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Southwest Airlines Flight 1248 (C)
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Decision Downloading
This is an MIT Sloan Management Review article. Organizations often try to include as many people as possible in the decision-making process, but sometimes it's just not possible to involve anyone beyond a small group. The need for confidentiality and speed are constraints, as is the sheer difficulty of polling an entire organization regarding decisions that will affect an entire company. Managers or executives must sometimes "download" a decision to their people after the fact--and this is where many a decision crashes on rocky shoals. Mergers fail as key employees leave and others resist change; union contracts are rejected after months of negotiation; and changes in employee benefits meet with strident protest. What's behind these failures, and what can be done to avert them? The authors lay out reasons for ineffective downloading: a disconnect between the two sides as the negotiating parties fails to see the negatives of a decision; a failure to clarify responsibilities, which results in rumor and word-of-mouth being the primary channels of communication; a desire to inform people quickly--which often means superficially; and a paternalistic desire to protect members of an organization when people would prefer to just hear the truth. Against this record of mistakes and misguided notions, the authors set their four-stage process for robust decision downloading. Their process is informed by survey research of several hundred employees in a variety of organizations, as well as interviews with dozens of executives. -
CEO Who Couldn't Keep His Foot out of His Mouth (HBR Case Study and Commentary)
In the four years since Rob Miranda became CEO of Growing Places, a provider of on-site child care for companies in the Midwestern United States, he has been a font of ideas. For instance, he set up rooms where moms can breastfeed their babies during breaks in the workday and put Webcams in classrooms so that parents can "visit" their children from their desks. As a result of Rob's entrepreneurial vision and operational savvy, the company has achieved profitable growth. The problem is that Rob tends to stick his foot in his mouth. Evan Breyer, the company's founder and chairman, hopes that Rob will learn to avoid making verbal gaffes; he even gets Rob to see a coach. But while Evan is wrapping up a facility tour for a potential corporate sponsor of a scholarship program, Rob makes an insensitive remark about breastfeeding in front of the visitors--among them, a reporter. Not surprisingly, the local paper runs a scathing editorial the next day. Several days later, during a conference presentation on preschool curricula, he does it again with a comment implying that teachers are lazy and unprepared. The result is more bad press and a meaningful dip in stock price. It's beginning to look as though Rob is not going to change, and many board members are talking ouster. Should Evan try to persuade the board to hang on to Rob? Commenting on this fictional case study in R0612A and R0612Z are Ronald A. Heifetz, a professor at Harvard's Kennedy School of Government; John H. Biggs, the former CEO of TIAA-CREF; Torie Clarke, a CNN analyst; and Roger Brown, a cofounder of Bright Horizons. -
Extreme Jobs: The Dangerous Allure of the 70-Hour Workweek
Today's overachieving professionals labor longer, take on more responsibility, and earn more than the workaholics of yore. They hold what Hewlett and Luce call "extreme jobs," which entail workweeks of 60 or more hours and have at least five of ten characteristics--such as tight deadlines and lots of travel--culled from the authors' research on this work model. A project of the Hidden Brain Drain Task Force, a private-sector initiative, this research consists of two large surveys (one of high earners across various professions in the United States and the other of high-earning managers in large multinational corporations) that map the shape and scope of such jobs, as well as focus groups and in-depth interviews that get at extreme workers' attitudes and motivations. In this article, Hewlett and Luce consider their data in relation to increasing competitive pressures, vastly improved communication technology, cultural shifts, and other sweeping changes that have made high-stakes employment more prominent. What emerges is a complex picture of the all-consuming career--rewarding in many ways, but not without danger to individuals and to society. By and large, extreme professionals don't feel exploited; they feel exalted. A strong majority of them in the United States--66%--say they love their jobs, and in the global companies survey, this figure rises to 76%. The authors' research suggests, however, that women are at a disadvantage. Although they don't shirk the pressure or responsibility of extreme work, they are not matching the hours logged by their male colleagues. This constitutes a barrier for ambitious women, but it also means that employers face a real opportunity: They can find better ways to tap the talents of women who will commit to hard work and responsibility but cannot put in overlong days. -
