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Sensing (and Monetizing) Happiness at Hitachi
Inspired by research linking happiness and productivity, Hitachi had invested in developing new "people analytics" technologies to help companies increase employee happiness. Hitachi had begun manufacturing high-tech badges that quantify a wearer's activity patterns. Data from these devices revealed an unusually high correlation between certain patterns of activity and a person's subjective sense of happiness at work. Unlike mood rings or even facial expressions, both of which were highly unreliable, Dr. Kazuo Yano--the mastermind responsible for bringing ""happiness sensors"" to market--believed he now had the ability to accurately sense happiness. When combined with other sources of data like Outlook calendars or email, Dr. Yano's team could pinpoint with scientific precision which activities, events, or even people generated the most happiness in employees at work. With a firm proof of concept in hand, Dr. Yano was ready to push the business model further. He was rolling out an app to provide personalized "happiness" recommendations to employees, and he was considering other ways to automate the model to bring it to scale. He was confident that the new technology had the power to transform employee happiness and the productivity of workforces, in Japan and beyond, if he could only find the right business model to launch such a happiness movement. -
Practicing Fairness in the Family Business Workplace
One of the main challenges facing family firms is achieving fairness between family and non-family employees in the workplace. Family and non-family employees have the potential to offer unique and distinct contributions to the firm, which makes the achievement of fairness between them messy and complicated. Hence, two interesting questions are worth exploring: Given the complex nature of the family business human capital, how can family firms achieve fairness between family and non-family employees? Why should family business decision makers and advisors promote fair practices in the family business workplace? We first introduce a fair process model as a possible solution for family businesses to achieve fairness between family and non-family employees. Then, based on several examples and studies, we show that family business owners can benefit significantly from promoting fairness in the workplace both in terms of preserving business reputation and in terms of achieving long-term family business survival and success. -
Comp Targets That Work
Most companies struggle with setting executive performance targets. From 2006 to 2014, almost all of the 1,000 largest U.S. firms completely changed their CEOs' performance metrics at least once, and almost 60% changed them multiple times. The problems with such targets are well known: They often encourage managers to sacrifice a firm's long-term health or to manipulate their numbers in order to make their bonuses. What companies need is an incentive structure that makes it easier to meet targets by creating real value than by gaming the system. New research analyzing data from more than 900 firms over 15 years suggests companies can create one by following these four principles: Use multiple metrics; increase payouts at a constant rate; reward relative performance; and include nonfinancial targets. -
GROW: Using Artificial Intelligence to Screen Human Intelligence
Over 10% of all 2017 university graduates in Japan used GROW, an artificial intelligence platform and mobile app developed by Tokyo-based people analytics startup IGS, to recruit for a job. This case puts participants in the shoes of IGS founder and CEO Masahiro Fukuhara, a first-time entrepreneur, as he considers the varied ways the "big data" he is collecting is being used--and whether some uses promised more meaningful (or less potentially misleading) impact than others. After briefly introducing IGS, Fukuhara, and GROW, the case outlines exactly how GROW works, starting with a mobile app to assess competencies and personalities of candidates and ending with artificial intelligence (machine learning) to produce high-quality recommendations to companies about whom they should hire. The case then articulates precisely how three companies--airline ANA (All-Nippon Airways), global conglomerate Mitsubishi Corporation, and advertising/media company Septeni--use GROW in very different ways to manage talent recruiting, screening, hiring, placement, and development. The case asks students to consider two questions: (1) Which of the three company's approach to using people analytics for talent acquisition and development is most appealing (or most concerning)?; and (2) Should Fukuhara turn on the most advanced part of the artificial intelligence engine, allowing GROW not just to provide recommendations to clients about whom they should hire, but also (based on performance and attribute data of previous hires) to overrule clients' specifications (or biases) about the competencies they should be targeting in their ideal hires? -
Contract Labor at Regency Hospital: Legal and HR Dynamics
This case brings to the fore different complexities of contract labor employment by principal employers (PE) in the Indian context, including sensitivities involved in handling contract workers' union. Regency Hospital (RH), a corporate Hospital chain in India, acquired Gedex Hospital (GH) in 2005, along with contract workers employed in the latter. In the year 1983, GH's management decided to employ contract workers for operating its support services like House Keeping, etc. Two years later, some contract workers of GH became members of the All Gedex Employees' Union. Apprehending industrial relations (IR) problems, GH decided to take them on its permanent rolls. Later on, more contract workers of GH formally became members of this Union, but GH did not concede their demand for permanency. These workers continued to work at GH and later at RH under different contractors; for they were well-trained hospital workforce. When RH acquired GH in 2005, some of the contract workers were doing the same work as was done by RH's core workers, and continued to work that way. In October 2015 all contract workers of RH went on strike. Their demands included increase in wages and absorbing them in RH's core workforce. RH argued that all that was the obligation of the contractor concerned through whom they were employed. RH's HR manager contacted the local police, which eventually helped in pacifying these contract workers leading to withdrawal of their agitation. In the meantime, the management enhanced some minor welfare benefits for them through the contractor, but no substantive relief was given. RH was pondering on action it should take, and how to prevent reoccurrence of similar complex situations. It was also considering the working environment that should be made available to contract workers so as to promote their engagement, and also avoiding any possible legal lapses on its part in handling contract labor issues. -
