Friday, July 12, 2019

Peter Drucker’s favorite leadership writer

strategy+business, July 12, 2019

by Theodore Kinni

Photograph by FXQuadro

Peter Drucker, the Austrian-American business author and consultant who defined management in the second half of the 20th century, wrote 39 books. Oddly, the word leadership doesn’t appear in any of their titles. In 1954, in his landmark The Practice of Management, Drucker suggested why: “The first systematic book on leadership: the Kyropaidaia of Xenophon — himself no mean leader of men — is still the best book on the subject.”

Kyropaidaia, or Cyropaedia, is the biography of Cyrus the Great, who used military conquest and enlightened governance to create the first Persian Empire around 540 BC. Xenophon the Athenian wrote the bio nearly 200 years later, and it became part of the leadership syllabus for centuries: In his 2001 book, Xenophon’s Prince: Republic and Empire in the Cyropaedia, Christopher Nadon, a professor at Claremont McKenna College (part of a consortium that includes the Drucker School of Management), writes that Alexander the Great and Julius Caesar read Kyropaedia and it was a strong influence on Machiavelli’s The Prince. Thomas Jefferson had two copies in his library.

So what do we know about Xenophon? Drucker’s description of him as “no mean leader” might be based on Xenophon’s own memoir. Titled Anabasis, it’s the story of a misbegotten military expedition, the emergence of a reluctant but talented leader, and a strategic, fighting retreat that saved an army of 10,000 mercenaries stranded deep in enemy territory.

Before he became a writer, Xenophon was embedded in this army, known as “the Ten Thousand.” Around 400 BC, Cyrus the Younger, a distant royal relation of Cyrus the Great, recruited the force as part of a military expedition. Cyrus was generous with favors and promises, but he didn’t bother to mention that his true purpose was to depose his brother, Artaxerxes II, who had inherited Persia’s throne.

Cyrus was killed in the first battle against Artaxerxes. The war lost, a group of generals and captains from the Ten Thousand tried to negotiate safe passage home — and they were betrayed by allies and slain. Thus, the Greek mercenaries found themselves leaderless and without provisions. “Separated from Hellas by more than a thousand miles, they had not even a guide to point the way,” reported Xenophon, who wrote Anabasis in the third person. “Impassable rivers lay athwart their homeward route, and hemmed them in. Betrayed even by the Asiatics, at whose side they had marched with Cyrus to the attack, they were left in isolation.” Read the rest here.

Friday, July 5, 2019

Cloud-based HCM systems should come without surprises

Lent an editorial hand preparing this guide to preparing a reality-based business case for HCM:

Deloitte's Capital H Blog, July 3, 2019

by Marty Marchetti

The business case for cloud-based human capital management (HCM) systems can sound pretty compelling. What CHRO wouldn’t want fast access to the latest advances in HCM technology at a lower overall cost? But my colleagues and I help companies make the move to cloud HCM, and we often get a firsthand view of the mismatch between expectations and reality that was revealed in Deloitte’s 2019 Global Human Capital Trends study.

It is important to have a comprehensive and accurate total cost of ownership for cloud HR before your company commits to it, during the implementation, and after it is in place.

“No surprises” should describe your move to the cloud, and the following 5 questions can help you reduce them. Read the rest here.

Friday, June 14, 2019

Conversational computing

strategy+business, June 13, 2019

by Theodore Kinni

Steve Jobs could be relentless when he wanted something. In early 2010, he wanted a small startup in San Jose, Calif. CEO Dag Kittlaus and his cofounders had just raised a second round of funding and didn’t want to sell. Jobs called Kittlaus for 37 days straight, until he wrangled and wheedled a deal to buy the two-year-old venture for Apple at a price reportedly between US$150 million and $200 million. The company was Siri Inc.

Wired contributor James Vlahos tells the story of how Siri took up permanent residence in the iPhone in his new book, Talk to Me. It’s the first nontechnical book on voice computing that I’ve seen and a must-read if you have any interest in the topic.

Vlahos spends the first third of Talk to Me describing the platform war currently raging in voice computing. It details the race among the big players, including Amazon, Google, and Apple, to embed AI-driven voices in as many different devices as possible, as they seek to dominate the emerging ecosystem. The fact that Amazon now has more than 10,000 employees working on Alexa provides a good sense of the dimensions of that race.

But voice computing is more than a platform play. It is likely to have ramifications and applications for every company, especially if Vlahos’s contention that “the advent of voice computing is a watershed moment in human history” turns out to be right.

