement, and future accident prevention.   We have shown that in our own research on tragic accidents such as the Columbia space shuttle accident.   

Friday, January 12, 2018

Managing Promotions Effectively

How do you maximize employee productivity? To answer that question, many companies focus a great deal on the extrinsic reward system. Others recognize, rightfully, that intrinsic motivation matters more than the compensation scheme. These firms focus on the organizational culture, mission statement, and other factors that may shape the work environment and employee behavior. Jeff Haden, contributing editor, points out that one factor may be more important than all the rest. Here's an excerpt from this article:

A survey of over 400,000 people across the U.S. found that when employees believe promotions are managed effectively, they are more than two times as likely to give extra effort at work -- and to plan for having a long-term future with their company.  But wait, there's more: When employees believe promotions are managed effectively, they are more than five times as likely to believe their leaders act with integrity.  The result? At those companies, employee turnover rates are half that of other companies in the same industry. Productivity, innovation, and growth metrics outperform the competition.

Why such a significant impact with regard to promotions?  I think it's because employees care a great deal about what scholars call procedural justice.   In short, we don't just care abou the outcomes that we experience at work.  We care about the process by which decisions are made.  If we perceive those processes to be inequitable, unjust, or illegitimate in any way, then our commitment, satisfaction, and trust in leadership will decline.   So, as you think about promotions, remember that everyone is watching, not just the people in that particular department.  They are looking to see if the process is just.  

Wednesday, January 10, 2018

Reaching Your Goals: The Value of an "Emergency Reserve"

What are some techniques for helping individuals achieve their goals?  Wharton Professor Marissa Sharif has conducting some useful research on this topic.  She argues for the value of establishing an "emergency reserve" when setting objectives.  

Consider one experiment that she conducted.  She examined how people performed when setting goals for how steps they would walk each day.   For one group of research subjects, she asked them to try to reach their step goal (either 7,000 or 10,000 steps) during all seven days of the week.  For a second group, she asked them to try to achieve this objective during any five of the seven days.  Finally, for a third set of research study participants, Sharif asked them to reach their steps goal each of the seven days, but she provided them an "emergency reserve" in the form of two "skip days" that they could use at their discretion.  What did Sharif find in this experiment?   The people provided the skip days did a better job of achieving their step goals, and in total, they walked more steps during the week!  

Why is the emergency reserve so effective? Human nature seems to cause us to cling to those skip days. We don't want to use them unless it's a true emergency. People feel bad about using them simply because of a lack of willpower. That feeling causes us to walk more steps each day. 

Sharif also finds that individuals enjoy having emergency reserves. It makes them feel better about setting aggressive goals, and it makes them more likely perhaps to set out to achieve an ambitious objective. She concludes,

"I found that if people have these bigger goals of trying to lose weight or trying to become fitter, they prefer goals with emergency reserves to goals without. What this means is that not only can companies help their consumers perform better by incorporating emergency reserves into their goals, but they can also attract them to sign up initially by offering emergency reserves within their program."

Tuesday, January 09, 2018

The Middle Manager as Translator

Middle managers often are bombarded with information from above and below in organizations.  They must share directives and plans with the people working on the front lines of the organization.  At the same time, they must listen carefully to their team members and communicate their concerns, questions, and ideas upward in the organization.   In so doing, they play the role of translator in many cases.  Why?   Top executives and front-line employees do not speak the same language at times.  In fact, they speak starkly different languages - Greek and Japanese, if you will.  

Consider the goals established by senior management.   The CEO and his or her team often speak in terms of broad financial and strategic goals such as Return on Invested Capital, Market Share, Total Shareholder Return, and Asset Turnover.    The language fits the audience that they must deal with most regularly:  outside investors, Wall Street analysts, credit rating agencies, board members, and fellow members of the top management team.  

Consider, though, the meaning of this language system to front-line employees.  In many situations, they do not understand these goals clearly.  How exactly do you calculate Asset Turnover, and what does it say about the health of the organization?  Perhaps more worrisome, front-line workers may not care much about these objectives.  It's hard to imagine a retail cashier or assembly line worker, such as my parents, eager to get to work in the morning to achieve a higher return on invested capital.  What do they care about?  How do they find meaning in their work?  What motivates them?  The middle manager must answer those questions, and they must translate those top-level financial and strategic goals into a set of concrete objectives that are meaningful and important to the front-line employees.   Then, they must connect those objectives, and the work people are doing in pursuit of them, to the bigger picture.  In so doing, middle managers help workers understand the role they play in helping the firm achieve its larger objectives.   

