March 24, 2010
October 8, 2009
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March 10, 2009
January 28, 2009
Spend a full day with the world's most influential business thinker, Gary Hamel, to learn the secrets to building a company that's truly fit for the future. In this provocative and practical workshop, Hamel will provide you with a blueprint for building the essential capabilities that will distinguish tomorrow’s most successful organizations. Hamel’s goal: to help you become an inspired management innovator, and your company to become a successful management maverick.
In a recent post I promised that I’d lay out a blueprint for building a company that’s as nimble as change itself—and I will, but first I’d like to share an anecdote about a simple experiment in workplace freedom.
In most organizations, the decision-making freedoms of frontline employees are highly circumscribed. Sales reps, call center staff, office managers, and assembly line workers are usually trussed up in tangle of top-down policies, “best practices,” and standard operating procedures. Yet it’s impossible to build a highly adaptable organization without first expanding the scope of employee freedom. To create an organization that’s adaptable and innovative, people need the freedom to challenge precedent, to “waste” time, to go outside of channels, to experiment, to take risks and to follow their passions.
To the question, “can an organization die an untimely death,” an economist would answer “no.” Institutions die when they deserve to die, that is, when they have shown themselves perpetually incapable of fulfilling stakeholder demands.
Yet this crude tautology conceals a more subtle point. Institutions are seldom murdered; usually, they commit suicide (with politicians sometimes cast in the role of Dr. Kevorkian). But just as a suicide can be untimely, so too can corporate death—at least from the perspective of society at large.
At the end of my last post I posed a couple of questions: In a dynamic economy, is there any reason to care whether a particular company lives or dies? Or to put it another way, does organizational longevity have any intrinsic value—for shareholders, employees, customers or society at large?
In two recent blogs I outlined four reasons why flourishing companies often falter: change happens, gravity wins, strategies die and success corrupts. To these let me add a fifth failure factor: catastrophes strike. Occasionally it really isn’t management’s fault—poop happens. For example, it would be unfair to blame Toyota’s management team for the entirety of the firm’s recent $21.8 billion reversal in earnings (from FY08 to FY09). Likewise, executives at Southwest Airlines deserve at least a tear of sympathy for the brass-knuckled battering their company has received in the recent recession.
By itself, an externally-generated calamity is seldom enough to kill off a successful business; though a bout of seriously bad luck can deliver the coup de grâce to a company that was already on its knees.
When you’re crawling through the long dark tunnel of a recession, it’s hard to be optimistic—even if you believe that the world is filled with more promise than peril. And if you’re a champion of innovation, I imagine the challenge is even greater. If you’re a corporate VP, you’ve probably had a pet project gutted by some recently emboldened bean counter. If you’re a struggling entrepreneur, you’ve already laid off half your staff and cut expenses to the bone, and there’s no new cash in sight. And if you’re a consultant who helps other folks to invent new stuff, you’re probably just one “spending freeze” conversation away from posting yourself at busy intersection with a hand-lettered sign: “Will innovate for food.”
London Business School, 3:30–6:30pm
In most large companies, the number of employees who are highly engaged in their work is less than 30%, and the number actively disengaged is greater than 20%. These figures are scandalous: engaged workers are the lifeblood of any creative or entrepreneurially-minded company, and most companies are simply failing to create the conditions that make people excited about coming to work.
In this Conference, experts from the worlds of academia and business practice will discuss the latest ideas about employee engagement, and some of the innovative approaches to generating engagement that they have tried. Questions to be addressed include:
In my last post I identified three things that can turn leaders into laggards: the practical difficulties of sustaining above-average performance, the natural obsolescence of once-vital strategies, and the corrosive impact of discontinuous change. Now let me add a fourth: success corrupts.
The seeds of failure are usually sown at the heights of greatness—that’s why success is so often a self-correcting phenomenon. The dynamics work like this:
I grew up in Michigan, so the bankruptcy filing of General Motors strikes close to home. There was a time when GM made more than half the cars sold in the United States. But now, what was for decades the world’s largest industrial company, is a ward of the state. GM’s failure isn’t the result of one spectacularly ill-conceived decision—the company didn’t jump off a cliff. Instead, it meandered into mediocrity, one small short-sighted step at a time. Like a two-pack a day smoker, GM committed suicide in degrees.
Dodgy quality, a toxic labor environment, incoherent brand identities, clunky power-trains, adversarial supplier relations, and subterranean resale values—these were the chronic symptoms of a management model that regarded profits as the game rather than the scoreboard, that valued financial finagling more highly than inspired engineering, and elevated MBA-types to rule over the car guys.
In the years ahead, any leader who hopes to have followers will need to carefully examine the foundations of their own authority. Why? Because we live in a world where the effectiveness of positional power is rapidly diminishing—at least outside of prisons and elementary schools.
Thanks to Enron, WorldCom, Adelphia, FEMA, Lehman Brothers, AIG, Fannie Mae, et al, the generation now joining the workforce has an extraordinarily jaundiced view of authority. They are deeply (and often rightly) suspicious of large organizations and those who run them. In their view, it’s not titles and credentials that make a leader worth following, but mission, self-sacrifice and world-class competence. Another worrying trend for centralization-minded leaders—an accelerating pace of change that penalizes organizations with lumbering top-down decision-making structures.