“Voice is becoming the universal remote to reality, a means to control any and every piece of technology,” he writes. “Voice allows us to command an army of digital helpers — administrative assistants, concierges, housekeepers, butlers, advisors, babysitters, librarians, and entertainers.” Voice will disrupt the business models of powerful companies — and create new opportunities for upstarts — in part because it will put AI directly in the control of consumers, Vlahos argues. “And voice introduces the world to relationships long prophesied by science fiction — ones in which personified AIs become our helpers, watchdogs, oracles, and friends.” Read the rest here.

Transformation in energy, utilities and resources

Learned a lot lending an editorial hand here:

PwC, June 13, 2019

The world is at the midpoint of a massive energy-related transformation. By 2040, the global demand for all forms of fuel and power will be four times what it was in 1990. During the same 50 years, the issue of global climate change will have moved from the margins to the centre. Institutions everywhere will be striving to address climate-related problems by dramatically decreasing and mitigating carbon use.

In the energy, utilities and resources (EU&R) industries, the relationship between these two dynamics — the rise in demand and the recognition of carbon use as a climate threat — is already determining basic strategic choices. And it will continue to do so for years to come. This development will profoundly affect a wide range of companies: producers of all forms of energy; disseminators and sellers of electric power, gas and oil; energybased process industries such as chemicals and steel; and producers of other extracted commodities. Leaders in all those businesses will need the acumen to make and execute decisions that combine growth with environmental sustainability, often in novel ways.

The ability to take this new approach to management, especially for companies that have been successful in the past, is not guaranteed. Thus, transformation — the ability to make fundamental shifts in strategy, operating model and day-to-day activity — is on the agenda for EU&R companies this year, with a stronger sense of urgency than before. Fortunately, because of the rise of digital technology, the growing use of interoperable platforms and an emerging consensus about the value of renewable energy, EU&R companies have more tools and opportunities than ever before for thriving through this disruption. 

The urgency became clear in the results of a number of surveys conducted recently by PwC — including those of chemical company CEOs, oil and gas company CEOs, and power and utilities companies — and it is especially pressing in the utilities sector. For instance, when we surveyed senior executives in Germany’s energy sector in 2018, 77% said that the bulk of their company’s revenues would continue to come from their core businesses over the next five years, yet 57% of them expected those revenues to fall over the same period. Likewise, in chemicals, according to our 22nd Annual Global CEO Survey trends series, the next decade is likely to see the sector come under increasing pressure on a range of sustainability measures. In short, although the demand for EU&R’s elemental commodities will grow and its essentially extractive, capital-intensive nature will not change, business as usual will not be a viable alternative for many companies. Read the rest here.

Sunday, June 2, 2019

Managerial hubris brought down MacArthur

strategy & business, May 29, 2019

by Theodore Kinni

Photograph by Pictorial Press Ltd / Alamy

I find hubris to be a fascinating cognitive flaw. Perhaps the spectacle of arrogance leading to a fall from grace provides a socially acceptable outlet for my predilection for schadenfreude — another obnoxious personality glitch. But my flaws don’t matter all that much. I’m not a leader.

For leaders, the consequences of cognitive flaws like hubris are magnified. And nowhere is the danger of managerial hubris more evident than in the career of General Douglas MacArthur, whose life and career I studied for my book No Substitute for Victory: Lessons in Strategy and Leadership from General Douglas MacArthur. In June 1950, when President Harry Truman appointed him to head the United Nations Command at the start of the Korean War, MacArthur was already a prime candidate for hubris. He had served as commander of the U.S. Army Forces in the Pacific in WWII and was still, at age 70, serving as the de facto leader of postwar Japan and its more than 80 million citizens. He was, as biographer William Manchester put it, an “American Caesar.” It is unlikely that MacArthur would have objected to the characterization, had he been alive to hear it.

If MacArthur had an elevated sense of ego and invincibility by 1950, his initial success in prosecuting the Korean War surely reinforced the feeling. As the UN forces fought to hang on at Pusan, their last foothold on the Korean Peninsula, MacArthur mounted an audacious, large-scale amphibious attack well behind enemy lines at the port city of Inchon. The plan was risky, if not foolhardy: Inchon’s 30-foot tides are so extreme that the window for making the assault was limited to two days in September. Moreover, if the landing forces had been unable to take the port, they would have been trapped.

