The Leader's Guide to Radical Management

Women are the future: The Economist conference on disruptive innovation

When women are 60% of talent and 90% of the customers, it's not diversity: it's the future.

At the conference in mid-September in New York organized by The Economist, there was a fascinating panel on the topic of “Intellectual diversity in an open world”. The discussion was meant to focus on

• How open innovation is changing the way we work
• Global perspectives on managing a global workforce
• The state of the talent war

The moderator: Vijay Vaitheeswaran, Global Correspondent, The Economist, and the panelists were:

Massimo d’Amore, Chief Executive Officer, PepsiCo Beverages Americas

William Clifford, Chief Executive Officer, Spencer Trask

Zabeen Hirji, Chief Human Resources Officer, RBC

Avivah Wittenberg-Cox, Chief Executive Officer, 20-first

In fact, the conversation mainly focused on the rold of women. The discussion began in earnest with Avivah Wittenburg-Cox asking: If the conference which had begun with some big name male thinkers, moderated by erudite male moderators, would the discussion in any way have changed? In substance? Or in tone?

She suggested that the tone at least would have been different: there wouldn’t have been quite so much of the competitive, combative, tone of the moderator’s questions, with all of the masculine energy that women love so much. She attends women-dominated conferences where a lot of energy is spent putting people at ease, so that conversation could flow, rather than putting people on the spot and demanding answers.

Massimo d’Amore offered a fascinating glimpse into the world of Pepsico and the impact of a female CEO. This had brought to light some staggering imbalances in hiring practices. It turned out that 90% of the buyers of Pepsico’s products were women, but most of Pepsico’s buyers had been men. As a result of the discovery of this mismatch, there had been massive staffing changes to Pepsico’s buyers to get more balance between the gender of the customers and the gender of the buyers. It was obvious that a wholly-male workforce of buyers would be less likely to understand the needs of customers who were 90% women. This wasn't an issue of diversity as much as it was an issue of competence.

There was much discussion of the Washington Post article of September 14, 2010, which noted that For the first time, more women than men in the United States received doctoral degrees last year, the culmination of decades of change in the status of women at colleges nationwide.

The number of women at every level of academia has been rising for decades. Women now hold a nearly 3-to-2 majority in undergraduate and graduate education. Doctoral study was the last holdout - the only remaining area of higher education that still had an enduring male majority.

Women have long outnumbered men in earning master's degrees, especially in education. Women earned nearly six in 10 graduate degrees in 2008-09, according to the new report, which is based on an annual survey of graduate institutions.

With these kinds of numbers, there was a sudden realization in the discussion: when women are 60% of talent and 90% of customers, it's not diversity that we are talking about: it's the future. We are looking a very different workplace that is emerging. It is a workplace where male enclaves will be increasingly put in question and where women can be women and bring to bear their different attitudes, perspectives and insights.

Overall, this augurs well for innovation and radical management. Learn more at:

http://www.stevedenning.com/Books/radical-management.aspx

For more on women and management:

It’s not diversity: women are the future

Busting the glass ceiling in high-tech startups

Women in High-Tech Startups: "The Social Network"

Team building: choose women ahead of the next Einstein

The Difference by Scott Page

Disruptive innovation at Nokia: Every CEO's nightmare

In 2004, researchers at Nokia, the world’s leading mobile phone company, presented a prototype of a new kind of mobile phone to the senior management. The phone, which connected to the Internet, had a large bright screen and was operated by fingers on a touch-screen. The researchers believed that the device would be a winner in the fast-growing Smartphone market. Senior management evaluated the proposal and decided that the risks of failure did not warrant the costs: Nokia did not pursue development of the phone.

In 2007, Apple introduced the iPhone with precisely the features that Nokia’s management had opted not to pursue.

By 2010, Nokia’s market share in Smartphones has been devastated. In the United States, its share of the Smartphone market has slipped from 35 percent in March 2002 to 8 percent in April 2010. Since 2007, Nokia shares have lost almost half their value. Even today the world is still waiting for Nokia’s response to the iPhone, as software errors have delayed shipments of its long-awaited N8 touch-screen phone.

Not surprisingly, Nokia’s CEO has recently been replaced—yet another CEO victim of disruptive innovation.

The most frightening thing about disruptive innovation—the phenomenon documented in Clayton Christensen's The Innovator's Dilemma (HBSP, 1997) in which market-leading companies in industry after industry have missed game-changing transformations—is that the mistakes are not the result of "bad" management. Instead, as Alan Murray has noted in the Wall Street Journal, the disasters have occurred because managers were following the dictates of "good" management. They studied their customers. They carefully researched the market and new technologies. They meticulously cultivated innovation. They stringently evaluated new development and weighed the cost of new investment against potential gains. And in the process, they missed disruptive innovations that opened up new customers and markets for alternative blockbuster products.

How can CEOs enable their firms to evolve beyond “good” traditional management and make them as adept at handling disruptive innovation as they have been at implementing disciplined execution? How can innovation become an organization-wide capability, a part of the firm’s DNA?

My suggestion is radical management. To learn more about it, go to:
http://www.stevedenning.com/Books/radical-management.aspx

Sources: This post draws on Kevin O’Brien’s, “Nokia’s New Chief Faces Culture of Complacency” in the New York Times, September 26, 2010 and Matthew Lynn’s “How Nokia Fell from Grace” in Bloomberg BusinessWeek, September 15, 2010.  Alan Murrya’s article appeared in the WSJ on August 21, 2010.

Help spread radical management: Recognize a Leader!

Is there someone in your workplace or community who is exercising leadership that is worthy of the 21^st Century? Are they getting the recognition they deserve? You can give them a shot in the arm by telling their story at RecognizeALeader.com/ and giving them the recognition that is their due.

What happens then? RecognizeALeader.com will email your story to the person you've recognized and post it on the website. The email will cite the story you have written and also invite that person to pay it forward and recognize a leader that they know. In my experience so far, the "Wow!" effect on the person being recognized is pretty amazing and the nice feedback they give back to you is also quite a thrill.