Leadership Under Fire
Dov Frohman was the head of Intel Israel at the start of the First Gulf War, and it fell to him to determine how the company would respond. In this first-person account, he describes what it's like to hold not just the future of a company but the future of an entire industry and the lives of many employees in his hands. Israeli businesses were used to preparing for war, or so Frohman thought when he assigned a task force to draw up plans in the fall of 1990 to replace enough called-up reservists to operate the Jerusalem fabrication plant, the Haifa design center, and the Tel Aviv sales and marketing office on skeleton crews. But that was before Saddam Hussein stationed ballistic missiles just seven minutes away from Tel Aviv. Concerned about chemical attacks, the Israeli civil defense agency called for all nonessential Israeli businesses to shut down when the allied attacks against Iraq began on January 17, 1991. The first missiles hit Jerusalem in the small hours of the next day. Instead of being behind the war zone, Intel Israel was going to be right in it. Frohman called in his task force and drove the 20 minutes to work that morning. It would have been easy to follow the civil defense directive and close down. Everyone was doing it; Intel's senior executives in California would have understood. But Frohman chose to ignore the directive and asked his employees to continue coming to work to keep operations running. This is the story of how and why the Intel senior executive made that decision, how he carried it out, and what the consequences were. It is a lesson about decision making when the stakes couldn't be higher. -
Lift Outs: How to Acquire a High-Functioning Team
More and more, expanding companies are hiring high-functioning groups of people who have been working together effectively within one company and can rapidly come up to speed in a new environment. These lifted-out teams don't need to get acquainted with one another or to establish shared values, mutual accountability, or group norms; their long-standing relationships and trust help them make an impact very quickly. Of course, the process is not without risks: A failed lift out can lead to loss of money, opportunity, credibility, and even native talent. Boris Groysberg and Robin Abrahams studied more than 40 high-profile moves and interviewed team leaders in multiple industries and countries to examine the risks and opportunities that lift outs present. They concluded that, regardless of industry, nationality, or size of the team, a successful lift out unfolds over four consecutive, interdependent stages that must be meticulously managed. In the courtship stage, the hiring company and the leader of the targeted team determine whether the proposed move is, in fact, a good idea, and then define their business goals and discuss strategies. At the same time, the team leader discusses the potential move with the other members of his or her group to assess their level of interest and prepare them for the change. The second stage involves the integration of the team leader with the new company's top leadership. This part of the process ensures the team's access to senior executives--the most important factor in a lift out's success. Operational integration is the focus of the third stage. Ideally, teams will start out working with the same or similar clients, vendors, and industry standards. The fourth stage entails full cultural integration. To succeed, the lifted-out team members must be willing to re-earn credibility by proving their value and winning their new colleagues' trust. -
CEO Who Couldn't Keep His Foot out of His Mouth (HBR Case Study)
In the four years since Rob Miranda became CEO of Growing Places, a provider of on-site child care for companies in the Midwestern United States, he has been a font of ideas. For instance, he set up rooms where moms can breastfeed their babies during breaks in the workday and put Webcams in classrooms so that parents can "visit" their children from their desks. As a result of Rob's entrepreneurial vision and operational savvy, the company has achieved profitable growth. The problem is that Rob tends to stick his foot in his mouth. Evan Breyer, the company's founder and chairman, hopes that Rob will learn to avoid making verbal gaffes; he even gets Rob to see a coach. But while Evan is wrapping up a facility tour for a potential corporate sponsor of a scholarship program, Rob makes an insensitive remark about breastfeeding