As it turned out, the Inchon invasion was a complete success. The North Korean Army reeled in surprise, and a day later, the UN forces at Pusan broke out. Within two weeks, the invaders had been expelled from South Korea and the UN forces crossed the 38th Parallel, heading north to the Chinese border. The stage was set for one of the 20th century’s most dramatic exhibitions of hubris. Read the rest here.

Friday, May 24, 2019

Are meaning & purpose missing for your workforce?

Learned a lot lending an editorial hand here:

Capital H Blog, May 24, 2016

by Matthew Deruntz and Christina Rasieleski

Organizations are increasingly offering lavish perks to attract and retain talent, and then tracking their success with annual engagement surveys. But what if they’re missing the point?

Despite a laser-like organizational focus on what is traditionally called employee engagement, most people remain less than satisfied with their jobs. Deloitte’s 2019 Global Human Capital Trends survey points to what may be really missing. Many workers lack autonomy and access to the tools and information they need; moreover, they aren’t satisfied with the design of their jobs or the day-to-day flow of work. In fact, most survey respondents rated their organizations only “somewhat effective” or “not effective” on a number of factors related to experience: positive work environment, meaningful work, growth opportunities, trust in leadership, and supportive management. These aren’t issues that organizations can address with free doggie daycare or on-site CrossFit. Instead, they need to reevaluate the fundamental human needs of their workforce.

For better or worse, work holds such a dominant place in many people’s lives that when it fails to meet their innate need for meaning and purpose, their entire lives can become less satisfying and fulfilling. To address this issue and recognize that everyone who contributes to the organization—whether as a full-time employee, contractor, or gig worker—is an individual with intrinsic human needs, organizations need to pivot from thinking about an “employee experience” to thinking about a “human experience” for their workforce. Read the rest here.

Tuesday, April 30, 2019

Bad meetings no more

strategy+business, April 30, 2019

by Theodore Kinni

Aldous Huxley had it wrong. Bad meetings — not mescaline — open the doors of perception. They lull me into a trance. I occasionally surface (did I snore?), murmur agreement (to who knows what), surreptitiously check my phone, and nod off again. If the deep breathing I often hear on conference calls is any clue, I’m not the only one who achieves spiritual transcendence in bad meetings.

The authors of how-to books about meetings never consider the salutary effects of bad ones. Instead, they typically start with an adrenalin-like shot of statistics. Steven Rogelberg, Chancellor’s Professor at University of North Carolina, Charlotte, and author of The Surprising Science of Meetings, is no exception to the rule. He offers the usual litany of dismay. There are about 55 million meetings per day in the U.S. alone, and they cost US$1.4 trillion annually, not counting indirect costs such as employee frustration. “Too many meetings” is cited as the top time-waster by 47 percent of U.S. workers.

Nevertheless, Rogelberg doesn’t think that companies should eliminate meetings. “Was the great management guru Peter Drucker correct when he said, ‘Meetings are a symptom of bad organization. The fewer meetings, the better’?” Rogelberg asks. “The answer is an emphatic ‘no.’ Abolishing meetings is a false solution. Schedules with too few meetings are associated with substantial risks for employees, leaders, teams, and organizations.” Instead, the author advises breaking the cycle of bad meetings with the application of meeting science.

If anybody has a claim on the role of meeting scientist, it’s Rogelberg. He has been researching meetings using field surveys, laboratory studies, and experiments incorporating planted accomplices for 15 years. In this book, he weaves his findings and the research of others into an evidence-based approach to meetings that is sometimes eye-opening. Read the rest here.

Tuesday, April 23, 2019

Does your rewards strategy identify and address employee stressors?

Learned a lot lending an editorial hand here:

Inside HR, April 23, 2019

by Pete DeBellis

What is the basis for your company’s rewards offerings? For too many companies, it is purely benchmarks – that is, they make rewards decisions based on the rewards being offered by other companies with whom they believe they compete for talent. The problem: companies that follow this approach are left guessing about the desires and stressors of their actual workforce rather than knowing definitively what they want or need. In fact, based on Deloitte’s 2019 Global Human Capital Trends report, nearly one-quarter (23 percent) of organisations do not feel they know what rewards their employees value.

There’s nothing wrong with benchmarking per se: You should know what rewards your competitors are offering their employees. But that’s only one piece of the rewards puzzle. To optimise a rewards offering, you need to know a lot more about your rewards customers, that is, your company’s employees. Our research at Bersin finds that companies with mature, high-performing rewards functions achieve this by adopting some version of the following 4-step process, which uses the same kinds of surveys that marketers use to understand customers. Read the rest here.

