How Your Imagination Can Make You a Better Negotiator

Source: Sarah & The Spider (Flickr)

When negotiating, we would love to have a strong BATNA (best alternative to a negotiated agreement).  In those instances, the attractive fall-back plan enhances our leverage at the negotiating table.  Moreover, it boosts our confidence as we negotiate with a counterparty. 

What happens, though, if we don't have a solid alternative? Are we doomed to be a very weak position at the negotiating table? Michael Schaerer, Martin Schweinsberg, and Roderick Swaab have explored these questions in a new paper titled, "Imaginary alternatives: The impact of mental simulation on powerless negotiators."   They find that imagining an attractive alternative can have beneficial effects, even when no such option exists.  The scholars summarize their findings:

The present research demonstrates that negotiators can act powerfully without having power. Researchers and practitioners advise people to obtain strong alternatives prior to negotiating to enhance their power. However, alternatives are not always readily available, often forcing negotiators to negotiate without much, or any, power. Building on research suggesting that subjective feelings of power and objective outcomes are disconnected and that mental simulation can increase individuals’ aspirations, we hypothesized that the mental imagery of a strong alternative could provide similar psychological benefits to having an actual alternative. Our studies demonstrate that imagining strong alternatives causes individuals to negotiate more ambitiously and provides them with a distributive advantage: negotiators reached more profitable agreements when they either had a strong tendency to think about better alternatives (Study 1) or when they were instructed to mentally simulate an attractive alternative (Studies 3-4). 

The findings demonstate the incredible power of our imagination, and they warrant further investigation outside of the laboratory.  

The Benchmarking Mindset

In this new animation video, we briefly tell the story of the Survivor reality TV show debut and Hollywood's tendency for copycat behavior. You'll also discover what you can learn about creativity from rock legend Dave Grohl & his idols, The Beatles. 

The Office of "How" - not "No"

Source:  Symantec

Adam Bryant of  Merryck & Company recently posted a terrific LinkedIn article, in which he interviewed  Amy Cappellanti-Wolf, Chief Human Resources Officer at Symantec.   In the interview, Cappellanti-Wolf talked about making the transition to a technology firm (having worked at Disney and Frito-Lay previously).   She notes:

I had a couple of interviews where I was told, “You don’t have a technology background.” I had to say, “It doesn’t matter. I’m smart and agile and can learn quickly.” I had to prove myself, check my ego at the door, and show that I’m a lifelong learner who can get my hands dirty and connect with people who really get the business, so I could learn to speak their language. 

Once you begin to speak their language, they’re more apt to bring you into these conversations, rather than seeing you as a corporate HR person who isn’t really commercial. And commercial is the word I use often to describe myself, because I’m not about building policies or rules. I think rules can take away choices. I want to be the office of “how,” not the office of “no.”

That final sentence really struck me.  To drive creativity and innovation in organizations, we need to create a workplace environment of "how" rather than "no".   How can we make this work?  How might overcome those challenges?  How could we address the shortcomings of this proposal, without discarding the idea altogether?   Before we simply poke holes and reject flawed ideas, we need to ask "how" we might be able to improve those ideas or build upon them.   We also can't simply expect to govern behavior by rules and procedures.  We have to give some autonomy to our people and trust them to make good decisions, given appropriate guidelines, training, and mentorship.  

LEADx Podcast

Check out the latest LEADx podcast episode in which I discuss the benchmarking curse, the challenge of dealing with naysayers, and the ways in which we can achieve psychological distance so as to stimulate creativity.  Great stories about the TV show Survivor and many other instances of creativity or the lack thereof. 

Do We Actually Want Some Dissatisfied Employees?

https://www.flickr.com/photos/intelfreepress/8576174720

MIT researcher George Westerman has written a provocative post on the MIT Sloan Management Review website. The title of his short article is, "The New Digital Mandate: Cultivate Dissatisfaction."  Westerman writes:  

The problem is that employee satisfaction can be a double-edged sword. While satisfied employees are good for current activities, that very satisfaction can inhibit innovation. Transformative innovation is difficult. It is far easier to stick with what we know works and tweak the current process than it is to start over. People who are satisfied with the current way of doing business are not likely to transform it.