You can watch a 2 minute video about it here.

How does RECOGNIZE A LEADER relate to RADICAL MANAGEMENT? One of the things that really struck me over the last few years in doing research for my new book was that almost everyone I talked to could tell me about at least one workplace or community or school that sounded very much like radical management. These were places where everyone was pulling together and it was all for one and one for all. Sometimes it wasn't their current workplace, but almost everyone knew what I was talking when I spoke about radical management: they had already had at least one such experience!

Yet I also heard quite often that the leaders of those wonderful experiences hadn't gotten the recognition that they deserved. Sometimes those leaders were under fire for "doing things differently" or "stepping out of line" from the traditional bureaucracy around them.

All this got me thinking about what I could do, in addition to The Leader's Guide to Radical Management , that would energize these leaders and encourage them to press ahead and make radical management a more pervasive part of our culture. Obviously I couldn't get far in doing this on my own. It could only work if I could enlist others like you to join with me to do the recognizing. The result is RecognizeALeader.com/. 

There Are No Rules: There are no rules on how to give recognition. For the leader in your life, you can send them an email. Or make a phone call. Or take them to coffee. Or you can do it more publicly on Facebook, or on Twitter, or on RecognizeALeader.com/. But however you do it, do it today. Why?

A Pivotal Moment in History: I believe that the human race is at a pivotal moment in its history. The issue is not whether our organizations are going to be run differently. That will happen inexorably, as a result of the economic rot that is the consequence of traditional management. The issue is whether the change will happen agonizingly slowly, with bruising political battles as described in my post yesterday on "the war on arithmetic" and collective denial by the powers that be as to what needs to be done--a sequence that might last 20, 50 or even a 100 years. Or whether it will happen intelligently, and elegantly and quickly, with people becoming active and doing what it takes for the change to happen now.

Now it's up to you. Are you ready to help spread radical management now? The RECOGNIZE A LEADER movement is just beginning. I hope you will join me in recognizing a leader that you know, and so spread radical management rapidly throughout the world. Do it now here!

Help end the war on arithmetic!

Paul Krugman, the Economics Nobel prize-winner, has written an amusing piece in the New York Times. After analyszing the GOP’s recent Pledge to America and finding that it repeatedly condemns Federal debt, yet proposes to add almost $4 trillion to that debt over the next decade, Krugman concludes that the GOP is launching a war on arithmetic. For all those of who love numbers, this is a pretty serious matter.

Even more seriously, the threat is not only to arithmetic but to the very government of the country, which as Krugman points out is becoming increasingly ungovernable. “Banana republic, here we come.”

It’s a funny piece about deeply serious matters.

It should be read in conjunction with Bob Herbert’s column, “We Haven’t Hit Bottom Yet,” describing the pain felt by the poor who are becoming ever poorer and the middle class who are declining into poverty.

But it should also be read along with the editorials from the other side of the fence in the Wall Street Journal or Fox News that blame Obama and “big government” for virtually all our ills.

The real question that Krugman, Herbert or the other commentators don't get to is why we have come to such a pass? How did we get here? What can we do about it?

Unless we get to root causes, this great country may well end up as a banana republic or worse.

 

Root cause: the real economic pie stops growing

The embarrassing truth, and the root cause of these issues, is that in this country, work has become in a deep sense unproductive. The way of running organizations that worked for much of the 20^th Century has come to the end of its tether. The fact that the economy can no longer provide good jobs for its citizens, that health care is increasingly unaffordable and the education system fails to generate real education are merely symptoms. The real root cause is that the way most established organizations are run has more negative effects than positive ones.

Seeming gains in gross national product turn out to be based on funny money, which was inflated in the 1990s by the Internet bubble, and in the 2000s, by the Wall Street/real estate bubble. When the bubbles had burst and the debris had settled, the apparent gains that had been made were phantoms. When “bad profits” are swilling around the economy in this fashion, profits and income are no longer good guides to the health of the economy. It is now increasingly apparent that we are not going through a business cycle, but rather a phase change, in which the true nature of our current situation is emerging: the economy can no longer provide a good living for its citizens.

The unproductiveness of today’s organizations is such a menacing thought that there is a widespread unwillingness to take seriously any evidence to that effect. Lang Davison, a co-author of The Power of Pull (2010) told me about the workshops that were run by the Deloitte’s Center for the Edge with their findings for example that the rate of return on assets of US companies is one quarter of what it was in 1965, or that the life expectancy of the Fortune 500 companies has declined to 15 years, and heading towards 5 years; the executives were unwilling to take the studies seriously. “We even heard executives say in response to our findings about declining ROA,” Lang said, “that it couldn’t be that bad if the equity markets still value corporate institutions so highly. They are living a delusion, but it’s all the more powerful as it’s a collective delusion, as reflected by the capital markets.”

Resolving the root cause: run organizations differently

These problems are not going be resolved by declaring war on arithmetic, or by writing articles pointing out how ridiculous it is to do so, or by calling Obama a socialist and condemning big government.

Instead of calling each other names, we have to get to the root cause of the problem and run our organizations differently.

The key reason why organizations have declining rates of return on assets is the shift in balance of power from sellers to buyers. The fundamental assumption that big established organizations could sell whatever they produce at a price that gives them a reasonable return on assets and not have to worry much about new competitors in the marketplace, has come unstuck. This is a cataclysmic event for traditional management. And traditional management has yet to come to terms with it. It means that a whole array of organizational practices that have been around over a hundred years no longer fit the current context.

Now unless organizations understand their customers in depth and are continuously coming up with innovations to delight them, the risk is that these organizations will be among the increasingly heavy casualties in the Fortune 500. This is something that traditional management is constitutionally unable to deliver.