in front of the visitors--among them, a reporter. Not surprisingly, the local paper runs a scathing editorial the next day. Several days later, during a conference presentation on preschool curricula, he does it again with a comment implying that teachers are lazy and unprepared. The result is more bad press and a meaningful dip in stock price. It's beginning to look as though Rob is not going to change, and many board members are talking ouster. Should Evan try to persuade the board to hang on to Rob? Commenting on this fictional case study in R0612A and R0612Z are Ronald A. Heifetz, a professor at Harvard's Kennedy School of Government; John H. Biggs, the former CEO of TIAA-CREF; Torie Clarke, a CNN analyst; and Roger Brown, a cofounder of Bright Horizons. -
CEO Who Couldn't Keep His Foot out of His Mouth (Commentary for HBR Case Study)
In the four years since Rob Miranda became CEO of Growing Places, a provider of on-site child care for companies in the Midwestern United States, he has been a font of ideas. For instance, he set up rooms where moms can breastfeed their babies during breaks in the workday and put Webcams in classrooms so that parents can "visit" their children from their desks. As a result of Rob's entrepreneurial vision and operational savvy, the company has achieved profitable growth. The problem is that Rob tends to stick his foot in his mouth. Evan Breyer, the company's founder and chairman, hopes that Rob will learn to avoid making verbal gaffes; he even gets Rob to see a coach. But while Evan is wrapping up a facility tour for a potential corporate sponsor of a scholarship program, Rob makes an insensitive remark about breastfeeding in front of the visitors--among them, a reporter. Not surprisingly, the local paper runs a scathing editorial the next day. Several days later, during a conference presentation on preschool curricula, he does it again with a comment implying that teachers are lazy and unprepared. The result is more bad press and a meaningful dip in stock price. It's beginning to look as though Rob is not going to change, and many board members are talking ouster. Should Evan try to persuade the board to hang on to Rob? Commenting on this fictional case study in R0612A and R0612Z are Ronald A. Heifetz, a professor at Harvard's Kennedy School of Government; John H. Biggs, the former CEO of TIAA-CREF; Torie Clarke, a CNN analyst; and Roger Brown, a cofounder of Bright Horizons. -
Curse of Knowledge
Impenetrable strategy statements can't unite employees behind an organization's goals, but concrete language and stories can. -
How Many Women Do Boards Need?
To reap the value of women's contributions, a board needs at least three female directors. -
Shut Up and Stop Whining
Larry Winget, "The Pit Bull of Personal Development," uses irritation rather than motivation to get managers on the road to improvement. -
What's Your Return on Knowledge?
Measuring the value of your knowledge-management program probably depends less on hard numbers than on soft indicators like anecdotes and employee surveys. -
Li Ka-Shing and the Growth of Cheung Kong
Events in the history of Cheung Kong's growth reveal how Li Ka-Shing applied his skills as a "first-class noticer" to complex political and socioeconomic environments. While Li's determination to succeed is legendary, so are his skills in reading and responding to the policies and norms of the People's Republic of China, British colonial Hong Kong, and the post-World War II international system. Since Li became the taipan of Hutchison Whampoa in the late 1970s, he has adjusted his ownership shares in a vast portfolio of businesses-including ports, energy, real estate, retail, telecommunications, and new media. Illustrates how Li applied his business acumen and his ability as a first-class noticer to decisions about raising or lowering his stake in these businesses, and whether to acquire new ones. After starting Cheung Kong Inc. in 1950, at age 21, Li built upon his knowledge and contacts in the plastics industry to become Hong Kong's King of Plastic Flowers. In the 1960s, amid political turmoil and labor unrest on both the mainland and in colonial Hong Kong, Li purchased rights to properties on Hong Kong island that were selling at distressed rates. Li's successes in industry and real estate continued, and he cultivated contacts and built a strong reputation that set the stage for his purchase of the hong Hutchinson Whampoa, thereby becoming the first Chinese taipan. As taipan, Li reorganized and reallocated his various financial holdings in the 1980s and 1990s as conditions were in flux due to the Westernization of China after Deng Xiaoping succeeded Mao Zedong, and amid concerns about the transfer of Hong Kong from Britain back to China in 1997. -
Role of Personal Relationships in Inter-Firm Alliances: Benefits, Dysfunctions, and Some Suggestions.