At the same time, middle managers must listen carefully to their team members.  They speak their own language about the work being done, the concerns of customers, and the problems with the firm's processes and systems.   The middle managers must translate what they are hearing, so that they can communicate these issues clearly and concisely to top managers.  The middle managers must ask themselves:  How do these concerns or problems get in the way of achieving the firm's top level goals?  What resources and management support do my employees need to make the improvements that they suggest?  Top management may not understand these issues clearly, as they are so far removed from the work itself, and from the customers.  By translating their team members' ideas and concerns appropriately, middle managers can achieve the type of alignment required the organization and its employees to thrive.  

Monday, January 08, 2018

Big Data and The Analytics Paradox

Kellogg School Professor Eric Anderson describes an interesting phenomenon that he calls the “Analytics Paradox.”  Anyone grappling with how their firm employs data science as part of their business strategy should become familiar with this concept.  Anderson explains:  

A young firm starts out making many mistakes. Eager to improve, they collect lots of data and build cool new models,” he says. “Over time, these models allow the young firm to find the best answers and implement these with great precision. The young firm becomes a mature firm that is great at analytics. Then one day the models stop working. Mistakes that fueled the models are now gone and the analytic models are starved."

Anderson offers an example of the analytics paradox.  Imagine that a firm provides two-day delivery services.    They consider using data analytics to help make an important decision: whether or not to offer one-day delivery services to customers.  You might be hard-pressed to answer that question using analytics.  Why? An effective organization becomes proficient at executing two-day delivery.  If the firm can't meet two-day delivery deadlines on a regular basis, processes and systems are changed.  Employees who can't meet the two-day delivery schedule get admonished or even dismissed.  In short, a firm that is very effective at execution will drive all variability out of its "production" system.  Yet, without variability, you will find it very difficult to use analytics to drive improved decision making. 

What can you do to conquer the analytics paradox?    Put simply, you need to inject variability into your system by promoting thoughtful and systematic experimentation.   The use of experiments enables you to test different models and systems, and in so doing, generate the type of data that can be analyzed effectively to enhance decision making.  

Saturday, January 06, 2018

How You Think vs. What You Know

Philip Tetlock wrote a terrific book last year titled Superforecasters.  In that book, he describes the  decades of research he has conducted on expert predictions. Put simply, he has found that experts don't make great prognosticators, despite their vast knowledge and experience. Knowing a great deal does not enable you to see the future. In fact, it can be a handicap at times, because you may be tied down by conventional wisdom, long-held assumptions, and pre-existing beliefs. In Tetlock's research, he has found that a small set of people have an uncanny ability to make accurate predictions. These people are not experts in the domain in which they made those forecasts. What enables them to predict so effectively? Tetlock conclues that the key is HOW THEY THINK, not what they know. The best forecasters exhibit the following characteristics:
  • They are open-minded, reflective, and intellectually curious. 
  • They acknowledge what they do not know. 
  • They gather information from a wide variety of sources and question the validity of each source. 
  • They enjoy pondering a range of diverse views, and they update their conclusions as facts change. 
  • They treat beliefs as testable hypotheses rather than hard truths.
In my view, the same might be said about the best leaders.  They often distinguish themselves by how they think, not what they know.   The best leaders are reflective and intellectually curious, question the conventional wisdom, do not become wedding to existiing beliefs, admit what they do not know, critique the validity of information sources, and gather diverse opinions before making key decisions.  

Tuesday, January 02, 2018

Nick Saban and the Power of Small Wins

One more blog post about goal setting as the new year begins!  At this time of year, I always find it useful to reconsider Karl Weick's famous article about the power of small wins.   He wrote the article back in the 1980s, and it still resonates so powerfully today.  Here's an excerpt:

A small win is a concrete, complete, implemented outcome of moderate importance. By itself, one small win may seem unimportant. A series of wins at small but significant tasks, however, reveals a pattern that may attract allies, deter opponents, and lower resistance to subsequent proposals. Small wins are controllable opportunities that produce visible results... Once a small win has been accomplished, forces are set in motion that favor another small win. When a solution is put in place, the next solvable problem often becomes more visible. This occurs because new allies bring new solutions with them and old opponents change their habits. Additional resources also flow toward winners, which means that slightly larger wins can be attempted.

As you think now about setting ambitious goals for yourself and your organization, develop a "small wins" strategy as well. What are those near-term victories that you will achieve that will create a sense of accomplishment, persuade naysayers to support your efforts, and attract other allies?  

Last night, the University of Alabama defeated Clemson in the college football semi-finals.  Alabama Coach Nick Saban will now have an opportunity to win sixth college football national championship. Saban understands the value of a small wins approach. Naturally, each season begins with the long term goal of winning another national title. However, he focuses on many small wins along the way, rather than dwelling on the big picture each day. He calls it "the process." Author Ryan Holiday describes how Saban addresses his team throughout the season: 

Don't think about winning the SEC Championship. Don't think about the national championship. Think about what you needed to do in this drill, on this play, in this moment. That's the process: Let's think about what we can do today, the task at hand.