People who transform their organizations must be aggravated enough with the current situation that they’re willing to bear the effort and risk to change it. Leaders who want their organizations to continuously transform must not only look for dissatisfaction on which to capitalize, but also be willing to cultivate dissatisfaction in their employees.

Westerman argues that there is a right and a wrong way to be "dissatisfied" in an organization.   A useful form of dissatisfaction involves a willingness to question the conventional wisdom and the commonly accepted ways of doing things.   It means protecting the organization against complacency.   The wrong type of dissatisfaction involves pointing fingers and blaming others for problems that arise, while not offering constructive alternatives.   

I agree wholeheartedly. A certain amount of healthy and constructive restlessness can be a powerful positive force in an organization. Andy Grove, long-time CEO of Intel, once argued that organizations need to have a few "helpful Cassandras" who can bring some healthy paranoia to the table.  Grove once wrote, "I believe in the value of paranoia. Business success contains the seeds of its own destruction."  Of course, what you do not want are naysayers who simply look for all the reasons a new idea won't work.  You don't want people who are stopping innovative ideas in their tracks.  You would like people who are looking broadly for potential threats to a firm's competitive advantage and are protecting against complacency.  

Creativity is for Everyone

I would like to hear from you! What is ONE INSPIRING THING that leaders can do to stimulate the creativity of their team members? Hope to write a LinkedIn article describing some of your favorite methods. Please leave your thoughts as a comment here on the blog. Thanks!

Straddling: Whole Foods Discontinues 365 Store Format

Source: Wikimedia Commons

Supermarket News reported yesterday that Whole Foods will not be opening additional 365 format stores. The company had launched the small-format 365 stores two years ago in an attempt to provide a less expensive option targeted at millennial shoopers.   CEO John Mackey explained the move in a memo to his staff: "However, as we have been consistently lowering prices in our core Whole Foods Market stores over the past year, the price distinction between the two brands has become less relevant. As the company continues to focus on lowering prices over time, we believe that the price gap will further diminish."  Count me as someone who was skeptical of this strategy even before Amazon acquired Whole Foods and began to lower prices in the traditional stores.  Let's take a look back at the original rationale for the 365 stores.  Annie Gasparro of the Wall Street Journal reported on the strategy in 2016:

Announcing the plan last month, executives said these new stores would have a trendier atmosphere, with high-tech ways of interacting with shoppers that help keep its costs down.  Some retail analysts said the value-focused chain, which is expected to largely carry private-label foods, could help Whole Foods compete with Trader Joe’s, which tends to attract younger shoppers who want affordable, natural foods.

A Reuters article by Lisa Baertlein, published in 2016, revealed some skepticism about the 365 strategy by industry analysts:

“Our goal is to compete in the marketplace without lowering the Whole Foods standards,” Turnas told Reuters during a recent store tour. He said 365 stores will complement Whole Foods’ premium, full-service sister brand – often dubbed ‘Whole Paycheck’ in popular culture in reference to its perceived higher prices. But the new chain will have to work hard to avoid being labeled “a cheaper Whole Foods”, said Kevin Kelley, a principal at strategy and design firm Shook Kelley, which has worked with Whole Foods and other grocers.

Why did the 365 format struggle to gain traction?   I would argue that it's a classic example of a straddling strategy.   The 365 format was caught somewhere in between the traditional business model of Whole Foods and the very successful contrasting business model at places such as Trader Joe's.  For more on Trader Joe's, you might check out a recent Freakonomics episode in which I participated.   Straddling often occurs when incumbent players try to react to successful entrants.  Consider how the legacy airlines tried to cope with entrants such as Southwest and Ryanair.   Among the failed responses were straddling strategies such as United's Ted, Delta's Song, and British Airways' Go brands.  For more on straddling, check out this short video clip from one of my Great Courses lecture series. 

