“If you try to be everything to everyone, you end up being nothing."

Source: Fibre2Fashion.com 

Suzanne Kapner has written a great article about The Gap in the Wall Street Journal this week. She describes in great detail the formidable challenge facing new CEO Sonia Syngal.  The long-running troubles at The Gap are summarized most eloquently by Ivan Wicksteed, former chief marketing officer at Old Navy (one of the retail chains operated by The Gap Inc.).  The article quotes him directly: 

The brand “hasn’t articulated what they stand for,” said Ivan Wicksteed, a former chief marketing officer at Old Navy who left in 2015 and now works for a health-care-technology company. “If you try to be everything to everyone, you end up being nothing.

Kapner describes the roller coaster ride at The Gap over the past decade, as the firm's struggles have mounted:

Over the past decade, the Gap brand has careened from one look to another. One year, according to former executives, it wooed younger, budget-minded consumers by competing with fast-fashion chains. The next, it went after higher-income shoppers by selling $600 leather jackets.

The company operates major retail chains:  Gap, Banana Republic, Old Navy, and Athleta.  Interestingly, the Gap stores themselves are the weak link at the company.  In large part, that's because the Gap brand has the most muddled competitive positioning.  Old Navy has a solid low cost positioning.  Banana Republic competed with a differentiated, premium price strategy targeting a very different set of customers than Old Navy.   The Gap, however, remained stuck in the middle.  It didn't have the low costs of many major rivals, including its own Old Navy brand, nor the cache to command higher prices.  

Moreover, the Gap wavered over the years between a "selling the basics" strategy more akin to Uniqlo and a "fast fashion" strategy pioneered and mastered by firms such as Zara.   The two strategies require completely different business models:  different supply chains, different management control systems, different store operating models, different types of people in key positions.  Zara's entire business model is tailored toward fast fashion.  In other words, its vertical integration strategy is not well-suited to delivering low prices on basics.  It is, however, very well-positioned to offer trendy fashion in a way that minimizes the downside of "fashion misses" and curtails the need for hefty markdowns.  

In sum, Syngal will have to decide who she wants The Gap to be, and then build an entire business model tailored to deliver that value proposition. It will mean making tough tradeoffs and targeting a particular set of customers, rather than trying to be all things to all people.  

Preparing for a Great Meeting: Spotify CEO Daniel Ek

Source:  Wikimedia

The Observer Effect has published a fascinating interview with Daniel Ek, CEO of Spotify.    Ek has a clear and concise take on how to tackle important issues, define his role in the decision-making process, and design effective group meetings.  Here's an excerpt on how he thinks about defining his own role in the decision process in advance of discussions with his team members:

I typically tackle one topic a day which takes a lot of my time. That's my big thing for the day. Before we go into a live team discussion on that particular topic, I invest time to prepare beforehand – reading and talking to members of the team who are either part of the decision-making process or who have insights and context. I sometimes even get external perspectives.

I also think about what my role is at that meeting. Sometimes I'm the approver. Other times, I'm supposed to come with a thoughtful perspective on whether an initiative makes sense or not.   I’ve found that creating this clarity of role for myself is critical. It’s something I challenge my direct reports to think about as they engage with their own teams. I remind them that all meetings are not the same. Even when we are meeting to discuss really, really complicated topics I always ask myself: “What am I going to do in this meeting? What does my involvement really need to be?”

The truth is: it's entirely contextual. I find it crucial to be upfront about everyone’s role in different meetings, I think this is super, super important. Often that's my number one thing: to make sure I know what role I'm playing.

Then, Daniel Ek explains the critical attributes of a highly effective team meeting.   Here's another excerpt from the interview:

A great meeting has three key elements: the desired outcome of the meeting is clear ahead of time; the various options are clear, ideally ahead of time; and the roles of the participants are clear at the time.

I often find that meetings lack one of those elements. Sometimes they lack all those, which is when you have to say, “This is a horrible meeting, let's end it and regroup so it can be more effective for everyone.”

