After failing to make the basketball, baseball, and football teams in high school, the author persuaded the administration to start a lacrosse team, figuring that no one would know any more than he did about how to play. Eventually he got good at the game and became team captain. He took a valuable lesson from that experience: Opportunity is something you manufacture, not something you wait for. That lesson has informed his career ever since. For example, while he had a part-time job moving boxes as part of a relocation for Little, Brown, he happened across an assignment to create a book jacket. Familiarity with Photoshop and Quark enabled him to quickly come up with a design and slip it into the pile of submissions. When the editors and the sales team chose it as the best, he was offered a full-time job. A couple of start-ups and a stint at Google later, Stone and a close friend came up with the idea for Twitter. His job at the company was to "bring humanity to the technology" and to help "shape our story for the outside world." (He drew the bird logo.) His latest venture is Jelly Industries, a seven-person company of which he's the CEO. There he has learned that the chief executive's most important job is to constantly communicate.
Why is it so hard to build and maintain the capacity to innovate? The reason is not simply a failure to execute but a failure to articulate an innovation strategy that aligns innovation efforts with the overall business strategy. Without such a strategy, companies will have a hard time weighing the trade-offs of various practices-such as crowdsourcing and customer co-creation-and so may end up with a grab bag of approaches. They will have trouble designing a coherent innovation system that fits their competitive needs over time and may be tempted to ape someone else's system. And they will find it difficult to align different parts of the organization with shared priorities. As Corning, a leader in glass and materials science, has found, an innovation strategy must address how innovation will create value for potential customers, how the company will capture a share of that value, and what types of innovation to pursue. Critics tend to discount "routine" innovation that leverages a company's existing technical capabilities and business model and extol "disruptive" innovation, but that is a simplistic view. A company's unique competitive circumstances should dictate the innovation portfolio it pursues. Because innovation cuts across functions, only senior leaders can set an innovation strategy. In doing so, they must recognize that the strategy, like the process of innovation itself, requires continual experimentation and adaptation. HBR Reprint R1506B
People in all walks of life are rightly concerned about advancing automation: Unless we find as many tasks to give humans as we find to take away from them, all the social and psychological ills of joblessness will grow, from economic recession to youth unemployment to individual crises of identity. What if, the authors ask, we were to reframe the situation? What if we were to uncover new feats that people might achieve if they had better thinking machines to assist them? We could reframe the threat of automation as an opportunity for augmentation. They have been examining cases in which knowledge workers collaborate with machines to do things that neither could do well on their own--and they've found that smart people will be able to take five approaches to making their peace with smart machines. Some will "step up" to even higher levels of cognition, where machines can't follow. Some will "step aside," drawing on forms of intelligence that machines lack. Some will "step in," to monitor and adjust computers' decision making. Some will "step narrowly" into very specialized realms of expertise. And, inevitably, some will "step forward," by creating next-generation machines and finding new ways for them to augment the human strengths of workers.
Today's digital innovations are doing for brainpower what the steam engine, and related, technologies did for muscle power during the Industrial Revolution. They're allowing us to rapidly overcome limitations and open up new frontiers, say Erik Brynjolfsson and Andrew McAfee, who have studied the impact of technologies on economies for years. The two MIT professors believe this transformation will create abundance. But they warn that there may be a dark side: Though the pie will get bigger, not everyone will benefit equally. As computers get more powerful, companies have less need for some kinds of workers. That shift is contributing to a phenomenon the two academics call the Great Decoupling: For decades, per capita GDP, productivity, private employment, and median family income rose in almost perfect lockstep. But in the 1980s, growth in income began to sputter and then began to drop. Adjusting for inflation, the median U.S. household today earns less than the median in 1998 did. Job growth has also slowed. Similar trends are emerging in most developed countries. In this interview, Brynjolfsson and McAfee explore the implications: who will win (workers with tech and creative skills), who will lose (the middle class), and how business should respond to the coming tech surge (develop ways to race with machines, not against them).
Wouldn't it be great if there were an algorithm that could tell you when to develop a new business model or enter an emerging market? Unfortunately, one doesn't exist. However, it is possible to use the principles behind algorithms to continually retune your strategy and your organization. In online enterprises, algorithms constantly readjust the products and content shown to customers. They do this by operating three learning loops: experimentation, modulation, and shaping. Algorithms keep generating new options and testing reactions to them. But over time the algorithms modulate the rate of experimentation, scaling it back as they learn more about people's likes and dislikes. Algorithms shape preferences too, by introducing customers to products they might not have otherwise discovered. Critically, they do this all in a self-directed manner, without any human intervention. Now some internet companies have begun to regularly readjust their business models, allocation processes, and structures using the same self-directed learning loops. This approach works especially well in rapidly changing markets, like China. In this article, the authors look at how China's Alibaba grew from an 18-person start-up to an $8 billion empire by regularly resetting its vision, testing out new models, shaping opportunities, and building adaptive structures.