Paradoxically, the more rigorously traditional management is applied, the worse the situation gets. Thus as the financial pressure on organizations begins to be felt, the normal response of "good" management is to run a tighter ship and to do the very thing that will make things worse: squeeze more work from the people doing the work. This lowers morale and makes the workers even less productive and innovative. In this way, the company enters a downward spiral of declining returns that eventually lead to the firm’s demise, either by chapter 11 or by being taken over.

Becoming more productive and innovative In a knowledge economy doesn’t mean squeezing more work from the workers. Instead it means creating a context where the workers themselves want to become more productive and innovative. This won’t happen if they are being squeezed to produce more. Instead, they have to be inspired to do to delight clients. The interesting thing is that when companies have been able to create such a context, the workplace generates deep job satisfaction, as opposed to the dispirited morale of traditional management.

The good news is that many organizations are already doing things differently. The practices are described in book after book that arrives on my doorstep, and include books like The Dragonfly Effect by Jennifer Aaaker and Andy Smith or Empowered by Josh Bernoff and Ted Schadler or Open Leadership by Charlene Li or Employees First Customers Second by Vineet Nayar or Reinventing Management by Julian Birkinshaw or The Power of Pull by John Hagel, John Seely Brown and Lang Davison.

A radically different management leads to very different results. It's not just that firms become more innovative and clients are delighted and jobs become more satisfying. Once the real economic pie starts to expand again, then there is more for everyone, and we can begin to resolve the current political stalemate, that stems from the failure of the economic pie to grow in line with the needs of the people: once there is enough to go around, then political solutions become possible again.

Paul Krugman is right that we do need better arithmetic. But better arithmetic by itself won't solve our problems. For that, we need radically different management. To learn more about radical management go here , or start reading my new book on radical management within a minute on Kindle here.

How not to get the best from your people: doing things to people vs doing things with people

I’m normally an optimistic kind of guy. Each month when I receive Harvard Business Review, I open it up thinking that maybe, just maybe, there’s been a change of heart. Maybe they have moved on from 1965. Not much to ask, after all. I become even more optimistic when I read the headline like this month, “Get the Best From Your People”. This, I think, is certainly timely, given the studies that show that only one in five people are fully engaged in their work.

But then I go to the article to which the headline refers. As I read it, I have a growing feeling of horror. There has been no change of heart. There is no heart at all. We are right back in the world of manipulating people with numbers. In fact, we are no longer in 1965. We have regressed back to 1911. We are now in the world of Frederick Winslow Taylor.

The world of Frederick Winslow Taylor

In 1899, Taylor became fascinated by a simple question: How many tons of pig iron bars can a worker load onto a railcar in the course of a working day? Management theorist Paul Stewart depicts the situation:

“Taylor was forty-three years old and on contract with the Bethlehem Steel Company when he began thinking about pig iron. Staring out over an industrial yard that covered several square miles of the Pennsylvania landscape, he watched as laborers loaded ninety-two-pound bars onto rail cars. There were 80,000 tons’ worth of iron bars, which were to be carted off as fast as possible to meet new demand sparked by the Spanish-American War. Taylor narrowed his eyes: there was waste there, he was certain. After hastily reviewing the books at company headquarters, he estimated that the men were currently loading iron at the rate of twelve and a half tons per man per day.

Taylor stormed down to the yard with his assistants (“college men,” he called them) and . . . found a “high-priced man,” a lean Pennsylvania Dutchman whose intelligence he compared to that of an ox. Lured by the promise of a 60 percent increase in wages, from $1.15 to a whopping $1.85 a day, Taylor’s high-priced man loaded forty-five and three-quarters tons over the course of a grueling day—close enough, in Taylor’s mind, to count as the first victory for the methods of modern management.” (Stewart, P. “The Management Myth.” Atlantic Monthly, June 2006. 80-89 at 81.)

After Taylor was let go from Bethlehem Steel in 1901, he went around the United States regaling audiences with stories about the Pennsylvania Dutchman he called “Schmidt” and the improvements in productivity that were achieved through “scientific management.” In due course, his thinking was adopted by an emerging breed of management experts. In 1909, Taylor’s principles of scientific management were introduced into the curriculum of the newly opened Harvard Business School.

In 1911, in The Principles of Scientific Management, Taylor issued his ominous, prescient declaration: “In the past, Man has been first. In future, the system must be first.”Although at times Taylor occasionally professed an interest in improving the lot of workers, he was well aware that “the system” was ultimately about making more money for the company. As he wrote in Shop Management, “The full possibilities of this system will not have been realized until almost all of the machines in the shop are run by men who are of smaller capabilities and attainments, and who are therefore cheaper than those required under the old system.” And so the practice of dumbing down the workplace and outsourcing jobs was born.

The Time-Warped World of HBR

Fast forward to the HBR of October 2010, and the cobwebs of 1911 still festoon the thinking. The “system” has now become translated into “talent analytics”. How do you get the best from your people? You use analytics to pick out the better performers and squeeze more out of them. The analytics are used in six different areas –human capital facts, HR data, human capital investment analysis, workforce forecasts, the talent value model and the talent supply chain. The clever manager uses the numbers to identify the bright spots and ruthlessly cut out the fat and the waste.

How or why some parts of the organization are more productive than others is of no concern here. How any manager should actually interact with those doing the work so as to get the best from them is a subject is no more relevant than it was to Frederick Winslow Taylor back in 1911.

There is a one-sentence aside to the effect that “the success of any initiative depends on its leaders”. But what that kind of leadership might consist of is not a subject for the clever manager to be concerned about. Instead, the clever MBA trained manager resolutely squeezes the best out of people by studying the numbers. Heart, conversation, interaction, communication—none of this enters the picture. It’s all about the numbers.

The fact that HBR trumpets this article as the key to “get the best from your people” shows the mindset of the senior editors of the journal. This is about doing things to people, rather than doing things with people. It’s not that there isn’t an occasional sensible article with a contemporary feel that somehow slips into HBR. There is: the Peter Senge interview (p.70) in the same issue might be seen as an example. But what is perceived as important and central to the challenges of management by the magazine’s senior editors is managing by the numbers. Making more money by doing things to people.

