Monday, March 21, 2011

Beauty and the beast

Tina Brown's Newsweek has an interesting new back page feature -- a guest column called My Favorite Mistake. It's probably going to turn out to be a back-handed way for famous people to stroke their own egos. But I got a kick out of the inaugural column which featured this story from movie mogul Harvey Weinstein:


One of my all-time classics happened when I took a plane to England and ran into Kate Moss and Linda Evangelista on the flight. They were both dating friends of mine and couldn’t have been happier to see me. They wanted to initiate me, as I was a two-pack-a-day smoker, into their habit of smoking in the bathroom on the plane. So, whenever one of them was there, I got away with it. But the one time I tried it myself, I got caught. I said to the attendant, “When I smoked with Kate Moss, you never busted me,” and he replied with the magic words: “You are no Kate Moss.” Could there be a truer statement? They nearly arrested me, and I had to go to court and pay a small fortune for my activities...read the rest here

Wednesday, March 16, 2011

Customer experience reading list

I wrote a "knowledge review" discussing my picks for the essential books on the topic of customer experience that appeared in the Fall 2010 issue of strategy+business, but I forgot to mention it here. So, belatedly, here's the article opening set in my adopted home town, a link to the rest, and the book list:

Greetings from Williamsburg, Va., an outpost on the new frontier called the experience economy. Well, maybe not so new. John D. Rockefeller Jr., the only son of Senior, who was, of course, the founder of Standard Oil and an iconic figure in the rise of the unfettered industrial economy, began buying up this sleepy Tidewater town in the 1920s. Junior’s vision: Create a living museum that would protect the heritage of the United States and transport everyone who paid the price of admission back to the revolutionary 1770s to experience colonial life, right down to the horse manure.

Colonial Williamsburg, the restored capital of England’s Virginia colony, has attracted tens of millions of visitors since then, including long-reigning Queen Elizabeth II, who visited her ancestral fiefdom first in 1957 and again, 50 years later, in 2007. It also spawned an entirely new local economy based on feeding, lodging, and entertaining all those visitors and providing housing and services for people who found jobs there, as well as for former tourists who decided, as I did, that it would be a nice place to live. The entire greater Williamsburg area is a testament to the transformative power of a compelling customer experience...read the rest here

Here are the books covered in the article:
B. Joseph Pine II and James H. Gilmore, The Experience Economy: Work Is Theatre and Every Business a Stage (Harvard Business School Press, 1999)

Bernd H. Schmitt, Experiential Marketing: How to Get Customers to Sense, Feel, Think, Act, and Relate to Your Company and Brands (Free Press, 1999)

Lewis P. Carbone, Clued In: How to Keep Customers Coming Back Again and Again (FT Press, 2004)

Leonard L. Berry and Kent D. Seltman, Management Lessons from Mayo Clinic: Inside One of the World’s Most Admired Service Organizations (McGraw-Hill, 2008)

Lior Arussy, Customer Experience Strategy: The Complete Guide from Innovation to Execution (4i, 2010)

Gosia Glinska, James H. Gilmore, and Marian Chapman Moore, “The Geek Squad Guide to World Domination: A Case for the Experience Economy,” (Darden Business Publishing, 2009), DVD

Jeanne Bliss, Chief Customer Officer: Getting Past Lip Service to Passionate Action
(Jossey-Bass, 2006)

Sunday, March 13, 2011

Management ala Google?

Adam Bryant wrote a good article in today's business section of The New York Times. It appears that Google, which has been promoting people into management based on their technical skills, ended up with a bunch of managers who were lousy at managing people. Go figure!

This situation gave rise to Project Oxygen, which sounds like a pretty exhaustive analytical study of Google employees aimed at discovering how they want their bosses to behave. The findings, as reported in the Times, revealed the following 8 behaviors in priority order:
  1. Be a good coach. Provide specific, constructive feedback, balancing the negative and positive. Have regular one-on-ones, presenting solutions to problems tailored to your employees' specific strengths.

  2. Empower your team and don't micromanage. Balance giving freedom to your employees, while still being available for advice. Make stretch assignments to help the team tackle big problems.

  3. Express interest in team members' success and personal well-being. Get to know your employees as people, with lives outside of work. Make new members of your team feel welcome and help ease their transition.

  4. Don't be a sissy: Be productive and results-oriented. Focus on what employees want the team to achieve and how they can help achieve it. Help the team prioritize work and use seniority to remove roadblocks.

  5. Be a good communicator and listen to your team. Communication is two-way: you both listen and share information. Hold all-hands meetings and be straightforward about the messages and goals of the team. Help the team connect the dots. Encourage open dialogue and listen to the issues and concerns of your employees.

  6. Help your employees with career development.

  7. Have a clear vision and strategy for the team. Even in the midst of turmoil, keep the team focused on goals and strategy. Involve the team in setting and evolving the team's vision and making progress towards it.

  8. Have key technical skills so you can help advise the team. Roll up your sleeves and conduct work side by side with the team, when needed. Understand the specific challenges of the work.

This all seems very basic, although it is worth noting that technical expertise came in dead last. But I wouldn't want to have to parse some of this advice. "Don't be a sissy?" Really? Nevertheless, Google says it bumped up the performance of three-quarters of its managers using these rules. Read the entire article here...

Monday, January 17, 2011

Leadership ala Keith Richards?