Rethinking the East Asian Leadership Gap
This is an MIT Sloan Management Review article. Many western multinationals have a tough time finding local talent in East Asia -a problem that global companies originating in East Asia don't seem to face. One problem: The cultural values and expectations of those doing the hiring and those seeking the jobs are at odds. -
A Data-Driven Approach to Identifying Future Leaders
This is an MIT Sloan Management Review article. Many executives believe they are good at identifying leadership talent. However, when asked how they make their decisions, they often cite intuition or "gut"instincts. Social science research, on the other hand, suggests that individuals are often prone to cognitive biases in such decisions. Rather than just relying on the subjective opinions of executives, some companies are using assessment tools to identify high-potential talent. -
Decoding CEO Pay*
Each year most public companies issue reports describing the pay packages of their CEOs. In them compensation committees attempt to explain the rationale behind the pay figures to the shareholders, who often must vote to approve them. The issue is, in their reports many committees adjust performance numbers in obscure and inappropriate ways that lead to overly generous CEO pay. And they do so using nonstandard criteria that are difficult for even sophisticated institutional investors to decode. In this article, the former executive chairman of MFS Investment Management and an MIT professor of accounting and finance sort through the reports' fine print and expose practices that stack the deck in CEOs' favor: Adjusting earnings to be 100% higher than GAAP income. Paying out 80% of an incentive award for bottom-quartile performance. Choosing "peer companies" that are not comparable in size or in industry. And more. Shareholders should be more skeptical, say the authors, and comp reports must start providing much clearer explanations. But what's needed most are new standards for compensation design and reporting. -
Why I Hate Feedback: Anchoring Effective Feedback within Organizations
More than ever, business practitioners perceive feedback as a vital tool for increasing sustainable business competitiveness; however, research on feedback shows mixed results in terms of its effectiveness. Three problems underlie the paradox of feedback. First, the word 'feedback' lacks definition. Both scholars and practitioners have different understandings of what feedback means. This lack of clarity hampers successful implementation of feedback as a corporate reflex. Second, feedback can be destructive. In fact, toxic feedback might disengage employees from their jobs. Third, giving and receiving feedback is more difficult than we sometimes like to think. The mantra "our organization has an open feedback culture" does not alone suffice to support effective feedback behavior. This Executive Digest addresses these issues and introduces the feedback ecosystem: a four-step process (receive, reflect, plan, act) bridging theory and practice to anchor effective feedback within organizations. In addition, evidence-based advice is offered on how to implement each step of the feedback ecosystem. -
Addressing Skills Mismatch: Utilizing Talent Supply Chain Management to Enhance Collaboration Between Companies and Talent Suppliers
Talent management continues to be a topic of interest for employers who face significant challenges dealing with the uncertainty of the supply and demand of talent in organizations. In particular, employers often speak of a talent gap that exists between the skills possessed by applicants and the skills needed in organizations. Supply chain management (SCM), a field that focuses on matching product supply with consumer demand, offers several concepts and models that could apply to and help resolve issues related to the skills mismatch. In order to address this issue, we base our conceptual development on a theoretical framework used in SCM called the collaborative, planning, forecasting, and replenishment (CPFR) approach. We use this approach to develop a comprehensive model of talent supply chain management (TSCM) that applies concepts related to the field of SCM to managing the development and flow of talent. We further go on to describe how organizations can utilize TSCM to enhance connections with talent suppliers to get their labor demands fulfilled with individuals who have the necessary skills for success. -
The New Age of Pay Transparency
A new age of pay transparency began on January 11, 2016, when Executive Order 13665 took effect. Applying to employers who have contracts valued over $10,000 with the U.S. government, the order prohibits them from retaliating against employees for disclosure and discussion of compensation information. This effectively increases pay transparency for an estimated 20% (28 million workers) of the labor force. As a result, the difference in pay between men and women and between white and minority employees is now under increased scrutiny. This article aids employers in this new era of heightened attention to their compensation practices. We begin with an overview of the current dimensions of pay gaps in the U.S., providing a societal level perspective. Pay transparency is emphasized as a means to help narrow earnings gaps at the firm level. Legal, regulatory, and social aspects of pay disclosure are discussed and employers currently using pay transparency are highlighted. We also present management responsibilities and practices for the new age of pay transparency. -
Maggie Wilderotter: The Evolution of an Executive
In a career that spanned over 30 years, Maggie Wilderotter served as CEO of two publicly traded companies and served on 32 corporate and nine association and non-profit boards of directors. As CEO of Frontier Communications, a U.S. telecom company with over $25 billion in assets, Wilderotter executed three major acquisitions, transforming the company's business mix and more than doubling its size. This case explores Wilderotter's career, examining the personal characteristics that made her such a successful executive and board member. The case also looks at the turning points in Wilderotter's career; the decisions she made and the way in which she built her skills. -
