Kelly Johnson & Lockheed Martin's Skunkworks

 

I'm reading a terrific book by Josh Dean.  The title is The Impossible Factory: The Remarkable True Story of Kelly Johnson and the Lockheed Skunk Works, America's Innovation Machine.   The book chronicles the history of this famous highly secretive research and development organization at Lockheed.  Moreover, it explores the principles of organization and leadership that Kelly Johnson developed to manage the Skunk Works.  I found one particular passage about Kelly Johnson illuminating, since it highlighted how a powerful, often intimidating leader could accept bad news and change his mind.  The story focuses on a young engineer, Dick Heppe, challenging Johnson's view on the design of a plane's tail.  

"Heppe was in awe of Kelly, who was already, by this point, 'a legend' to young engineers like him.  And suddenly he had to sit in front of the man himself and tell him that he needed to make his plane's tail much larger. 'I was, frankly, trembling in my boots,' Heppe recalled.  Kelly did not dismiss the young engineer or get angry at him for bearing bad news.  He listened, asked questions - prodding for mistakes - and then accepted Heppe's conclusion.  

'It's a bitter pill,' Kelly said, 'but you're right.' 

He assigned an engineer, on the spot, to go redesign the tail. 'So that taught me the first lesson about Kelly,' Heppe recalled, 'which was that, if you knew what you were doing and you can satisfy his probing to a reasonable degree, he would trust you.' 

This trait - that a confident, intimidating, often intractable genius could accept bad news, even from underlings - instilled great confidence in his workers. Which only made them want to work more, and harder. 

The story speaks for itself.  Johnson did not dismiss Heppe.  He listened, asked questions, and remained open-minded despite his strong convictions.  He let the evidence speak.   Most of all, he demonstrated the type of curiosity that great leaders must exhibit.  

Costco Case Study

My newest case study is now available through the Harvard Business Publishing catalog. The case is titled Costco Wholesale Club: The Gas Station Strategy. The case examines the company's competitive strategy, and then it dives deeply into the rationale behind this year's grand opening of the first Costco standalone gas station.

Fumbling Customer Service Handoffs

Source: NY Times

In healthcare, practitioners have been paying attention to "handoffs" for quite some time in an effort to improve patient safety.  An handoff is when a patient is transferred from one clinical team to another, or when critical information about a patient is transferred from clinician to clinician.  Fumbling a handoff can lead to a serious medical error.

Now, KPMG's Scott Lieberman argues that similar fumbled handoffs lead to many customer service problems at companies.  In Fast Company, Lieberman writes:

Ask your department heads how things are going, and you’ll hear good news. Leads and engagement are up, sales hit quota, and customer service is chipping away at response time. Every dashboard is green.

But ask your customer, the one that’s been passed along three times in five minutes between chatbots and agents and intervention specialists, and you’ll get a different report. Because she’s explaining her story for a fourth time: This company knows my birthday, my shopping history, and my shoe size. But they can’t remember the conversation they had with me 60 seconds ago.

And yet both things are true. Your dashboard is green, and your customer is on a hamster wheel. That’s the trap. Companies grade their performance one department at a time. But your customer is grading based on her experience of one company, start to finish, and the whole operation’s getting a D-plus.

The gap between those two scorecards lives in the handoffs—the moments a customer passes from one team to another—and that’s precisely where most companies are struggling.

Lieberman's description rings true for those of us who have called a customer service center recently.  The process can be maddening, particularly when you are transferred from one department to another.  Understanding how customers live through an entire process is critical.  How often must they be transferred? For what reasons?  How often do they get frustrated and hang up?  What information must be constantly repeated because it is not transferred effectively?   Solving these pain points requires understanding the ENTIRE customer journey, and that often can be very complicated.  

Too Many Meetings? But Are They The "Broccoli of Work?"

Source: Getty Images

Day after day, I read articles in which employees complain about too many meetings and writers offer advice for eliminating the unnecessary meetings that clog our schedules.  Yet, a new study offers strong empirical evidence of the value of meetings.  David Deming and his colleagues have authored a National Bureau of Economic Research working paper that describes meetings as "the broccoli of work – widely disliked, but probably good for us anyway."  

Deming and his colleagues used a unique Norwegian dataset to study the value of meetings.  They collected data from administrative registers compiled by Statistics Norway.  This dataset contained information about employee careers, mobility, and wage growth from 2022-2024.  They also compiled survey data from approximately 10,000 individuals.  

The study finds that meetings do account for a substantial chunk of worker time.   Meetings most often involve planning, coordination, problem solving, and project updates.  While meetings are time consuming and come with opportunity costs, they provide critical value.  The scholars find that, 

"Meeting frequency and intensity are positively related to worker wage growth. Workers in meeting-intensive firms report greater on-the-job learning, and interactions with more senior colleagues are associated with stronger wage growth, suggesting that knowledge transmission within firms is an important mechanism."