Blue, Yellow, and Green Ideas? A Conversation with Sarah Osteen on the Swayed Podcast

What's the difference between blue, yellow, & green ideas, and why does that matter? What can we learn about creativity from Planet Fitness?  These topics & more in my conversation with Sarah Osteen on her Swayed podcast this week.

Winston Churchill, Groupthink, and the Dardanelles

Source: Wikipedia

I'm reading Andrew Roberts' masterful biography of Winston Churchill right now.   I've discovered some terrific lessons in decision making.    For instance, the Dardanelles disaster in World War I offers a fascinating example of groupthink and overconfidence, as well as the risks when advocacy crowds out inquiry in a decision-making process.   Roberts describes a key War Council meeting on January 13, 1915: 

Because Churchill seemed to be giving the Admiralty's collective view, none of the politicians asked Fisher or Wilson for their thoughts, and they remained silent throughout the meeting.  It wsa therefore assumed that they were in favour, which they were not. "Neither made any remark and I certainly thought that they agreed," Churchill wrote later. "He was my chief," Fisher would say, "and it was silence or resignation."  

Unfortunately, Churchill did not recognize that silence does not equal consent.  Neither Churchill nor any of the other War Council members inquired as to the views of key military experts.   They did not invite more discussion and input, and certainly did not seek dissenting views.  Roberts writes, "A collective 'groupthink' permeated the meeting of 13 January, encouraging optimism and discouraging incisive questioning, a problem made all the worse by Fisher 's and Jackson's silence."  He derives his conclusion after quoting the conclusions from the Dardanelles Commission's official report about the military debacle: 

Mr. Churchill thought that he was correctly representing the collective views of the Admiralty experts.  But, without in any way wishing to impugn his good faith, it seems clear that he was carried away by his sanguine temperament and his firm belief in the success of the undertaking which he advocated... Mr. Churchill had obtained their support to a less extent than he himself imagined... Other members of the Council, and more especially the Chairman (Asquith), should have encouraged the experts to give their opinion, and indeed, shoud have insisted upon their doing so.

I highly recommend Webster's book, though I have to warn you that it approaches 1,000 pages in length.  However, I've found it to be an incredible enhancement to my understanding of leadership.  

Forbes Interview with Andy Molinsky

What advice do you have for young professionals about how to unlock their own creative thinking? I’m the CEO of a startup and I think I have the next big idea in my industry. What can I do to make sure I don't fall victim to the barriers to creativity you outline in your book? I answer these questions and more in this Forbes column by Brandeis Professor Andy Molinsky.

Lessons in Creativity from U2, Mark Twain, and The Beatles

Source:  Billboard

Check out my article on LinkedIn to learn more about what we can learn about creativity from two legendary rock bands and one of America's greatest novelists. 

Unlocking Creativity: The Resistance to New Ideas

Here's a brief video clip explaining some of the reasons why we face a persistent resistance to new ideas in many organizations. 

Unlocking Creativity Released Today, January 7th!

Thank you to everyone who helped and supported me throughout the process of writing my latest book, Unlocking Creativity.   The book launches today, published by Wiley.  Here's a quick recap:

If you think your enterprise needs to hire its way to creativity, think again. Established organizations have all the creative talent they need already in their ranks. You just need to activate this latent potential, making room for the original thinkers to flourish. In Unlocking Creativity, you will learn to recognize and understand the six organizational mindsets that block creativity—and strategies to overcome them.

For more information, check out the video below, read my latest LinkedIn article (Lessons in Creativity from U2, Mark Twain, and The Beatles), listen to this recent podcast interview, or visit my website.