Thursday, April 18, 2019

In praise of the purposeless company

strategy+business, April 18, 2019

by Theodore Kinni

Photograph by Avalon_Studio

These days, my vote for the most misunderstood and misused management concept goes to “corporate purpose.” Back in 1973, the concept was crystal clear to Peter Drucker, who declared with admirable concision in Management: Tasks, Responsibilities, Practices: “There is only one valid definition of business purpose: to create a customer.” Since then, however, the definition of corporate purpose has mutated into pretty much any reason for being in business that isn’t explicitly connected to making money.

Business professors Sumantra Ghoshal and Christopher A. Bartlett unbottled this genie in a 1994 article in Harvard Business Review, in which they argued that strategy (“an amoral plan for exploiting commercial opportunity”) wasn’t enough: “A company today is more than just a business. As important repositories of resources and knowledge, companies shoulder a huge responsibility for generating wealth by continuously improving their productivity and competitiveness. Furthermore, their responsibility for defining, creating, and distributing value makes corporations one of society’s principal agents of social change. At the micro level, companies are important forums for social interaction and personal fulfillment.”

Why was a highfalutin corporate purpose seen as such a big deal? IGhoshal, who passed away in 2004, and Bartlett, who is now professor emeritus of business administration at Harvard Business School, concluded that companies had to transform themselves from economic entities to social institutions. They added that the “definition and articulation [of purpose] must be top management’s first responsibility.” Read the rest here.

Thursday, April 11, 2019

We Lead People, Not Cardboard Cutouts

Learned a lot lending an editorial hand here:

Forbes, April 11, 2019

by Michael Gretczko


My wife and I just took our 5-year-old fraternal twins on a skiing vacation. Our daughter is caution incarnate. She likes to ski in a familial caravan — one parent ahead and one behind — and she wants constant feedback about her performance. Our son likes to get a rough idea of the conditions — icy here, snowboarders there — and push off. He doesn’t mind falling and doesn’t particularly care what we think of his performance. It’s astounding how different twins can be.

I’m constantly amazed how my children can uncover insights that allow me to see my role as a leader in a new light. I’m always seeking new ways to create engaged, high-performing teams, and typically, that devolves to some type of employee segmentation, by generation, job description or personality. We’re told that millennials often prefer to work this way, programmers want to work that way, and that Driver and Pioneer Business Chemistry styles want to work yet another way. But if my twins respond best to radically different conditions and parenting styles, can any type of segmentation be granular enough to respond to the individual needs of employees?

I suspect that it can’t. To engage with people on a truly human level — that is, to get beyond the employees-as-interchangeable-assets mindset — we need to be far more responsive to employees as individuals. Read the rest here.

Large businesses don’t have to be lousy innovators

strategy+business, April 11, 2019

by Theodore Kinni

Photograph by Kanchisa Thitisukthanapong

Gary Pisano, author of Creative Construction: The DNA of Sustained Innovation, doesn’t buy the idea that large enterprises are inherently lousy innovators. Back in 2006, Pisano, the Harry E. Figgie Professor of Business Administration at Harvard Business School, traced the origin of every drug approved by the FDA over a 20-year period to either one of the world’s 20 largest pharmaceutical companies or one of the 250 smaller, supposedly more innovative biotechs. When he compared the two groups, he discovered a “statistical dead heat” — R&D productivity was no better in the smaller biotechs than in big pharma.

Pisano also points to anecdotal evidence to support his opposition to the conventional wisdom about innovation in large enterprises. For every big, established company that failed at transformational innovation (think Blockbuster, Kodak, and Polaroid), he points to another that has succeeded. In 1964, when IBM announced its revolutionary 360 mainframe computers, it was already the largest computer company in the world and ranked 18th on the Fortune 500. In 1982, when Monsanto scientists invented the foundational technology for GMOs (genetically modified organisms), the company was 81 years old and number 50 on the Fortune 500. And in 2007, when Apple launched the iPhone, it had sales of US$24 billion and already stood at 123rd on the Fortune 500.

Pisano says that the difference between a Blockbuster and an IBM is the ability of leaders to sustain and rejuvenate the innovation capacity of their companies. It’s an ability he calls “creative construction,” and he writes that it “requires a delicate balance of exploiting existing resources and capabilities without becoming imprisoned by them.”