Strategic alliances have become an important means for developing and improving a firm's level of competitiveness. Although attractive, alliances are risky and difficult to manage. One crucial mechanism in managing and reducing alliance risk is reliance on personal relationships between managers in partnering firms. Personal ties are beneficial in that they can form the basis for developing trust between partners and aid joint decision-making and information sharing, thereby reducing some of the risks inherent in alliances. Despite their usefulness, however, personal relationships may have drawbacks. For example, strong interpersonal ties in alliances can sometimes prevent dissolution of faltering arrangements, as feelings may prevent the making of difficult, yet prudent, termination decisions. In order to combat this possibility, firms can reduce the downside of personal relationships by carefully managing the role of performance managers across the life of the relationship. -
Developing Leaders
Provides an overview of leadership development for the manager charged with developing a single individual or corporate leadership program. Introduces a framework for understanding the components of developmental experiences and then applies it to a range of experiences, including: formal and informal feedback, training, job assignments, and mentoring. Concludes with a discussion of the leadership development process--in particular, the need to factor in organizational context and individual differences when selecting and sequencing developmental experiences. -
Pine Street Initiative at Goldman Sachs
Almost five years had passed since Goldman Sachs launched its innovative leadership development initiative called Pine Street. Focused primarily on developing Goldman's most senior managers, Pine Street had evolved significantly since its inception in November of 1999. Looking forward, there were a number of challenges. How would Pine Street remain valued in a culture where what you did yesterday doesn't matter much? The question every day is "What will you do for me today?" Early in May 2005, members of the Pine Street Board of Directors gathered for their quarterly meeting to address the dimensions of this challenge: First, its curriculum had to maintain the interest of an increasingly demanding internal clientele. Second, program content had to keep pace with the constantly changing requirements of a rapidly shifting competitive and regulator landscape. Third, Pine Street itself had to pursue creative ways of renewing its structure and people without compromising either its mission or its unique culture. Fourth, Pine Street had to retain the continued support of Goldman Sachs' senior leadership. Finally, as program offerings grew, so did fundamental questions of identity: After five years of evolutionary growth, what did the Pine Street brand mean to Goldman Sachs? -
Liz Claiborne and the New Working Woman
At age 47, with two decades of experience as a lead designer for a Fortune 500 fashion company, Liz Claiborne put her life savings on the line to form Liz Claiborne, Inc., a partnership that included her husband. A decade later, in 1986, Claiborne was CEO of her own Fortune 500 company, reaching that milestone faster than any other business up to that point in history. Because the company did not own any of the factories that made its clothing, Claiborne relied upon her detailed understanding of design and manufacturing processes to instruct successfully her American and offshore contractors on how to mass-produce designer clothing at affordable prices. Claiborne was an industry pioneer in many ways. She developed detailed customer feedback collection systems. She and her staff were in frequent contact with department stores to help them present her clothing in display and to customers. In the 1980s, after building up her designer brand name, Claiborne expanded her business through licensing arrangements with quality manufacturers of apparel, shoes, and accessories. -
Too Hot to Handle? How to ManageRelationship Conflict
Conventional wisdom, together with the weight of published management advice, recommends that management teams engage task conflict directly but avoid relationship conflict. Implicit in this advice is the premise that it is indeed possible to separate the task and the relationship aspects of a business conflict. Argues that this separation is not always possible for management teams. When teams discuss "hot topics," substantive disagreements (task conflicts) tend to trigger negative attributions about others' motives or abilities (a key element of relationship conflicts). When this happens, most managers suppress their true thoughts, thus avoiding genuine discussion. Yet, when interpersonal attributions are suppressed, they tend to leak into the business conversation anyway, such as in the form of implied accusations or aggravated tones of voice. These dynamics are virtually inevitable, even when managers try hard to avoid them. Making a distinction between "hot" and "cool" topics can help clarify when avoiding discussion of relationship conflict in management teams is feasible and when it's not. In addition, management teams facing hot topics need to learn to handle relationship conflicts productively, despite the heightened emotions and interpersonal tensions associated with them. -
Cost of Knowledge
Future investments in knowledge management should focus less on enhancing systems that track down information and more on helping employees use what they've found. -
Hewlett-Packard Co.: The War Within
In September 2006 it was revealed that the Hewlett-Packard Company (HP) had been carrying out an extended investigation of its own employees, board members, and journalists outside the company. The investigation was launched in response to a series of leaks to the press that could only have come from highly placed members of the company. Fully understanding the context of the events of September, however, requires knowledge of board personalities and events that began under former CEO Carly Fiorina and continued thought the successful turnaround under her successor, Mark Hurd. As such, special focus is given to the individual board personalities and their conflicts over this time in order to fully explore the environment in which the investigation would later take place.