To clarify outcomes, options, and roles ahead of time, we sometimes rely upon a preread. Prereads are a great way to share context so that attendees can quickly get into the meat of the issue and not waste time getting everyone up to speed.

I've always believed that the best leaders think carefully, in advance, about how to structure the decision-making process.  Moreover, they are thoughtful about their own role in that process. Ek does a nice job of articulating the value of this approach from the perspective of a leader running a large, fast-growing organization.  

Don't Tell Them Your Opinion First!

Annie Duke, author of the new book , How to Decide: Simple Tools for Making Better Choices, participated recently in an interview with Katy Milkman, professor at Wharton. Professor Milkman asked the author which lesson from the book was her favorite. Here's Annie Duke's response... simple, but very important advice for leaders making tough decisions, yet often not followed: 

I think my favorite concept in the book is really simple, but really powerful. If you want somebody’s opinion, don’t tell them your opinion first. It sounds so simple and almost dumb when you hear it, except that nobody does it. When I read an opinion piece and send it [to someone else], I’ll say, “I think they’re cherry-picking the data, and I think the author is biased, and I cannot even believe that someone was willing to say this out loud. What do you think?”

We do that, not just about opinion pieces or TV shows, but also about feedback when it comes to a sales strategy, or whether we should make a particular investment, or who we should hire. We’re asking for people’s feedback, but we’re always offering the very feedback we’re trying to get from them first.

Don't Assume; Empathize First

Take a look at this brief video featuring Ed Batista, a Stanford Graduate School of Business lecturer and executive coach. He talks about the strategic importance of empathy. He argues that we often make a series of assumptions when we confront someone whose decisions or actions seem befuddling or even maddening. Rather than make assumptions, we should try to stand in their shoes, and ask ourselves: What is the reason they are making that argument, initiating that conflict, or making that seemingly unjustifiable decision?  What's behind their frustrating course of action?  Challenging our own assumptions can often help us find a path to more effective interaction and potentially collaboration.  

Two Quite Different Questions that Begin: "What's the Worst Thing..."

Source:  The Clorox Co.

The Wall Street Journal recently ran a feature on the new CEO of Clorox, Linda Rendle.  She has become one of the youngest Fortune 500 CEOs.  Toward the end of the article, Rendle describes how she approaches making tough decisions regarding potentially bold new initiatives.   She reflects, in part, on her work years earlier launching the Green Works line of cleaning supplies.  

Ms. Rendle said she recalls feeling nervous ahead of the 2007 Green Works meeting, having mentally laid out an argument for why the company should implement a widespread rollout of the brand instead of the limited, niche launch executives were planning. At the time, so-called green cleaning products were a minute part of the mainstream market.

“Before I do anything that’s hard, I say: ‘What’s the worst thing that will happen if you do this?’” she said. “And: ‘What’s the worst that will happen if you don’t?’”

In my experience, many managers ask themselves the first question about the worst case scenario.  However, they don't pose the second question.  What is the cost of inaction?  Could we miss a terrific opportunity? Will rivals gain the upper hand?  I think managers should follow Rendle's lead here.  They must ask themselves both questions when approaching tough decisions about high stakes, risky new initiatives. 

Lessons on Curiosity from the Latest Nobel Prize Winner in Chemistry

University of California-Berkeley Professor Jennifer Doudna earned the Nobel Prize in Chemistry this week. We can learn a great deal from her about the importance of curiosity, and how we can nurture that it in our employees and our children. Click here to read a short excerpt from my book on creativity, in which I describe a few lessons we can take from Doudna's upbringing.

Changes in Leadership, Reflection, and Reduced Commitment to Outdated Plans

University of North Carolina scholars Hanna Kalmanovich-Cohen, Matthew Pearsall, and Jessica Siegel Christian have published an interesting new study in a paper titled, "The effects of leadership change on team escalation of commitment."  The authors completed two studies as part of this research project.  In one of those studies, they conducted an experiment using the Food Truck Challenge simulation that I created in partnership with Harvard Business Publishing.   In the simulation, students try to maximize revenue for a food truck business.  To accomplish that goal, they must try to determine the optimal location and menu for the truck.  