Walking that tightrope is a challenge for large companies. It’s tough to move the needle with innovation when the needle’s scale is measured in billions of dollars. “For J&J [Johnson & Johnson] to maintain its historical rate of top-line growth,” reports Pisano, “it must generate about $3 billion–$4 billion of new revenue per year.” The complexity of managing innovation in large organizations can also be daunting. “When you get to be the scale of a J&J, you have a lot of moving parts,” he explains. “You now have a system with serious frictions. Friction impedes mobility. Lack of mobility means lack of innovation.”

But large companies also have some advantages that can give them a leg up in innovation. “Larger enterprises like J&J have massive financial resources to explore new opportunities,” says Pisano. They can hedge their bets, tap deep reservoirs of talent, navigate regulatory agencies, and use their huge distribution networks and strong brands to roll out new products to millions of existing customers. Read the rest here.

Wednesday, March 20, 2019

Leadership lessons from a guitar hero

strategy+business, March 19, 2019

by Theodore Kinni

About an hour into Still on the Run, a documentary exploring the career of rock guitar god Jeff Beck, Eric Clapton, another deity in the pantheon, pops up on screen and says, “I don’t even know how he’s doing it half the time.” Clapton is talking about Beck’s ability to give voice to the guitar. But his comment set me to wondering how Beck developed his unique style and what, if any, lessons his nearly 60-year career might offer those who aspire to reach the top of the business world.

With CEO tenure in large companies running five years or so, the fact that Beck has been numbered among the world’s best guitarists for about 10 times that long is worth exploring. Surely, innate talent and endless hours of practice count for a lot. But loads of guitarists have both, and haven’t had careers that lasted as long as the average CEO’s. Beck, however, has been an inveterate seeker of innovation in both technology and technique. And this habit has enabled the 74-year-old London-born musician to continuously expand his capabilities and transform his sound.

Jeff Beck performs at the Bataclan in Paris in 1973.

Photograph by Philippe Gras / Alamy

As biographer Martin Power tells it in Hot Wired Guitar: The Life of Jeff Beck (Omnibus Press, 2014), Beck’s parents valued musicianship, but not the electric guitar, which in the 1950s was associated with rockabilly and other disreputable musical genres. When his parents refused even to spring for new strings for a borrowed guitar, the teenager began building his own crude instruments. Unable to tune his early efforts, Beck learned to bend the strings to pitch while playing, a work-around that became a signature. The wannabe lead guitarist stole the pickup needed for his first electric guitar and built its amp in his school’s science department. Since then, Beck continually explored and adopted technological advances in guitar effects and electronics — such as tape-delay units, fuzz boxes, and guitar synthesizers — to shape and extend his playing.

Beck’s eagerness to learn and incorporate techniques from far-flung places is another hallmark of his career. Like Clapton, he learned from American blues giants — and rode the wave of cultural appropriation that gave rise to rock and roll. According to Power’s biography, Beck says that the first time he heard Jimi Hendrix play, he thought, “Oh, Christ, all right, I’ll become a postman.” Then he followed Hendrix around to learn how he created his sound. Other inspirations include a women’s choir that recorded Bulgarian folk songs, operatic tenor Luciano Pavarotti, and electronic dance music. Beck describes his resulting style as “a form of insanity…. A bit of everything, really. Rockabilly licks, Jimi Hendrix, Ravi Shankar, all the people I’ve loved to listen to over the years. Cliff [Gallup], Les [Paul], Eastern and Arabic music, it’s all in there.” Read the rest here.

Saturday, March 2, 2019

Finding your company’s cultural sweet spot

strategy+business, March 1, 2019

by Theodore Kinni

“Culture eats strategy for breakfast” is a pretty tasty bon mot, though it’s doubtful that Peter Drucker, who usually gets credit for it, actually cooked it up. It can also cause severe indigestion when leaders ignore it. If you’re tempted to join them, read Rule Makers, Rule Breakers, by University of Maryland, College Park, psychology professor Michele Gelfand.

Gelfand has been studying culture and social norms for more than 20 years. Ever wonder why conjuring up a “burning platform” galvanizes workers instead of sending them scurrying for the exit doors? It’s the same reason that the heartbeats of firewalkers in the Spanish village of San Pedro Manrique, as well as the people watching them, become synchronized. It’s also why test subjects who eat fiery chili peppers together report a higher sense of bonding, and work better together in subsequent economic games. “Social norms, like participating in rituals, can increase group cohesion and cooperation,” says Gelfand.