Herb Kelleher's Legacy at Southwest Airlines: 5 Important Lessons

Source: Southwest Airlines

Yesterday, Southwest Airlines co-founder and long-time CEO Herb Kelleher died at age 87. He led Southwest through turbulent economic times as well as periods of economic growth. While many of his rivals went bankrupt over the years, Southwest prospered. The company delivered strong profits, satisfied its customers, and kept its employees engaged and productive. What can we learn from Kelleher’s leadership at Southwest? Here are five simple, yet powerful, lessons that come to mind as I reflect on the Kelleher era at the airline:

1. Make tradeoffs. To create and sustain competitive advantage, especially in a brutally competitive industry, you have to zig when others zag. You can’t just follow the herd. At Southwest, Kelleher chose to run an airline in a very different manner. He made clear strategic tradeoffs, choosing not to do what many competitors often did. For instance, he chose not to create a hub and spoke system, not to assign seats, not to offer meals, and not to provide interline service. 
2. Harness the power of simplicity. Kelleher once said, “"I can teach you the secret to running this airline in thirty seconds. This is it: We are THE low-cost airline. Once you understand that fact, you can make any decision about this company`s future as well as I can.“ 
3. Compete with your substitutes. In a fabulous 60 Minutes feature many years ago, Kelleher discussed some pushback that he had received from shareholders one time. They wondered why he was charging $40 or $50 less than competitors on a particular Texas route. They asked, “Why not charge $20 less and generate more profits?” Kelleher explained that they didn’t understand his strategic philosophy. He wasn’t competing with other airlines. He was competing with substitutes, such as automobiles and trains. The Southwest fare at the time between two particular Texas cities was LESS than what it cost to drive a car between those destinations. By defining the competition in this way, Southwest didn’t just take share from industry rivals; they grew the market substantially. You have to remember that you are competing with substitutes, not just direct rivals. 
4. Think systemically. Building a great airline isn’t just about buying the right planes, choosing the right routes, adopting the best marketing practices, or even attracting the best talent. It’s about ALL of those things. You have to think systemically if you want to build and sustain competitive advantage. At Southwest, all their key choices fit together. To emulate their success required more than just benchmarking a few best practices. You had to understand and replicate the entire system, and that was extremely difficult for rivals to do. 
5. Focus on the intangibles. Kelleher once remarked, “What keeps me awake at night are the intangibles. It’s the intangibles that are the hardest thing for a competitor to imitate, so my biggest fear is that we lose the esprit de corps, the culture, the spirit. If we ever do lose that, we’ll have lost our most important competitive asset.”

Video Jungle Podcast

Learn about my secret to great eggplant parmigiana, my teaching philosophy, and a bit about my research on creativity too in this episode of the Video Jungle Podcast from Animus Studios.  I enjoyed the banter with former student (Bryant alum) Justin Andrews and his colleagues.  Click here to listen. 

Novelty Stimulates Curiosity and Creativity

Source: Blue Diamond Gallery

If you want to encourage creativity, exploration, and learning on your team, you should think carefully about how to introduce and provide novel experiences. Scientists Nico Bunzeck and Emrah Düzel have shown that the brain responds to novel stimuli in a manner that increases exploration and learning. 

As a leader, you can provide new stimulating experiences for your employees through travel, reading, training, or a challenging new assignment.    You might ask them to join a new cross-functional project team, or work on developing a new skill.   You could ask them to study a new technical issue or explore a geographic market of which they have little prior knowledge.  

Novelty may not pay dividends overnight, but it will stir the creative juices over time.  Of course, you will have to warn your team members:  novel exploration and learning can be disconcerting, challenging, and unsettling at times.  At advertising agency WPP,  executive Tor Myhren once banned meetings for three hours on one morning each week.  He wanted time for people to work on issues that might otherwise get pushed aside by the day-to-day grind of meetings and schedules.  Gina Sclafani, one of his employees, noted that she was excited initially about this time to explore new ideas.  Then, she realized that it was very difficult to move outside of her comfort zone.  However, she found this uncomfortable process of inquiry and discovery to be very beneficial over the long run.    No pain, no gain... of course! 

Creating Lasting Habits

As we begin January, many of us are thinking about goals that we would like to achieve in the coming year.  Check out this terrific Fast Company podcast with best-selling author Charles Duhigg in which he talks about creating lasting habits.   He's the author of a great book titled, "The Power of Habit" - published seven years ago.

New Facebook Professional Page

For those readers who are interested, I've launched a new Facebook Professional Page.  I hope you will check it out.  You also can follow me on Twitter if you wish.