In such a world, who should be surprised that only one in five workers are fully engaged in their work? Or that the life expectancy of a firm in the Fortune 500 has declined to just 15 years, and is heading towards five years, if nothing changes? Or that the rate of return on assets is only a quarter of what it was in 1965?

The real world of 21^st Century management: doing things with people

In fact, the world has changed, unbeknown to the senior editors in HBR. Book after book arrives on my doorstep describing what’s actually going on in the real world of 2010. These are books like The Dragonfly Effect by Jennifer Aaaker and Andy Smith or Empowered by Josh Bernoff and Ted Schadler or Open Leadership by Charlene Li or Employees First, Customers Second by Vineet Nayar or Reinventing Management by Julian Birkinshaw.

All these books confirm that the mindset being pushed by HBR is deadly, both in the workplace and in the marketplace. It kills employees’ spirit, their innovation and their productivity. It leads to bad profits and destroys customer goodwill in the marketplace. Unless management is based on honest, open, human interaction and people are treated as people, nothing works. It’s not a question of setting aside the numbers. The numbers are always there. Measurement is central. But the numbers are measures of progress, not goals in themselves.

Curiously these books cite the same companies that the HBR article cites. Thus the HBR title page claims to reveal “the secrets from Google, Best Buy, Comcast and more”. However in the actual HBR article, the discussion of what’s happening in those companies focuses only on the measurement aspect. It turns the measurement into the whole ballgame. The heart, the honesty, the openness, the interaction that occur in those companies are ignored. As a picture of “how to get the best from your people,” the article is a travesty of how those particular companies are run or why they are successful. The HBR article has picked out a tiny sliver of people management in those companies and highlighted it as the whole story “how to get the best from people.”

It’s like saying the way to get the best out of your players on a sports team is to forget coaching and focus solely on the statistics. Of course, the statistics are an important factor. But they are only one of a number of factors. In sports, as in the modern workplace populated by knowledge workers, the passion of those doing the work is what’s driving the numbers. Any sense that they are being manipulated by the numbers kills their passion and productivity.

How did this fiasco happen?

What probably began life as a modestly sensible article about the role of data in managing people has now been turned by the editors of the magazine into the nonsensical claim that using the numbers to squeeze more out of people is the entire way to “get the best from people.” A ridiculous claim of course, but a viewpoint apparently still prevailing among the senior editors of HBR.

And why does this particular approach appeal so much to them? It’s part of a mental mindset to the effect that management involves doing things to people and the manipulation of them as things, rather doing things with people and interacting with people as adults. Manipulation is cleaner and less messy than human interaction. So that’s what gets headlined in HBR and trumpeted as the way to go. That’s what gets taught in business school. That’s what is still in most management textbooks. It’s a mindset based on manipulating people as things.

For much of the 20^th Century, this worked well enough. It was possible to manipulate the workers and customers and get away with it. But the world changed. First, the work became predominantly knowledge work. As a result, the workers didn’t take kindly to being manipulated. Second, the balance of power shifted from sellers to buyers, who have good information of what’s available and many choices from which to make their purchase. They also didn’t take kindly to being manipulated. Finally, the advent of social media means that customers can fight back with a vengeance when they are being manipulated. As a result, what worked in the 20^st Century doesn’t work in the 21^st Century.

The editors of HBR are pretty smart and highly educated people. Why don’t they understand this? An interesting question. One reader, Pete Laburn, suggested to me Upton Sinclair’s insight: “It is difficult to get a man to understand something, when his salary depends upon his not understanding it.”

Yet I suspect the reasons go deeper and lie in the psyches of the kind of people who have climbed to the top of 20^th Century organizations: they have a preference for inanimate things that operate in a linear fashion. In a linear system, optimizing one part of the system optimizes the whole. It makes manipulating it simple. These situations are easy to control. So there is a continual undertow pushing to see the world as it is inanimate—something that can be manipulated. The fact that the world no longer operates this way is beside the point. It’s more psychologically satisfying to see and treat the world this way.

The problem is that the modern organization is not a linear system. Optimizing one part of it (e.g. by cutting costs in one area can have a massive impact in other areas, both for those doing the work and those for whom the work is done.) The modern organization in a customer-driven marketplace is a complex phenomenon, where every action has multiple reverberations and implications for other parts of the organization and for the marketplace. If you manage this complex organization in a linear fashion, by using the numbers to look for things to cut, you get the results we see today.

What do traditional managers say to this? Simple:

“The life expectancy of a firm in the Fortune 500 has declined to just 15 years, and is heading towards five years, if nothing changes? Only one in five workers are fully engaged in their work? The rate of return on assets is only one quarter of what it was in 1965? No matter. If we work the numbers harder, we can squeeze more out of those human resources.”

Fortunately, there are a whole lot of books now are describing why this doesn’t work and why a radically different way of managing is already occurring in many organization, if only HBR would open its eyes to see.

My own book, The Leader's Guide to Radical Management , is being published over the coming month and gives further insights on how we are evolving from the lethal world of Frederick Winslow Taylor into a kind of radical management and leadership that is worthy of the 21^st Century.

You can learn more about it here or read it within the next minute on Kindle here.

 

How to engage in conversations for change

An interview with Shawn Kent Hayashi on Conversations for Change

  Whether you're trying to motivate a team, negotiate a contract, make a sale, ask for a raise, land a new job, or terminate an employee, the conversations you have will either help you succeed or undermine your goals. 

Shawn Kent Hayashi’s new book is based on more than two decades studying how the things people say impact their business and professional lives.  In her book Conversations for Change: 12 Ways to Say it Right When It Matters Most , she identifies the most important types of conversations people have, and shows readers how to use these conversations effectively. 