Social norms are the glue that holds groups together. “They give us our identity, and help us coordinate in unprecedented ways,” Gelfand writes. “Yet cultures vary in the strength of their social glue, with profound consequences for our worldviews, our environments, and our brains.” And for companies, too. Read the rest here.

Friday, March 1, 2019

Two Capabilities for Building Organizational Agility

Learned a lot lending an editorial hand here:

Boss Magazine, March 2019

by David Mallon

deloitte agility, boss magazine

A few years ago, agility was considered a competitive advantage — a trait that a company could develop and nurture to get a leg up in its industry and markets. But late last year, when Forbes Insights conducted a survey of 1,000 executives across industries and geographies, 81 percent of them identified organizational agility as the most important characteristic of a successful organization. Today, agility isn’t about raising the competitive stakes; it’s an organizational trait needed to get into the game.

At its core, agility is simply the ability to change direction quickly in response to external conditions. The problem, of course, is that for the past century, people have been building companies that were anything but agile.

How can you make your company more agile? Focus your efforts on developing the two capabilities that define the trait: sense and response. Read the rest here.

Wednesday, February 13, 2019

Middle Managers Deserve More Respect

strategy+ business, Feb. 13, 2019

by Theodore Kinni

Middle management don’t get no respect, to steal a line from Rodney Dangerfield. In popular culture, middle managers are often the butt of the joke — picture the oily sleazeball in Office Space or the pointy-haired cretin in Dilbert cartoons. Their position betwixt executives and employees has been characterized as “an impenetrable layer of suck.”

Gary Hamel of London Business School thinks middle management should be eradicated; Bob Sutton of Stanford doesn’t like it but grudgingly acknowledges its inevitability — death, taxes, and the branch manager. The New York Times isn’t publishing a “Windowless Office” column about today’s most interesting managers, nor are business book readers clamoring for bios of the manager of a Tesla store or the director who runs a portion of iTunes. None of us looks to managers for leadership lessons. But maybe we should.

Most of the leaders I knew in my short career as a full-time employee weren’t CEOs. In more than a few of those jobs, I didn’t know the CEO’s name. It turns out that I’m not unusually oblivious: A 2017 survey found that 23 percent of Americans who work at companies with more than 500 employees are unsure of the name of the CEO. Thirty-two percent aren’t sure they could pick their CEO out of a lineup — a task that they will never be called upon to perform, hopefully. But we can all reel off the names of our managers.

That’s because managers are our leaders. They direct, coach, and appraise us. They play an outsized role in the quality of our work lives and work–life balance. They provide us the opportunities to grow and advance professionally. Aside from a few self-made founders like Mark Zuckerberg and scions like Donald Trump, I’d bet that almost all CEOs of large enterprises owe their positions to managers who recognized their potential early on and encouraged them to realize it. Read the rest here.

Sunday, February 3, 2019

How to design a collaborative rewards strategy which improves profit margins

Learned a lot lending an editorial hand here:

Inside HR, January 30, 2019

by Pete DeBellis

You’ve probably heard the ancient Indian fable about the blind wise men and the elephant. In it, each of the men touch an elephant in a different spot – trunk, tusk, ear, leg, tail, etc. Unsurprisingly, each comes away with an incomplete and inaccurate description of the beast. Trying to design and manage employee rewards from a functional silo presents a similar challenge.

When rewards professionals isolate themselves in a silo, they are, in essence, choosing to work with blinders on. They can’t see the full picture – missing critical details and nuances regarding how rewards can support talent acquisition and retention, and drive employee productivity and business results, among other things.

Consequently, the rewards that they design, which often add up to the largest expenses on a company’s P&L, don’t generate the return that they could and should, and their definition of “rewards” may be missing key elements of their employer’s value proposition, such as learning and development opportunities and much more.

Is this the case in your company? Bersin’s latest research into High-Impact Rewards suggests that approximately 80 percent of organisations are struggling to meet the expectations of their employees around rewards and are failing to drive high levels of maturity in their rewards function.

In many of these organisations, there is no or little collaboration between the rewards function and other HR functions, including talent acquisition, people analytics, learning and development, and diversity and inclusion. Moreover, when cross-functional communication does occur it tends to be unidirectional, with rewards functions sharing data, program, or policy information as needed and in a manner that does not generate or support true collaboration.