As machines evolve from tools to teammates, the author writes, accepting them will be more than a matter of simply adopting some new technology. The first challenge will be recognizing when computers know more than we do. "Algorithm avoidance," for instance, makes people prefer human judgment over that of machines and can lead to worse decisions, from diagnosing patients to predicting political outcomes. The message for managers is that helping humans to trust thinking machines will be essential. One way to encourage that trust is to make robots more humanoid. Researchers at Carnegie Mellon explored this idea with an autonomous robot named Snackbot, which had wheels, arms, a male voice, and an LED mouth that could smile and frown. People in the office made conversation with it and treated it with kindness. But this approach may lead us to put too much faith in the machines' abilities. How we work with thinking machines will vary according to the work we're doing, how it's framed, and how the machines are designed. But under the right conditions, people are surprisingly open to a robotic colleague.
Companies may want to shift a brand's position--to exploit less crowded territory, for example, or grow sales. Companies have long used perceptual mapping to understand how consumers feel about their brands relative to competitors', to find gaps in the marketplace, and to develop brand positions. But the business value of these maps is limited because they fail to link a brand's market position to business performance metrics such as pricing and sales. Other marketing tools measure brands on yardsticks such as market share, growth rate, and profitability but fail to take consumer perceptions into consideration. In this article, Ivey Business School's Niraj Dawar and Charan K. Bagga present a new type of map that links a brand's position to competitors according to its perceived "centrality" (how representative it is of the company) and "distinctiveness" (how much it stands out from other brands) with its business performance along a given metric. Using the tool, marketers can determine a brand's current and desired position, predict its marketplace performance, and devise and track marketing strategy and execution. In-depth examples of the car and beer markets demonstrate the value of this tool to managers of brands in any category.
Fifty years ago fashion and luxury goods were all about family businesses and entrepreneurial designers. Today most of the best-known brands belong to a diversified group like LVMH, Richemont, or Kering. The success of such groups contradicts the management notion that a focus on one core leads to superior returns--and that diversification adds little value. An analysis of the performance of 350 fashion houses suggests that group affiliation does add value, say INSEAD's Andrew Shipilov and Frederic Godart. They found that the fashion collections of group brands were more successful, and judged more creative by industry buyers, than those of independent brands over a 10-year period. How do luxury groups get this edge? Through the way they groom their designers and managers. The groups exploit the variety of their businesses by setting up internal talent markets that offer rich learning opportunities. Rising stars are thus less tempted to leave the organization, and cross-group job moves help spread knowledge and best practices. Group watchmaking companies, for instance, have been able to boost their sales by hiring experts in marketing and CRM from their groups' fashion and cosmetics firms. Worldwide operations give groups another advantage, because spending time overseas is critical to executive development. This is especially true in the luxury field, where international experience exposes designers to creative influences and executives to new but fast-growing customer segments. However, it isn't just in their approach to internal talent that groups excel. They prime the entry-level pipeline by sponsoring educational programs and offering apprenticeships to promising students, as well as recruit external functional know-how more effectively than the independent brands do.
Many people today regard their computers, tablets, and smartphones as indispensable, both professionally and personally. But they can also be dangerous: Research shows that spending too much time on e-mail and social media reduces your productivity and engagement at home and at work. So how can you avoid digital overload? In this article, two experts offer dramatically different strategies. Larry Rosen, a psychologist, advocates pulling away from technology in order to refocus. His advice: Limit the time you spend with your devices, using behavioral techniques to gradually wean yourself away; when you are using technology, take periodic breaks to exercise, meditate, or otherwise recharge; and avoid on-screen activities before bedtime to ensure that you get proper rest. Alexandra Samuel, a pioneer in electronic engagement, recommends the opposite tack: Embrace technology and make smarter use of digital tools to manage information overload. She suggests filtering your e-mail and using a newsreader app to customize the stream of articles and blog items you receive. You can also automate your postings to social networks. The author's approaches needn't be mutually exclusive. Indeed, combining them may be the best way to combat digital distraction.
Global consumption of petroleum products stood at just more than 90 million barrels per day by the end of 2013, and was expected to increase to 91 million or more by the end of 2014. Petroleum companies were constantly exploring the planet for new oil reserves to meet this voracious demand for fossil fuels. Because three-quarters of the earth was water, it was evident that these oil reserves were largely underwater; however, until the end of 2013, very few players had explored this opportunity. Although reaching deep-water drilling sites posed various challenges — environmental, political, technological, etc. — offshore exploration was the future of the oil and gas industry.<br><br>Because of its very successful campaigns, Cairn India was ideally positioned for offshore exploration. Capturing and capitalizing on the opportunity of offshore exploration would give it an edge, but the question remained: Would it be better to gain the prime mover advantage or wait for other players to start the process so that it could learn from others’ mistakes and reap benefits later?
