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Creating a Performance Culture
Engagement, enthusiasm and excellence are the hallmarks of a performance culture. Following these authors' advice will put managers on the road to creating that culture. Creating a performance culture requires a systematic approach to managing the performance of organizations, teams and individuals. While leadership and discipline are the defining elements of that approach, they are not the only elements. These authors outline a road map for changing organizational behaviour and, ultimately, for implementing, promoting and sustaining a high-performance culture. -
Law of the Emperor's Wardrobe
Some leaders intimidate; others are unapproachable. But is that really the case? Confronting a leader in the right way can lead to pleasant surprises. High-performance leaders realize that more often than not they just don't know how their people really feel about their leadership. Push-back, having the courage to question a leader and point out that his or her behaviour is counter-productive, can help a leader make a better, truly informed decision. The wise and mature leader will welcome the push-back: And it will make his or her job easier. -
Succession Planning: Often Requested, Rarely Delivered
Almost every organization needs - and has - a succession plan. But it's the quality of the plan that counts - and in too many cases, is lacking. Quick, or even ad hoc, decision making may be appropriate in certain situations, but choosing the next CEO is not one of them. Surprisingly, many organizations lack a proper succession plan. One reason is that they do not have an effective succession planning process. This author draws a detailed and comprehensive road map that every organization should use. -
Getting New Hires Up to Speed Quickly
This is an MIT Sloan Management Review article. How do managers and companies quickly transform new hires into productive employees, a process called "rapid on-boarding"? Contends that companies that are more successful at rapid on-boarding tend to use a relational approach, helping newcomers to establish rapidly a broad network of relationships with coworkers that they can tap into to obtain the information they need to become productive. Most organizations realize the importance of integrating new employees, but many fail in this regard, often because of pervasive myths about the process. Because of those misconceptions, managers frequently rely on practices that can actually hinder new employees from becoming productive. -
Entrepreneur's Path to Global Expansion
This is an MIT Sloan Management Review article. Most start-up companies today consider overseas expansion from their inception. Yet, says the author, entrepreneurs and their managers often underestimate the cost of expansion and lack a clear conceptual framework for it. On the basis of studying 50 entrepreneurial ventures in more than 20 countries, the author concludes that such ventures follow a variety of different expansion paths. The most successful are those that best manage the constant tensions between resources and opportunities, each of which run the gamut from purely local to worldwide. Offers a framework that defines the choices a venture has at its inception and throughout its life and shows how to use the framework to assess and direct a venture and mitigate developing tensions by anticipating a variety of strategic, financial, organizational, and regulatory factors. Uses case examples of a software company that took a balanced or "diagonal" path (the most common), an air-freight delivery service that progressed from pursuing local opportunities with local resources to pursuing cross-border opportunities with local resources, and a consumer-loan provider that began by pursuing a local opportunity with local resources, then added cross-border resources. -
Changing Face of Corporate Boards
This is an MIT Sloan Management Review article. Corporate boards in the United States have recently been on the hot seat. Stimulated by high-profile scandals, investor dissatisfaction with board performance and questions about the level of executive compensation, regulators have introduced significant reforms in the rules that govern boards. But will such reforms actually contribute to the effectiveness of boards? A real danger exists that the mandated changes not only will fail to enhance how companies are governed but also could possibly lead to a number of negative unintended consequences. To investigate such issues, the authors conducted a study that compared the board practices and effectiveness of Fortune 1000 companies in 1998 vs. 2003. They looked specifically at three areas: board leadership, the conditions governing board membership, and the performance evaluations of boards, individual board members, and CEOs. The results have helped to determine which practices in those three areas are actually related to overall board performance. -
Achieving the Ideal Brand Portfolio
This is an MIT Sloan Management Review article. To optimize a portfolio of brands, companies can use a step-by-step approach: decide on the brands to review; analyze each brand with respect to its contribution to the company; assess the brands according to current market performance (traction) and future prospects (momentum); and classify the brands along those three dimensions (contribution, traction, and momentum), allowing managers to identify both challenges and opportunities. The process enables companies to sort their brands into different categories: power (a brand that needs to be defended ferociously and deployed judiciously), sleeper (a brand that with a little fast tracking can build into a power brand), slider (a valuable brand that has lost momentum, is slipping backwards, and needs immediate intervention to prevent meltdown), soldier (a solid brand that contributes quietly without the need for much management attention), black hole (a brand that sucks up resources and may or may not ever pay out), rocket (a brand that is on its way to power-brand status), wallflower (a small, underappreciated brand with very loyal customers, often underpriced and undermarketed), and discard (a brand that should have been mothballed years ago). Companies can then tie together the objectives for each brand into an overall plan, which will include brand architecture and resource allocation. -
Matrixed Approach to Designing IT Governance