To help remedy this, the HR suite as a whole should look to embed regular communication across the suite, whether that means check-ins between functional leaders on a recurring cadence or, for more fluidity, deploying an online collaboration space.

The other 20 percent of organisations have more mature rewards functions. In these companies, rewards professionals collaborate consistently with their colleagues in other HR functions – especially talent acquisition – and throughout the broader organisation. Information sharing is a two-way street through which rewards teams not only share information, but also receive it from these other functions. Using such an approach with collaboration as a regular practice helps surface insights that can help rewards professionals design and deploy a compelling rewards offering, while also supporting the strategic mandates of other HR functions. Read the rest here.

Friday, February 1, 2019

Will Manufacturers Rule the Global Economy Once More?

strategy+business, February 1, 2019

by Theodore Kinni

We’ve been treated to various versions of manufacturing in the past couple of decades. There’s manufacturing as an exercise in financial arbitrage — a link in a global supply chain that is reforged whenever and wherever people will do more work for less pay. There’s the maker movement, populated by hordes of entrepreneurs laboring away in shared shops. There’s Industry 4.0, where we inefficient humans need not apply. There’s the revitalized rust belt, polished to a mirror’s shine with tariffs. And now there’s Tuck School of Business professor Richard D’Aveni’s vision of manufacturing, detailed at length in The Pan-Industrial Revolution, a book that starts out strong but eventually bogs down in speculation.

D’Aveni’s version of manufacturing could be labeled “when dinosaurs rule the Earth once more.” He thinks that hulking tyrannosaurs like battered General Electric are going to rise up and roar in the years ahead. If he’s right, the Dow Jones Industrial Average might actually become industrial again.

D’Aveni weaves this new vision on an intricate loom. Its weft is composed of additive manufacturing (AM), which includes all the evolving forms of 3D printing in combination with other production technologies, such as lasers and robotics; its warp is digitized, AI-powered management systems and platforms.

AM is a game-changing family of technologies, and D’Aveni illustrates them with a host of gee-whiz examples. Lockheed Martin can 3D-print the entire body and interior of its 12-ton, 50-foot-long F-35 fighter jets in about three months, compared with the two to three years it takes to make them using traditional technologies. (It’s now working to cut production time to three weeks.) Electronics parts supplier Lite-On is using 3D printers to make 15 million smartphone antennas annually, demonstrating the technology’s potential for cost-effective mass production. The medical device company Stryker, which is already 3D-printing joint implants, is developing machines that can be installed in hospitals to produce customized implants while surgeons and patients wait. Local Motors has demonstrated its ability to 3D-print a car — reducing the number of parts needed from 30,000 to 50. Read the rest here.

Wednesday, January 9, 2019

Ken Iverson’s Plain Talk

strategy+business, January 7, 2019

by Theodore Kinni

Twenty years ago, in 1998, my agent called and asked if I’d be interested in coauthoring a business book aimed at identifying 21 companies that would lead the way in the 21st century. If you know anything about the vagaries of prediction, you can imagine what a lesson in humiliation that gig turned out to be. (Oh, 3Com; oh, Nokia.) But on the plus side, the project introduced me to F. Kenneth Iverson, a highly successful corporate leader who isn’t nearly as well remembered today as he should be — and whose simple and clear directives from the late 20th century resonate clearly in the 21st century.

At the time, Iverson’s memoir/management exposition, Plain Talk: Lessons from a Business Maverick, was newly published. And he was chairman of Nucor Corporation, which, under his leadership, had come from nowhere to run circles around Big Steel and compete head-to-head with heavily subsidized foreign steelmakers.

Iverson, born in 1925, revolutionized the steel industry. But that wasn’t his initial intent. In 1965, he was a vice president at Nuclear Corporation of America, a profitless company in which he headed a unit making steel joists. As bankruptcy loomed, the board fired the company’s president and offered Iverson the position. “Apparently, managing the only profitable division in the company made me presidential material,” he recalled in Plain Talk. “Although I was just 39 years old, I wasn’t too flattered. No one else wanted the job. It was mine by default.”

Iverson didn’t waste time formulating a grand or complex strategy. He returned the company to profitability by doubling down on what worked: He focused on steel joists and sold off everything else that was losing money. Neither did he have the luxury of pursuing disruptive innovation. He was too busy trying to make money in a commodity business the old-fashioned way: by reducing costs and driving up productivity.