Building Your Developmental Network - Exercise A
This exercise will introduce the concept of developmental networks and overview relational strategies for advancing careers. During the session, participants will complete a developmental network exercise. This will involve creating a developmental network map of their current set of relationships, analyzing the structure and content of that network, and assessing the fit of their network with their leadership development needs. In this process, they will review the various types of networks, strategies for networking, initiating new developmental relationships, and sustaining their network. They will formulate goals and an action plan to utilize these tools going forward. The exercise is appropriate to use in the following classes: Organizational Behavior, Careers, Leadership, Human Resources, and Entrepreneurship. -
Building Your Developmental Network - Exercise B
This exercise will introduce the concept of developmental networks and overview relational strategies for advancing careers. During the session, participants will complete a developmental network exercise. This will involve creating a developmental network map of their current set of relationships, analyzing the structure and content of that network, and assessing the fit of their network with their leadership development needs. In this process, they will review the various types of networks, strategies for networking, initiating new developmental relationships, and sustaining their network. They will formulate goals and an action plan to utilize these tools going forward. The exercise is appropriate to use in the following classes: Organizational Behavior, Careers, Leadership, Human Resources, and Entrepreneurship. -
Building Your Developmental Network - Exercise C
This exercise will introduce the concept of developmental networks and overview relational strategies for advancing careers. During the session, participants will complete a developmental network exercise. This will involve creating a developmental network map of their current set of relationships, analyzing the structure and content of that network, and assessing the fit of their network with their leadership development needs. In this process, they will review the various types of networks, strategies for networking, initiating new developmental relationships, and sustaining their network. They will formulate goals and an action plan to utilize these tools going forward. The exercise is appropriate to use in the following classes: Organizational Behavior, Careers, Leadership, Human Resources, and Entrepreneurship. -
Building Your Developmental Network - Exercise D
This exercise will introduce the concept of developmental networks and overview relational strategies for advancing careers. During the session, participants will complete a developmental network exercise. This will involve creating a developmental network map of their current set of relationships, analyzing the structure and content of that network, and assessing the fit of their network with their leadership development needs. In this process, they will review the various types of networks, strategies for networking, initiating new developmental relationships, and sustaining their network. They will formulate goals and an action plan to utilize these tools going forward. The exercise is appropriate to use in the following classes: Organizational Behavior, Careers, Leadership, Human Resources, and Entrepreneurship. -
Building Your Developmental Network - Exercise E
This exercise will introduce the concept of developmental networks and overview relational strategies for advancing careers. During the session, participants will complete a developmental network exercise. This will involve creating a developmental network map of their current set of relationships, analyzing the structure and content of that network, and assessing the fit of their network with their leadership development needs. In this process, they will review the various types of networks, strategies for networking, initiating new developmental relationships, and sustaining their network. They will formulate goals and an action plan to utilize these tools going forward. The exercise is appropriate to use in the following classes: Organizational Behavior, Careers, Leadership, Human Resources, and Entrepreneurship. -
Building Your Developmental Network - Exercise F
This exercise will introduce the concept of developmental networks and overview relational strategies for advancing careers. During the session, participants will complete a developmental network exercise. This will involve creating a developmental network map of their current set of relationships, analyzing the structure and content of that network, and assessing the fit of their network with their leadership development needs. In this process, they will review the various types of networks, strategies for networking, initiating new developmental relationships, and sustaining their network. They will formulate goals and an action plan to utilize these tools going forward. The exercise is appropriate to use in the following classes: Organizational Behavior, Careers, Leadership, Human Resources, and Entrepreneurship. -
MOD Pizza in 2017
This case provides a brief update to Boris Groysberg's, John D. Vaughan's, and Matthew G. Preble's, "MOD Pizza: A Winning Recipe?" HBS No. 416004 (Boston: Harvard Business School Publishing, 2015). "MOD Pizza in 2017" describes how MOD Pizza has grown between May 2015 (when the first case ends) and early 2017. -
Money Cash Flow Inc.: HR Analytics Applied to Employee Retention and Well-Being Issues (A)
This two-part analytical case illustrates the situation of Money Cash Flow Inc., a fast-growing Canadian insurance company, where the human resources management at its Montreal call centre has gradually become a major concern. In view of the many customer complaints and the growing number of employee departures, senior management wants to correct the situation and get the company back on an even keel. A stable and committed workforce is an important factor in the company's success. Management recognizes that human capital is the main source of its value added and a strategic advantage in its industry.