This is an MIT Sloan Management Review article. Uses two different studies--a survey of CIOs at 256 enterprises in the Americas, Europe, and the Asia/Pacific region and a set of 40 interview-based case studies at large companies such as Johnson & Johnson, Carlson Companies, UPS, Delta Air Lines, and ING DIRECT--to conclude that when senior managers take the time to design, implement, and communicate IT governance processes, companies get more value from IT. Toward that end, they offer a single-page framework for designing effective IT: a matrix that juxtaposes the five decision areas (principles, architecture, infrastructure, business application needs, and prioritization and investment decisions) against six archetypal approaches (business monarchy, IT monarchy, federal, duopoly, feudal, and anarchy). Illustrates how successful companies use different approaches for different decisions to maximize efficiency and value for both IT and the overall enterprise. Offers recommendations to guide effective IT governance design. -
Validity vs. Reliability: Implications for Management
As the modern economy has evolved, business has increasingly used management science and information technology in an attempt to generate reliability - predictable outcomes on a consistent basis. The author argues that despite these efforts, there is little evidence that the ability of organizations to accurately understand the world and predict the future has increased one iota. Massive spending on these systems has not prevented corporations from being ambushed by new competitors and changing markets, and the author argues that the reason for this is a natural tension between the pursuits of reliability and validity. Reliability seeks to produce consistent, predictable outcomes by utilizing a system that is restricted to the use of objective data - for instance, predicting a customer's future purchases by using data collected in their Customer Information File (CIF) in a CRM system. Considering judgmental factors such as the mood of the customer or their attitude towards new products would be seen as an abomination in a reliable system. Validity, on the other hand, seeks to produce outcomes that meet the desired objective, even if the system employed can't produce a consistent, predictable outcome. The author describes three key implications of the obsession with reliability for management and says that to succeed in the next 20 years, firms will have to figure out how to become a more welcoming place for validity-oriented systems and for people who are more comfortable handling 'fuzzy' data and using their judgment. -
The Evolution of the Design-Inspired Enterprise
Design is now understood as a core activity that confers competitive advantage by bringing to light the emotional meaning products and services have - or could have - for consumers, and by extracting high value from such emotional connections. This understanding is creating more design-focused enterprises in a wide variety of industries -- organizations that use consumer-centered product development to move quickly and effectively from intimate customer knowledge to successful product and service offerings. The authors explain how a focus on design translates into a focus on customers' true needs and unarticulated aspirations, ultimately creating better-informed, more nimble companies. They review six design strategies that can be used to bring a design focus to any organization. -
Promoting Experimentation for Organizational Learning: The Mixed Effects of Inconsistency
Innovation is a rallying cry for today's organizations. Yet encouraging both innovation and the superb execution of routine work concurrently runs the risk of sending a mixed message that can end up accomplishing neither. The author defines the concepts of 'psychological safety' and 'evaluative pressure' and their effects on employees' willingness to experiment, and shows how creating a consistent work environment containing psychological safety can reduce employees' fear of failure and promote experimentation. She presents findings that creativity is related to organizational culture, reward systems, supervisory encouragement and trust. -
New Road to the Top
By comparing the top executives of 1980's Fortune 100 companies with the top brass of firms in the 2001 list, the authors have quantified a transformation that until now has been largely anecdotal. A dramatic shift in executive careers, and in executives themselves, has occurred over the past two decades. Today's Fortune 100 executives are younger, more of them are female, and fewer were educated at elite institutions. They're also making their way to the top more quickly. They're taking fewer jobs along the way, and they increasingly move from one company to the next as their careers unfold. In their wide-ranging analysis, the authors offer a number of insights. For one thing, it has become clear that there are huge advantages to working in a growing firm. For another, the firms that have been big for a long time still provide the most extensive training and development. They also offer relatively long promotion ladders--hence the common wisdom that these "academy companies" are great to have been from. While women were disproportionately scarce among the most senior ranks of executives in 2001, those who arrived got there faster and at a younger age than their male colleagues. Perhaps the career hurdles that women face had blocked all but the most highly qualified female managers, who then proceeded to rise quickly. In the future, a record of good P&L performance may become even more critical to getting hired and advancing in the largest companies. As a result, we may see a reversal of the usual flow of talent, which has been from the academy companies to smaller firms. It may be increasingly common for executives to develop records of performance in small companies, or even as entrepreneurs, and then seek positions in large corporations. -
Best Advice I Ever Got
A young manager faces an impasse in his career. He goes to see his mentor at the company, who closes the office door, offers the young man a chair, recounts a few war stories, and serves up a few specific pointers about the problem at hand. Then, just as the young manager is getting up to leave, the elder executive adds one small kernel of avuncular wisdom--which the junior manager carries with him through the rest of his career. Such is the nature of business advice. Or is it? The six essays in this article suggest otherwise. Few of the leaders who tell their stories here got their best advice in stereotypical form, as an aphorism or a platitude. For Ogilvy & Mather chief Shelly Lazarus, profound insight came from a remark aimed at relieving the tension of the moment. For Novartis CEO Daniel Vasella, it was an apt comment made on a snowy day back when he was a medical resident. For publishing magnate Earl Graves and Starwood Hotels' Barry Sternlicht, advice they received about trust from early bosses took on ever deeper and more practical meaning as their careers progressed. For Goldman Sachs Chairman Henry Paulson, Jr., it was as much his father's example as it was a specific piece of advice his father handed down to him. And fashion designer Liz Lange rejects the very notion that there's inherent wisdom in accepting other people's advice. As these stories demonstrate, people find wisdom when they least expect to, and they never really know what piece of advice will transcend the moment, profoundly affecting how they later make decisions, evaluate people, and examine--and reexamine--their own actions. -