After several years of near steady state, the market share of Colgate Palmolive Canada Inc. in the toothpaste category has gathered momentum in 2012. In a bid to extend the gap between the company and its primary competitors in the category in 2013, the vice-president of customer development is discussing the options with his team at company headquarters in Toronto. Market share is an important performance metric at the company. One suggestion is to increase the marketing budget. There is a general consensus that marketing dollars should not be diffused across activities during the year, but there are differences of opinion about what to focus on — trade promotions, consumer promotions or advertising — in order to sustain the momentum in market share in 2013.
This case, an update on "Henkel: Building a Winning Culture (A)," describes Henkel's strong performance against its tough 2012 objectives, as well as the new objectives CEO Kasper Rorsted set for 2016.
When researchers asked carpenters, roofers, and in-line skaters how to improve safety gear for all three activities, each group turned out to be significantly better at thinking of novel solutions for the fields other than its own. Studies like this one demonstrate the value of accessing expertise from "analogous fields"--areas that seem different on the surface but are similar on a deep structural level. This piece shows how to find the far-flung experts who can jump-start your search for breakthrough ideas. This reprint contains two additional Idea Watch articles. "Global Growth, Paltry Returns" describes new research showing that many international expansions fail to deliver consistent and sizable profits and that companies are often better off growing locally. "When to Forget the Rearview Mirror" examines a study of forecasts in the music business, showing that in creative, volatile fields, historical data often impairs people's ability to interpret contextual data and make sound predictions.
Though the Apple logo is ubiquitous, 99 out of 100 people can't draw it from memory. The reason? Our brains don't burden us with information we don't think we'll need.
In 2015, LinkedIn, the world's largest professional network, was experiencing explosive growth, and it needed to hire the very best people quickly to support and fuel that growth. This case discusses LinkedIn's hiring approach and details how the company used its own online recruiting products, such as LinkedIn Talent Solutions, to attract and retain talent. At the same time, the company was creating new recruiting models that put it at the forefront of modern recruiting. LinkedIn had done well so far in bringing in top talent. Nevertheless, as it rapidly scaled, the challenge was making sure the company could compete with other tech firms to attract enough highly skilled engineers. The case explains specific techniques that LinkedIn's recruiting team of over 100 people used to attract talented candidates for positions in engineering, sales, and other departments. Those techniques included: 1) replacing cold calling potential candidates with finding "warm connections" to them through their LinkedIn networks; 2) using a data-driven approach to identify the best candidates to pursue; and 3) developing personalized online relationships with top candidates. LinkedIn made internal hiring a priority. For external hires, the company focused heavily on recruiting passive candidates-people were who already gainfully employed and not necessarily looking for a new job. The case also discusses LinkedIn's employee value proposition, focusing on the extraordinary opportunities employees were given for "transformation" once they joined the LinkedIn team. These opportunities included personal advancement through a smooth path to change jobs within LinkedIn if they wished, as well as formal and informal programs designed for employees to pursue their passions-and share their experiences. "LinkedIn and Modern Recruiting (B)" goes into more detail about LinkedIn's data-driven approach, new recruitment innovations, and diversity scorecard.
This case picks up where "LinkedIn and Modern Recruiting (A)" left off, detailing the company's innovations in hiring practices, which included its highly effective use of LinkedIn profile and resume data. As part of these innovations, LinkedIn's talent acquisition team built a new recruiting model, called the Total Addressable Market (TAM) model. TAM took a page out of sales and marketing models by using data that users provided on LinkedIn, enabling the company to narrow, segment, and prioritize which potential candidates to commit recruiting resources toward. In addition, the case presents LinkedIn's diversity scorecard and efforts to date.
This 2015 case focuses on the evolution of Box's management practices as the company grew from a small start-up to an organization with over 1,000 employees in five major locations. The online file sharing and cloud content collaboration service company was founded in 2005, and a decade later it was valued at $2.4 billion. During that time, Box was evolving its approaches to and processes for hiring, compensation, promotions, and performance evaluations. A driving factor in its management practices was the need to attract and retain top-quality entrepreneurial employees. However, as the company pivoted strategy to focus more on the lucrative enterprise market, its management practices had to evolve to be able to attract and retain more experienced employees with specific expertise in that segment. Box found it need to address tensions that arose as the company grew, including the slower speed of promotions, the changing compensation mix (cash versus equity), and the changing company culture as more seasoned employees joined the Box team.