My recent interview with Shawn went like this:

1.  Your book suggests that there are common foundations to every effective conversation, even conversations that superficially appear very different. What are these common foundations?

Emotional Intelligence, Preferred Communication Styles and Workplace Motivators are the foundation for all effective meaningful conversation.  What I mean by this is that we need to be aware of our emotions and self regulate so we stay focused on what we want to create or accomplish. The first chapter of CONVERSATIONS FOR CHANGE explains how to do this.  We do not want to have an emotional hijack that takes us off focus.  We also benefit by understanding the other person's preferred communication style and motivators so that we build rapport and common purpose for momentum in our work together.

2.  Which are the most important kinds of conversations in organizations? 

All 12 conversations types are important -- there is not one that is more important than another.  Problems arise when we are missing some of the conversations.  Our preferred communication style gives clarity about which of the types of conversations would be most comfortable and most challenging for us. 

What is easy for your manager or peer may be the most challenging for you -- and vice versa.  For example, I worked with a coaching client who did not know how to have conversations for conflict resolution -- he was very passive and ignored conflict.  This was having a negative impact on his team and his performance.  Once he learned how to confidently create conversations for conflict resolution his management effectiveness increased.  For another executive the conversation that was missing was for connection.  She was communicating her vision and giving direction but she had not taken the time to connect on a meaningful level -- thus she did not know what motivated her team members.  She was troubled by the lack of engagement she saw in her organization but she did not see that her lack of conversations for connection was part of the problem.  When she began to listen and connect around style and motivators with her team members she saw many positive changes.

3.  Can people learn to improve their ability to conduct effective conversations? How? 

Yes!  By thinking about when each type of conversation would be useful and then practicing the ones that are most difficult.

4.  Your book suggests that conversational skills can improve productivity in any business or organization. Could you explain how conversation skills improve productivity?

When we have shared meaning, goals, and direction we accomplish more.  When we are aligned around the goals and understand each person's role and how best to work together we can create amazing results.  This requires regular communication.

5.  What are the four distinct communication styles that the book identifies?

Dominate

Influence

Steady

Compliant

The book highlights what each of these mean, how to identify each style and what to do when communicating with someone whose style is different from yours.

6.  What do you mean by “an effective conversation”? How do you know when a conversation is "effective"?

When meaning is shared or clearly understood between people or a group of people and momentum occurs we have an effective conversation.

7.  What role does authenticity play in effective conversations?

Authenticity is vital for trust.  When we have a shared goal and are able to play to the strengths of each other's preferred communication style, we will experience authenticity in being able to be ourselves at work.

8.  Is a focus on conversational effectiveness compatible with authenticity and genuine listening?

Yes, conversational effectiveness is compatible with authenticity and genuine listening. When we care enough to listen to the other person we are making a deposit in the shared emotional bank account and we build trust.  Active Listening includes several steps:

·        Restate what you heard the other person say in your own words

·        Ask several questions to confirm and clarify based on what you know about the topic

·        Then share your own reaction or views

The more complex or emotional the conversation the more focused on active listening we need to be.

9.  The book details different types of conversations, explaining when to use them and how to develop them, and offering specific phrases to start each dialogue. Is there a risk that scripting conversations in advance in such detail could actually undermine genuine conversation?

The goal is to be clear about the menu of communication options.  We do not want to be so scripted that we are not able to listen in the moment. If we go into a conversation with clarity about what we want, and prepared with the right dialogue, we will be much more effective.

10.  What role does storytelling play in effective conversations?

Our ability to tell a story or to highlight an example is very useful for building rapport and making our point.  Recently, I observed a coaching client using an ineffective communication strategy.  Afterwards I told him a story about me trying to accomplish something with a butter knife and how much simpler the task was when someone brought me a drill and I used it instead.  The drill enabled me to accomplish the task with ease!  I asked him if he'd like me to give him a drill that would be more effective in the particular communication issue he had been working on.  He said, "Yes!'  This was a short story that painted a picture quickly. 

We also need to be aware of the stories we make up in our thinking that are not accurate but that let ourselves off the hook.  Another coaching client of mine, Sarah, shared catching herself creating negative stories.  On a long flight, Sarah asked the stewardess for a cup of tea.  The tea was not delivered.  My client told herself a convincing story that the stewardess was "rude and did not like waiting on women."  Then she turned that into a story about the airline and how they did not hire and train people to be focused on good customer service.  Twenty minutes into this frustrating internal dialogue, the stewardess arrived with the tea and said to Sarah, "I apologize this took a bit longer than I hoped, I have been helping an elderly gentleman who fell."  Sarah realized her own negative story was incorrect and a waste of time.  She realized she had been doing the exact same thing with her boss -- Sarah had made up stories about her boss' actions.  These negative stories did not serve anyone.  Becoming aware of the stories we are making up and what their impact is on us enables our self awareness to grow.

         SHAWN KENT HAYASHI is the founder of The Professional Development Group (www.TheProfessionalDevelopmentGroup.com) and author of five business communication books.  Using an assessment-based approach, her company helps people improve their emotional intelligence, communication skills, build stronger relationships and teams, and make more effective presentations. 

Shawn Kent Hayashi: Conversations for Change: 12 Ways to Say it Right When It Matters Most (McGraw Hill, 2010)

Interview with Julian Burkinshaw: Reinventing Management

Julian Burkinshaw’s Reinventing Managementis a path-breaking book. It begins by explaining why management failed. The problems of management are not the result any single decision, or manager or industry. Rather the problems are systemic and go way back in time. The result of the failure is that managers are not respected; employees are unhappy; and there are no positive role models.