He also invested, somewhat counterintuitively, in vertical integration. In 1968, when the rising cost of bar steel (the main ingredient in steel joists) started squeezing profits, Iverson decided to make it instead of buy it. Unable to come up with the couple hundred million dollars needed to finance a traditional smelting mill, he latched onto the then-emerging minimill concept, in which electric arc furnaces melt scrap iron to make low-cost steel. By 1970, the minimill, which Iverson built with a US$6 million bank loan, was producing more steel than the steel joist business required and became a profit center in and of itself. In the years that followed, Nuclear Corporation of America was renamed Nucor, and it built more minimills and expanded into steel decking, bolts, and sheet steel. Read the rest here.

Saturday, January 5, 2019

Unlocking growth in the B2B telecom segment

Learned a lot lending an editorial hand here:

PwC, January 2019

by Wilson Chow, Rolf Meakin, Mike Lawley, and Joseph Tagliaferro  

In the past five years, telecom operators have recorded an average compound annual growth rate of -0.4% for their B2B activity. The industry’s cash cows are in decline. These include legacy wireline offerings, such as multiprotocol label switching, plain old telephone service and digital subscriber line services. The catch rates on newer internet-based products have not been high enough to pick up the slack. Moreover, the complexity of the industry’s legacy technology, business and operations support systems has stymied efforts to both reduce costs and bring innovations to market. 

Buyers of B2B telecom services are also frustrated with what they perceive as a lack of responsiveness within the industry — a condition that has resulted in a high level of customer churn. Their dissatisfaction is exacerbated by a demographic changing of the guard: more and more buyers have service expectations set by a lifetime of dealing with digitally native consumer companies such as Amazon and Netflix. They expect service requests and delivery to be fulfilled on demand, and they don’t want to do business with telcos that can’t meet their expectations.

The new competitors, attracted by this combination of industry sluggishness and customer unrest, fall into two broad categories. The first includes companies such as Cisco, Juniper and Brocade; they seek to establish direct relationships with enterprise customers. They expect to do this by building a broad base of customers in the B2B market and selling services that overlap with telcos’ offerings, such as software-based VPNs and firewalls. The second group of competitors, which includes companies such as Amazon and Masergy, is seeking to disrupt the industry in a more fundamental way, less bound to established offerings. These companies are leveraging their agility and digital savvy to create new kinds of customer-centric solutions, test them with early adopters and bring them to market at an unprecedented pace — a pace that telcos struggle to match.

Telecom operators know they have advantages, particularly in their networks and long-established relationships with enterprise customers. They know that to better serve existing customers, win over new ones, reverse declining revenues and stymie competitors, they will need a major shift in their capabilities and outward-facing identity. This requires transformation. But knowing the effort and investment involved in transformations, and the high rates of failure, how can telecom leaders improve the odds for success? Read the rest here.

Tuesday, December 18, 2018

What are the 3 capabilities of highly effective HR leadership in the future?

Learned a lot lending an editorial hand here:

Inside HR, December 14, 2018

by Jeff Mike

It’s an exciting and challenging time to be in HR leadership. Elemental forces are driving HR out of its long-established functional orbit around the business and pulling it into the core value drivers. Leaders who can effectively navigate this positional shift will have an unprecedented opportunity to bolster business outcomes and worker productivity as well as their own careers.

The forces behind this opportunity include a fundamental shift in the character of companies and a related shift in the nature of work itself. Changing demographics, particularly the attitudes of Millennials and Gen Xers, are pushing companies to embrace and act on purposes that are broader and more fulfilling than profit alone. Witness the rising incidence of employee activism in Silicon Valley and the emergence of the social enterprise.

Digital technologies are not only amplifying the demands of employees (and indeed, all corporate stakeholders), but they also hold out the tantalising promise of a more collaborative and productive workplace. As the tools of data-driven decision-making become more available to employees at all levels, work itself can be reimagined and the role of management fundamentally reshaped.

Instead of command-and-control hierarchies, companies can perform more like symphonies. We are already seeing this trend manifesting in the emergence of what we call the symphonic C-suite, in which siloes are torn down and top leaders play together as a team while also leading their own functional teams, all in harmony.

The above developments are people-centered, and that’s why HR is being pulled into the core of the business. To be able to successfully occupy that space, HR leadership will need three important capabilities that have been revealed and confirmed by Bersin’s high-impact HR research. Read the rest here