Almost Ready: How Leaders Move Up
Most designated CEO successors are talented, hardworking, and smart enough to go all the way--yet fail to land the top job. What they don't realize is, the qualities that helped them in their climb to the number two position aren't enough to boost them to No. 1. In addition to running their businesses well, the author explains, would-be CEOs must master the art of forming coalitions and winning support. They must also sharpen their self-awareness and their sensitivity to the needs of bosses and influential peers because they typically receive little performance feedback once they're on track to become CEO. Indeed, the ability to pick up on subtle cues is often an important part of the test. When succession doesn't go well--or fails altogether--many people pay the price. Among those at fault are boards that do not keep a close watch on the succession process, human resources organizations that should have the capacity to help but are not up to the task, and CEOs who do a poor job coaching potential successors. But the aspiring CEO also bears some responsibility. He can dramatically increase his chances of success by understanding his boss's point of view, knowing his own limitations, and managing what psychologist Gerry Egan has called the "shadow organization"--the political side of a company, characterized by unspoken relationships and alliances--without being labeled "political." Most of all, he must learn to conduct himself with a level of maturity and wisdom that signals he is ready--not almost ready--to be chief executive. -
Overloaded Circuits: Why Smart People Underperform
Frenzied executives who fidget through meetings, lose track of their appointments, and jab at the "door close" button on the elevator aren't crazy--just crazed. They suffer from a newly recognized neurological phenomenon that the author, a psychiatrist, calls attention deficit trait, or ADT. It isn't an illness; it's purely a response to the hyperkinetic environment in which we live. But it has become epidemic in today's organizations. When a manager is desperately trying to deal with more input than he possibly can, the brain and body get locked into a reverberating circuit while the brain's frontal lobes lose their sophistication, as if vinegar were added to wine. The result is black-and-white thinking; perspective and shades of gray disappear. People with ADT have difficulty staying organized, setting priorities, and managing time, and they feel a constant low level of panic and guilt. It is possible to control ADT by engineering one's environment and one's emotional and physical health. Make time every few hours for a "human moment"--a face-to-face exchange with a person you like. Get enough sleep, switch to a good diet, and get adequate exercise. Break down large tasks into smaller ones, and keep a section of your work space clear. Try keeping a portion of your day free of appointments and e-mail. The author recommends that companies invest in amenities that contribute to a positive atmosphere. -
What's Your Story?
When you're in the midst of a major career change, telling stories about your professional self can inspire others' belief in your character and in your capacity to take a leap and land on your feet. It also can help you believe in yourself. A narrative thread will give meaning to your career history; it will assure you that, in moving on to something new, you are not discarding everything you've worked so hard to accomplish. Unfortunately, the authors explain in this article, most of us fail to use the power of storytelling in pursuit of our professional goals, or we do it badly. Tales of transition are especially challenging. Not knowing how to reconcile the built-in discontinuities in our work lives, we often relay just the facts. We present ourselves as safe--and dull and unremarkable. That's not a necessary compromise. A transition story has inherent dramatic appeal. The protagonist is you, of course, and what's at stake is your career. Perhaps you've come to an event or insight that represents a point of no return. It's this kind of break with the past that will force you to discover and reveal who you really are. Discontinuity and tension are part of the experience. If these elements are missing from your career story, the tale will fall flat. With all these twists and turns, how do you demonstrate stability and earn listeners' trust? By emphasizing continuity and causality--in other words, by showing that your past is related to the present and, from that trajectory, conveying that a solid future is in sight. If you can make your story of transition cohere, you will have gone far in convincing the listener--and reassuring yourself--that the change makes sense for you and is likely to bring success. -
How to Play to Your Strengths
Most feedback accentuates the negative. During formal employee evaluations, discussions invariably focus on "opportunities for improvement," even if the overall evaluation is laudatory. No wonder most executives--and their direct reports--dread them. Traditional, corrective feedback has its place, of course; every organization must filter out failing employees and ensure that everyone performs at an expected level of competence. But too much emphasis on problem areas prevents companies from reaping the best from their people. After all, it's a rare baseball player who is equally good at every position. Why should a natural third baseman labor to develop his skills as a right fielder? This article presents a tool to help you understand and leverage your strengths. Called the Reflected Best Self (RBS) exercise, it offers a unique feedback experience that counterbalances negative input. It allows you to tap into talents you may or may not be aware of and, so, increase your career potential. To begin the RBS exercise, you first need to solicit comments from family, friends, colleagues, and teachers, asking them to give specific examples of times in which those strengths were particularly beneficial. Next, you need to search for common themes in the feedback, organizing them in a table to develop a clear picture of your strong suits. Third, you must write a self-portrait--a description of yourself that summarizes and distills the accumulated information. And, finally, you need to redesign your personal job description to build on what you're good at. The RBS exercise helps you discover who you are at the top of your game. Once you're aware of your best self, you can shape the positions you choose to play--both now and in the next phase of your career. -
Do Your Commitments Match Your Convictions?