The scholars created teams of three students and assigned a leader to each group.   For 1/2 of the teams, the researchers changed the group leaders after the first round of the simulation.  For the other teams, the leader remained the same throughout the game.   The scholars wanted to understand whether a change in leadership would reduce commitment to outdated plans.  Would new leaders engage in thoughtful reflection with their team about past choices? Would they examine feedback and adapt more effectively?   The researchers summarized their findings as follows:

We found evidence that a new leader promoted reflection behaviors within the team and reduced commitment to outdated plans. Therefore, teams that experienced leadership change avoided escalation of commitment over time. Further, such teams were better able to respond to feedback, to identify and correct errors in their updated plan and make course corrections by focusing on error reduction. In contrast, teams with ongoing leaders were more likely to remain committed to their initial plans, which then lead to greater escalation behavior and less of a focus on error reduction in the next performance episode.

What's the practical implication of this research finding? The scholars elaborate:

Leaders and teams can be trained in situation assessment, and to question whether objectives and methods are still appropriate and whether alternative courses of action may be viable, especially following environmental or other changes (Gurtner, Tschan, Semmer, & Nägele, 2007; Konradt et al., 2016). By finding ways to incorporate reflection into their regular activities, employees can better understand their actions and carefully diagnose the gap between what actually happened with what should or could have happened.

The results may not surprise us, but they remind us of the powerful impact that sunk costs can have on our decision making.   Moreover, the study demonstrates the importance of reviewing and evaluating our past decisions critically, being willing to updating our beliefs as new evidence emerges, and being open to adapting in the face of results that did not meet expectations.  We shouldn't need a new leader to shed outdated plans.  We need to get better at doing so without a change in leadership.  However, we also must remind ourselves that a new leader alone, without critical reflection, will not save us from poorly designed and seriously outdated plans.  

Others' Failures Are Valuable Learning Opportunities

Source: Flickr

Let's face it: we often are pretty bad at learning from our own failures. We make excuses, blame uncontrollabe external causes, and argue that we simply have to "move on" and not dwell on the past. What about learning from others' failures? Can we improve by examining others' mistakes carefully and systematically? Bledow, Carette, Kuhnel, and Bister conducted an experimental study several years ago on this subject. They published an article in the Academy of Management Learning and Education titled "Learning from others' failures: The effectiveness of failure stories for managerial learning." In a training setting, they gave research subjects stories about others' failures or successes. The stories all provided the same learning content, whether failure or success. They examined whether failures stimulated more learning than successes. Here is an excerpt from the paper, in which they explain their results: 

In support of the reasoning that failure stories stimulate deep information processing and result in enhanced learning transfer, we found that listening to others’ managerial failures led to more elaboration as compared to listening to other people’s managerial successes. Intensified elaboration, in turn, yielded higher transfer of newly acquired knowledge to a subsequent task. This effect was more pronounced for people who see failure as a valuable source of learning...

Because failure and success stories conveyed the same learning content and differed only in the way it was presented, framing of the learning content as a failure triggered the motivation to process the stories more thoroughly. Learners responded to the negative valence of failure stories with increased elaboration, which then resulted in enhanced learning. This study thus supports the assumption that a motivational mechanism is at play and yields the learning benefits associated with being exposed to others’ failures.

I should stress that I don't think we should conclude that learning only comes from failure. In fact, other studies demonstrate that powerful learning comes from being able to COMPARE successes with failures. In so doing, we get better at determining the true causes of particular good or bad results. Tel Aviv University scholars Schmuel Ellis and Inbar Davidi examined after-action reviews conducted by Israeli military units. They compared units that conducted post-event reflection exercises after successful and unsuccessful navigation exercises with those who only examined failures.   They discovered that groups who evaluated both successes and failures developed a richer understanding of the drivers of good and bad outcomes.  People who studied both successes and failures performed better over time than those who only studied failures.