Thus, the scholars conclude that meetings are similar to eating broccoli.  We may not enjoy them, but perhaps they are quite good for us.  Why?  They are critical sources of organizational and personal learning.  The human connection matters.  We learn when we interact with others, ask questions, listen to them, and share our ideas.  We cannot replace that source of learning with brief exchanges via technological platforms such as email, text, Slack, etc.   Therefore, perhaps we should complain less about how many meetings we must attend, and focus more on how to make them more productive.  

Overreliance on our Willpower

Getty Images

How can we break a bad habit at work or in our personal lives?  Well, we just have to muster enough willpower.  That's what many of us tell ourselves.  The old cliche is clear:  When there's a will, there's a way.  Of course, an alternative strategy exists.  We could employ commitment strategies, or put another way, some external form of assistance.  For example, we might team up with a friend who helps us be accountable for achieving certain results (such as going to the gym on a regular basis). Or, we might commit to a negative repercussion if we fall back into a bad habit (such as forcing ourselves to refrain from watching our favorite Netflix show).

New research by Ariella Kristal and Julian Zlatev suggests that many people may be relying far too much on willpower rather than employing an effective commitment strategy.  HBS Working Knowledge recently published a feature story about their research and identified three main conclusions that may explain why we rely far too heavily on willpower when we try to break a bad habit:

1. "People trust others who use willpower more than commitment strategies. "

2. "People question the integrity of those who choose commitment strategies."

3. "People worry that using a commitment strategy makes them look bad."

In short, our worries about others' perceptions and judgments cause us to rely too heavily on our own willpower when trying to break a bad habit.  We think that we are signaling virtue, but in so doing, we are choosing a far less effective strategy.  Consider that finding the next time you think that willpower alone will help you avoid unproductive patterns of behavior. 

New Apple CEO John Ternus on Confidence & Humility

Source: NBC News

Fortune's Emma Burleigh has a short feature on new Apple CEO John Ternus. This week, he takes over as chief executive at Apple, succeeding long-time leader Tim Cook. Burleigh writes,

“Always assume you’re as smart as anyone else in the room, but never assume that you know as much as they do,” Ternus told University of Pennsylvania’s engineering graduates in 2024. “With this mindset, you’ll find the confidence you need to push forward, but more importantly, the humility to ask questions and learn.”

“I’ll always be grateful that I wasn’t afraid to ask for help when I needed it,” Ternus said. “Because being around people that care that deeply, it won’t just make you want to stretch your limits and see how far you can go, but they’re also the best people to help you understand how to get there."

I love the distinction that Ternus has made here.  He's arguing that we should be confident in our abilities - our intelligence and our potential.  At the same time, he's advocating for humility.  He's arguing that we should recognize that, in any given situation, there are others who know things that we do not know.  We need to acknowledge the limits of our knowledge, be curious, and ask questions.  By seeking to uncover what others know, we can make better decisions.  In short, we should be confident in our capacity to solve problems and make good choices, but humble about the knowledge that we possess before we have begun to engage with, and learn from, others around us.   

Overcoming Success Theater at Meetings

Source: CNBC

Do you focus only on success at your team’s weekly meetings?  When Larry Culp took over at GE, the company was in big trouble.  Some thought the company could not be rescued. Yet, Culp noticed that meetings often devolved into “success theater.”  They only talked about what was going well.  Culp notes, “In the old GE, messengers got shot.  I wanted to create a market for problems.”  Larry Arduini, President and CEO of GE Healthcare explains, “Larry made airing problems not something to be feared, but a goal.  He called it ‘Embracing Red’.”  You can read more about the GE turnaround under Culp in Fortune this week. 

The description of success theater reminds me of the culture at Ford Motor Company when Alan Mulally took over two decades ago.  He too tried to make it ok to identify the projects and initiatives that were blinking red.  Famously, he noticed that “all the charts were green” in his first few months at Ford, despite billions in operating losses.  When a brave executive first presented a red chart, he applauded vigorously and then asked, “Is there anything we can do to help you?” As the culture of these meetings changed, the charts became a rainbow of green, yellow, and red. 

Success theater afflicts many companies. People use staff meetings to talk about what’s going well. By the time people finish bragging about the key performance indicators that are green, there’s very little time left to surface and discuss the problems and concerns within the organization. Therefore, I suggest that leaders not only “embrace the red” but rethink their meeting agendas as well. They need to make space for open discussion of new problems, challenges, and obstacles. Otherwise, all the talk of success crowds out any opportunity to surface concerns. Make it a regular practice to put “surfacing the reds” on the agenda for each key meeting. Then, take great care regarding how you react when people share bad news. Be curious and open-minded, and don’t punish the messenger. Ask questions, listen attentively, and don’t jump to conclusions.