How many of us keep pace day to day, upholding our obligations to our bosses, families, and the community, even as our overall satisfaction with work and quality of life decline? And, yet, our common response to the situation is: "I'm too busy to do anything about it now." Unfortunately, unless a personal or professional crisis strikes, very few of us step back, take stock of our day-to-day actions, and make a change. In this article, London Business School strategy professors Donald Sull and Dominic Houlder examine the reasons why a gap often exists between the things we value most and the ways we actually spend our time, money, and attention. They also suggest a practical approach to managing the gap. The framework they propose is based on their study of organizational commitments--the investments, promises, and contracts made today that bind companies to a future course of action. Such commitments can prevent organizations from responding effectively to change. A similar logic applies to personal commitments--the day-to-day decisions we make about how we allocate our precious resources. These decisions are individually small and, therefore, easy to lose sight of. When we do, a gap can develop between our commitments and our convictions. Sull and Houlder make no value judgments about the content of personal commitments; they've devised a somewhat dispassionate tool to help you take a thorough inventory of what matters to you most. It involves listing your most important values and assigning to each a percentage of your annual salary, the hours out of your week, and the amount of energy you devote. Using this exercise, you should be able to identify big gaps--stated values that receive little or none of your scarce resources or a single value that sucks a disproportionate share of resources--and change your allocations accordingly. -
Managing Your Boss
In this classic HBR article, first published in 1980, John J. Gabarro and John P. Kotter advise readers to devote time and energy to managing their relationships with their bosses. The authors aren't talking about showering supervisors with flattery; rather, they ask readers to understand that the manager-boss relationship is one of mutual dependence. Bosses need cooperation, reliability, and honesty from their direct reports. Managers, for their part, rely on bosses for making connections with the rest of the company, for setting priorities, and for obtaining critical resources. It only makes sense to work at making the relationship operate as smoothly as possible. Successfully managing your relationship with your boss requires that you have a good understanding of your supervisor and of yourself, particularly strengths, weaknesses, work styles, and needs. Once you are aware of what impedes or facilitates communication with your boss, you can take actions to improve your relationship. You can usually establish a way of working together that fits both of you, is characterized by unambiguous mutual expectations, and makes both of you more productive and effective. No doubt, some managers will resent that on top of all their other duties, they must also take responsibility for their relationships with their bosses. But these managers fail to realize that by doing so, they can actually simplify their jobs, eliminating potentially severe problems and improving productivity. -
Managing Oneself
Throughout history, people had little need to manage their careers-they were born into their stations in life or, in the recent past, they relied on their companies to chart their career paths. But times have drastically changed. Today we must all learn to manage ourselves. What does that mean? As Peter Drucker tells us in this seminal article first published in 1999, it means we have to learn to develop ourselves. We have to place ourselves where we can make the greatest contribution to our organizations and communities. And we have to stay mentally alert and engaged during a 50-year working life, which means knowing how and when to change the work we do. It may seem obvious that people achieve results by doing what they are good at and by working in ways that fit their abilities. But, Drucker says, very few people actually know-let alone take advantage of-their fundamental strengths. He challenges each of us to ask ourselves: What are my strengths? How do I perform? What are my values? Where do I belong? What should my contribution be? Don't try to change yourself, Drucker cautions. Instead, concentrate on improving the skills you have and accepting assignments that are tailored to your individual way of working. If you do that, you can transform yourself from an ordinary worker into an outstanding performer. Today's successful careers are not planned out in advance. They develop when people are prepared for opportunities because they have asked themselves those questions and have rigorously assessed their unique characteristics. This article challenges readers to take responsibility for managing their futures, both in and out of the office.