The book proposes a kind of contingency theory of management: different situations demand different kinds of management. To be effective, a manager needs to adapt to the demands of the situation. Managerial behavior is mapped on four dimensions: bureaucracy-to-emergence, hierarchy-to-collective wisdom, alignment-to-obliquity, and extrinsic-to-intrinsic motivation. This leads to main four models of management:

A.      The traditional top-down bureaucracy or “Planning” model—tight means, tight ends; e.g. McDonald’s

B.      “Science” model—tight means, loose ends: e.g. Arup, the international engineering consultancy.

C.      “Quest” model—tight ends, loose means: e.g. do whatever it takes to win, investment banks

D.      “Discovery: model—loose ends, loose means: e.g. Google, change the world.

I talked with Julian recently about his new book:

1.      The book begins by explaining why management failed. How widely do you think is it accepted in business today—and in business schools—that management has failed?

I don’t believe it is widely accepted. The trouble is, our existing orthodox view of management has been a great success for many decades, so its gradual decay is not readily visible to those in the middle of it. But there are many indicators that business executives have lost their legitimacy and that the quality of management, as currently practiced, is simply not as good as it could be.

2.      The book rejects both the view that management can’t be reinvented and also the view that we are on the cusp of inventing a wholly new way of managing. Could you comment on the “third way” that your book presents, which involves “reinventing management” but not doing something that is wholly new?

We are not on the cusp of an entirely new way of managing.  As you say, I argue for a “third way” that lies somewhere between the arguments of those who imagine an entirely new way of managing and those who argue there is nothing new under the sun.  My third way says most of the “new” approaches to management exist, in some form, already, and that the challenge companies need to address is how to choose the RIGHT model for their competitive situation, rather than to blindly follow the herd.  To do this, executives need a framework to help them make conscious and careful choices among competing approaches.  And that is what the book provides.

3.      The book notes that one cause of management’s failure was the aggrandizement of leadership at the expense of management. You cite Henry Mintzberg’s dictum that companies these days are “over-led and under-managed,” and argue that “we all need to be leaders and managers.” Is this about leaders becoming managers, or managers becoming leaders, or both?

It is both. Of course leadership matters, but it should not be built up at the expense of effective management.  For me, effective executives are those who can both set a long term vision and also understand and influence the detailed activities that allow them to deliver on that vision.  Some people might argue that we should separate these two roles out, but for me the people who can span the macro- and the micro- are the ones who are truly effective.

4.      The book notes that the traditional Planning Model of management has difficulty with innovating, with motivating employees and with coping in unstable environments; as a result, many firms have been exploring other options, along the four dimensions described in the book. Yet the book concludes that “there is nothing wrong with the Planning Model, as it can be highly efficient and profitable in a stable and predictable environment.” Are there many business environments today where the Planning Model is still appropriate?

This is a good question.  Empirically, there is plenty of evidence that “planning” model companies like McDonalds and ExxonMobil are doing very well, and have done for many years.  But many people, including myself, have argued that this model is going to become less viable in the years ahead. My hunch is that the number of sectors in which companies can afford to stay with this traditional model (and still do very well) is shrinking.

5.      One of the most original parts of the book is the discussion of the principle of obliquity. It notes that three of the four dimensions are relative familiar concepts: emergence, collective wisdom, intrinsic motivation. But the fourth concept—obliquity—will be unfamiliar to most people. Obliquity concerns the idea that in complex situations, indirect objectives may be more effective than direct objectives. Thus in psychology, we achieve happiness, not by pursuing happiness, but by following our dream; happiness follows as a consequence. In management, the idea that a tight management focus on maximizing shareholder value may induce management actions that actually undermine shareholder value is quite recent. How important is the principle of obliquity for re-inventing management?

Obliquity is the most contentious but perhaps the most important part of the book.  Interestingly, John Kay has just published an entire book on the subject, so this could be an idea whose time has come!  My honest view is that we don’t know quite what obliquity means yet – it is a powerful catch-all for a lot of the non-linear things that happen in business and in life, but it is a concept that evades easy analysis. I expect my next book will give much more considered thought to the concept of obliquity!

6.      The book mainly focuses on the private sector. Do you see management in the public sector as facing essentially the same or different issues?

Yes, I believe that the public sector faces most of the same challenges as the private sector in terms of excessive bureaucracy and hierarchy and so on. But because of the breadth of stakeholders it has to work with the difficulties faced in implementing my proposed ideas are even more severe.  I have done quite a few talks about this work to executives in health care, further education and so forth, and there is no question that the ideas resonate with them.

7.      The book provides an immensely helpful set of dimensions on which firms can find out where they are now, and then plan to make changes as needed, given their particular context. Chapter 9 discusses the leadership agenda that this will involve. How ready are business leaders to tackle this agenda?

Well, there are some leaders who clearly “get it” and are already doing many of the things I talk about.  But most struggle.  I have had many conversations with top executives about how they might move forward with their management innovation agenda, but these conversations often founder because no-one “owns” the responsibility for management innovation, and because the returns to management innovation are often fairly uncertain. It takes a great deal of courage to put in place, for example, a management structure or performance evaluation system that has never been used before.

8.      In the final chapter, you make a plea to “broaden the debate on reinventing management.” Just as war is too important to be left to the generals, so management is too important to be left to the managers; there is a broader social interest in the reinvention of management being successful. To achieve it, we will need more cross-company sharing, new governance models and new rules around the ownership of intellectual property. Thus many parties share responsibility for moving the agenda forward. How ready are they to take up these challenges?

These sorts of collaborative endeavours are incredibly difficult to put together. Witness the failure of the climate change talks in Copenhagen last year, as one example of how difficult it is for independent actors to reach agreement on things that are ultimately in their interests. But they do occasionally happen. For example, consider Dee Hock’s book on the origination of the Visa network, “Birth of the Chaordic Age”. He describes how he was able to persuade a bunch of self-interested bankers to agree to a common set of standards and rules to create the credit card industry we know today.  Obviously there are a lot of factors that have to come together for collaborative endeavours to work. But there is always a person,  or small group of people, at the centre of any such movement, that seek to impose their vision on others. This is true leadership!

ABOUT THE AUTHOR: Julian Birkinshaw is Professor of Strategic and International Management at the London Business School, co-founder of the Management Lab, and the Deputy Dean for Programmes.  He is a Fellow of the Academy of International Business and the Advanced Institute of Management Research (UK). He has PhD and MBA degrees in Business from the Richard Ivey School of Business, University of Western Ontario, and a BSc (Hons) from the University of Durham. He has worked at the University of Toronto, the Stockholm School of Economics, Price Waterhouse and ICI.

Julian Birkinshaw: Reinventing Management: Smarter Choices for Getting Work Done (Jossey-Bass, 2010).

Read The Leader's Guide to Radical Management now on Kindle

Amazon is now delivering The Leader's Guide to Radical Management on Kindle here. Delivery of the physical book will start on October 12. But you get ahead of the game and start reading it on Kindle within the next minute.

Robert D. Steele has posted a fascinating review on the Amazon site, which relates the thinking in the book to a number of other important books in the field of leadership and management. His conclusion:

This is the first book that captures the essence of 21st Century leadership.

Interestingly, Rob Cross, Professor at the University of Virginia, has a similar view:

The Leader’s Guide to Radical Management accomplishes what no leadership book has been able to do in recent times.  It delivers clear insights on the impediments keeping most institutions today from success. Beyond that though it provide tools and means of overcoming these barriers in novel and often counter-intuitive ways.  A must read for leaders attempting to move to the next level of performance.

You can read the book now on Kindle here or place an advance order for the physical book (delivery Oct 12) here, or read more about the book and watch a video here.

Endorsements for The Leader’s Guide to Radical Management

My new book, The Leader's Guide to Radical Management: Reinventing the Workplace for the 21st Century will be published by Jossey-Bass next month. The official launch is October 25, 2010. Here are some of the endorsements that the book has received.

This masterful book is a delight to read—articulate, provocative and illuminating. It isn’t merely radical, it’s revolutionary!

Peter Guber
CEO, Mandalay Entertainment Group

Denning has written an original and brilliant book which transforms "radical management" into doable and, more important, indispensable management. Also an indispensable read!

Warren Bennis
Distinguished Professor of Business,
University of Southern California
& author of the just published:
Still Surprised: A Memoir of a Life in Leadership.

This is a wonderful book. It’s like having an extended conversation with Steve Denning, who is one of today’s most acute and creative critics of traditional management thinking. You would ignore the ideas in this witty, candid and erudite book at your own peril. Denning shows how to re-invent management based on a more accurate and effective understanding of how humans work best together. This book makes a great text for any extended discussion about how we should be doing things. 

Laurence Prusak
Author of Working Knowledge and What’s the Big Idea?

Denning goes to the root of the management issues confronting companies today.  Focusing on seven core principles, he lays out a pragmatic roadmap for shifting the corporation from a focus on scalable efficiency to a focus on delighting the customer and each other, while achieving even higher levels of productivity. In the process, he creates a space where we all can more fully achieve our potential.

John Hagel,
Co-Chairman, Deloitte Center for the Edge

The Leader’s Guide to Radical Management delivers. It delivers insight into why today’s broken institutions don’t work. It delivers the principles and practices that can reinvent them. It delivers powerful examples of organizations that are doing it —and some that aren’t — and it delivers the tools to help you start digging a new foundation.

Jim Kouzes, award-winning coauthor of the bestselling The Leadership Challenge  and The Truth About Leadership; Dean’s Executive Professor of Leadership, Leavey School of Business, Santa Clara University

To reinvent America and the world, we desperately need radical, new leadership and management. Stephen shows the way.
                              Mark Victor Hansen
                              Co-creator of the series Chicken Soup for the Soul®
                             

The Leader’s Guide to Radical Management is the paradigm shift we have been looking for to guide us as we evolve.  This is the first book that focuses on what is truly important to being successful.

Matt Hlavin
President, Thogus Products Company

The Leader’s Guide to Radical Management reframes the way we think about management in a practical, application-driven way.  A must-read for anyone in a management position!

                              Ed Scanlan,
                              CEO, Total Attorneys

This book contributes with principles on radical management and continuous innovation to support an Agile mindset in your entire organization.

Michael Holm
CEO, Systematic Software

I’ve spent the last 35 years of my professional life bushwhacking my way towards what I now know, thanks to Steve Denning, is the nirvana called Radical Management.   It is a place where delighting customers is the religion and creativity, passion and learning are revered.  Denning’s Radical Management is the antidote to the greatest disease in the workplace today, mental resignation due to lack of purpose.  Radical Management should be required reading for anyone entering the work force or looking to reignite their inner bushwhacker!

Sam Bayer,
CEO, b2b2dot0

The official publication date of the book is October 25, 2010. You can place an advance order now at Amazon here. 

Radical management: what to do when your customer is the government

One constraint on implementing radical management is that the customer is on a different path altogether. A frequent example is where your customer is a government bureaucracy. You are aspiring to delight your client, and your client is saying, “Don’t bother with me such questions. Just deliver what the specifications ask for.”

In a June posting, I discussed whether public sector organizations are capable of implementing radical management and delighting their own customers or stakeholders. My answer was: in principle, yes, with certain constraints.

However, realistically, most government organizations are not even trying to practice radical management. One way of understanding how they function is to recognize that organizations operate at three levels, using a schema proposed by Ranjay Gulati in Reorganize For Resilience: Putting Customers At The Center Of Your Business (Boston: Harvard Business Press, 2009)

Level 1: “You take what we make.” Organizations at this level typically say that customers are at the center of the universe, but in practice continue to view the marketplace entirely through the lens of their own goods and services. The customers are incidental to the enterprise. This was the kind of management described in Frederick Taylor’s 1911 classic, The Principles of Scientific Management. It is still the case in most public sector organizations.

Level 2:  “We believe that our offerings will be useful to you.” Firms at this level pay attention to and study their customers, but again, they focus on their customers through the lens of the company’s goods and services, while ignoring the larger problems that the customers may be trying to solve. Most established firms today are still at Levels 1 or 2.

Level 3: “We seek to understand and solve your problems with our offerings”: Firms at this level have made the leap from looking at their world from the perspective of their own products and services to looking at the world from the customers’ perspective and solving the customers’ problems. Firms at this level empathize with their customers and are continually evolving their offerings to meet those issues.

While radical management is operating at level 3, most government organizations are still stranded at level 1. They are paying scant attention to their stakeholders. Often they have not even taken any decision as to who their primary stakeholders are. As a result, no one really knows what the purpose of the organization is. The managers in such organizations typically follow rules and procedures, rather than systematically consider: how could we deliver more value sooner? These organizations are the quintessential bureaucracy, and the management is quintessentially Dilbertian.

The practices of Dilbertian management were described in the famous HBR article: Abraham Zaleznik’s “Managers and Leaders Are They Different?”  Harvard Business Review. 1977, pp. 74-81.

• The manager focuses attention on procedure and not on substance. The manager focuses attention on how the decisions are made, not what decisions to make. That’s because the manager is typically working in a bureaucratic setting where the goals of the organization are neither clear nor perceived as worthwhile. In the place of goals that provide meaning at work and in work, there is a hierarchical structure, precise role definitions, and elaborate rules and procedures, which often conflict: managers have no way of knowing what is the right answer. The only safe place is to focus on process.
• Second, the manager communicates to subordinates and stakeholders indirectly by “signals”, rather than clearly stating a position. The traditional rule-driven bureaucracy requires both managers and workers to leave their personal views and attitudes behind in the entry lobby, before they enter the workplace. In this world, the managers’ personal views are irrelevant. The only safe way to communicate is to make use of the rules and deploy indirect “signals”, which obscure who wins and who loses. The manager hides behind process, saying: “It is not what I or anyone else believe that matters: it is what the system requires.”
• Third, the manager plays for time. With conflicting rules and procedures, and conflicts about priorities between different senior managers, managers have no way of knowing what the right answer is. The idea of using their own judgment is at odds with the idea that they left their own views in the entrance lobby. Hence playing for time and waiting for the dust to settle are ways of always being on the winning side. These CYA routines are played out, up and down the hierarchy.

Such practices are of course the antithesis of radical management. These frustrate the hell out of the people for whom they are supposedly providing goods or services. And they create workplaces that are stultifying to everyone who works there. But they are pervasive in government. When your customer is the government, they create real problems.

Because no decision has been taken as to who are the organization’s primary stakeholders, middle managers will often be unable to say with any assurance what would constitute additional value for the organization. They have made no decision as to who are their primary stakeholders, and haven’t even begun to examine systematically what would delight them more. Because they have no basis for making priority decisions, they act as Dilbertian managers and are unwilling to make any decision on priorities. Hence they cannot act effectively as the client counterpart for radical management.

What is to be done?

There are three main groups of actors.

The top leadership of the organization: These people have the potential clout to make decisions as to who are the primary stakeholders of the organization and then focus the organization on delivering steadily more value to those people. This is not easy but it can done: at the World Bank in 1998, after fifty years of institutional drift, with multiple competing stakeholders—governments of rich countries, governments of poor countries, contractors, NGOs, single-issue lobbyists, people living in poverty and so on—Jim Wolfensohn orchestrated a decision as to the purpose of the organization: the relief of global poverty, putting the poor people of the world as the primary stakheholders of the organization. This then set the stage for focusing the organization on delivering that. In the twelve years since then, progress on achieving that focus has been mixed, but at least a start has been made. Many public sector organizations have yet to make such a start. It is the clear responsibility of the top leadership to make that start.

Mid-level managers: Mid-level managers find themselves in a Dilbertian world of rules, processes and structures, with no clear focus as to what the organization is meant to be achieving. The challenge for them is to create “oases” of radical management, so that in their unit or department, a decision is made as to who the primary stakeholders are, and steps are then taken to deliver steadily increasing value to them. Where possible, the stakeholders should be involved in setting decisions as to what would create additional value for those stakeholders. Doing business in a radical management fashion with such units or departments will be relatively easy. Managers who establish such oases will need to be careful in managing the boundaries with the rest of the organization, which will continue in its Dilbertian rules-based fashion: managers will need to be aware that their unit or department will be perceived as doing things “differently”. It will be more productive than the rest of the organization, and so will attract all of the attention that rule-breakers tend to attract in a bureaucracy. Such oases should be regarded as beachheads for an eventual transformation of the whole organization into radical management.

Firms delivering services to the organization: Similar dilemmas will affect firms providing services to Dilbertian bureaucracies. Because the bureaucracy has made no decision as to purposes, and operates according to rules and procedures, it is unable to say what would delight its stakeholders. Instead, it tends to say, “Just give me X. I’m not interested in discussing how it could be made better or more responsive to my needs. Just give me X.” All too often when ordering products or services, they will issue a long list of specifications that includes all the things that they “might” need, rather than focusing on the few things that would delight their clients. In the language of an earlier post about the difference between 20^th Century and 21^st Century management, they will issue specifications for something that looks like an DVD controller—many buttons but hard to use—rather than something looks like an iPod—few buttons and easy to use.

In these situations, the firm delivering services may have to adopt the second-best solution and practice radical management internally, using a proxy representative for the ultimate client. An unsatisfactory compromise, perhaps, that nevertheless may have payoffs in terms of lowering the cost of its operations. For example, through the continuous innovation of radical management, Toyota was able, over time, to lower its cost of operations so that it could undercut the price of competitors, as well as produce a more durable product. It didn’t have to explain to its customers how it was accomplishing this: it just went ahead and did it. In time, the results eventually became obvious.

To learn more about radical management, go to:
http://www.stevedenning.com/Books/radical-management.aspx