I've been reading Keith Richards' memoir, Life (Little Brown, 2010), which is jaw-dropping and hilarious - sometimes by turns, sometimes simultaneously, when I came across a leadership lesson of all things. Keith is talking about how when National Service (mandatory service in the armed forces) was abolished in England in 1960, he suddenly found himself with a couple of years of free time, when out pops this passage:

My life had been plodding along nicely until I found out there was no National Service. There was no way I was going to get out of this goddamn morass, the council estate, the very small horizons. Of course if I'd done it, I'd probably be a general by now. There's no way to stop a primate. If I'm in, I'm in. When they got me in the scouts, I was patrol leader in three months. I clearly like to run guys about. Give me a platoon, I'll do a good job. Give me a company, I'll do even better. Give me a division, and I'll do wonders. I like to motivate guys, and that's what came in handy with the Stones. I'm really good at pulling a bunch of guys together. If I can pull a bunch of useless Rastas into a viable band and also the Winos, a decidedly unruly band of men, I've got something there. It's not a matter of cracking the whip, it's a matter of just sticking around, doing it, so they know you're in there, leading from the front and not from behind.
And to me, it's not a matter of who's number one, it's what works.

Monday, November 29, 2010

5 Steps to Jumpstart Your Productivity

Feel like you're drowning in work? Rosemary Tator of 2beffective LLC and Alesia Latson of the Latson Leadership Group might be able to help. They describe how in More Time for You: A Powerful System to Organize Your Work and Get Things Done (AMACOM). Here's a taste:

When our actions aren’t aligned with our intentions, then a breakdown in our productivity occurs. Here are five steps you can use when you find yourself misaligned and in conflict with yourself such that you are saying one thing and yet doing something altogether different.

Step 1: Notice What You Are Doing Without Judgment
The first sign of being in conflict with what you should be doing is when you feel the “warring.” The warring is a physical sensation in the body. It is an acknowledgment that you aren’t doing what you said you would do. It begins in the pit of your stomach; you feel nervousness and uneasiness. Then it travels to the palms of your hands, which become sweaty. At last, the struggle moves to your face as you furrow your brow.

Then, after the warring comes the thrashing. You tell yourself, “You’re doing it again! What’s wrong with you? How come you can’t do what you say you’re going to do? Look at you. You’ve squandered a half-hour. You could have been done already!”

Be aware of how long it takes you to notice your behavior. It may take forty-five minutes before you realize that the war is raging: “Oh, yeah, that’s right; I’m supposed to notice when I’m avoiding my task.” The next time, your reaction will be faster. The goal is to shorten the time it takes to notice your habit, thinking, or behavior. As soon as you recognize yours, you have a chance to make a choice.

Step 2: Name Your Feeling
Identify the feeling you are having right now. Pick two or three of the following words to describe what you are feeling: angry, sad, scared, glad, happy, overwhelmed, frustrated, put upon, controlled, resentful, unappreciated, unworthy, incompetent, irritated, impatient, lonely, isolated, defeated.

You can have your feelings, but you don’t have to be your feelings. You can have the feeling of being angry, but you don’t have to be angry. You can have the feeling of being unworthy, but you don’t have to be unworthy.

Next, reflect on your feeling in relation to the task you are doing. Does your feeling have anything to do with the task? Now that you know how you are feeling, decide whether you are still committed to completing the task you set out to accomplish. Once you’ve separated your feeling from a task at hand, you can choose again.

Step 3: Breathe
Use a breathing exercise to bring yourself back to balance. One of our favorite yoga exercises is called the Breath of Joy. It is a quick and refreshing breathing exercise that instantly lifts your spirits and clears your mind of negative thoughts and tension. It oxygenates your brain and rejuvenates your body.

The Breath of Joy is three inhalations taken with the arms swinging shoulder height forward and then fully outstretched to the side, over head and finishing with the arms swinging downward with the body in a slight forward crouching position. Inhale one-third of your capacity with each swing of the arms forward, to the side, and up. Then when you drop your arms down as you bend forward at the hips and knees, exhale with a “Ha!”

As you perform the Breath of Joy ensure that you are taking one continuous breath in three parts, rather than three separate breathes. Exhale loudly with a Ha!” (When your arms are swinging downward and you are bending at the hips and knees) allowing tension to escape from the body. Repeat the exercise several times. Remember it is one continuous breath in three parts. Each swing of the arms is to be done vigorously.

Step 4: Know That You Have a Choice
The great thing about having choices is that as long as you are breathing, you have an endless supply of them. They don’t expire or evaporate.

So you might say to yourself, “Oh, look, I noticed that I’m playing this little game with myself again, where I thrash myself for not working. I noticed it, and now I can make other choices.” You might make a choice to continue doing what you’re currently doing, take on the task you were avoiding, or choose something else altogether. By choosing, youare back in control, rather than your habit being in control. It’s not only about reaching your goals; it’s about living the life you create, including playing spider solitaire, if that strikes your fancy.

Step 5: Make a Two-Minute Choice
If you are still not ready to tackle your task, make a choice that you can live with for the next two minutes. Given the tender state that you are in at this moment, it is often best to make an initial choice that expires quickly. The goal of this short-term choice is to create movement that will get you unstuck.

For example, if you’re resisting getting up from watching television to check your e-mail, you may say to yourself, “For two minutes, I’m going to choose to get up, sit at my desk, and answer my e-mail and, after the two minutes, I can stop.” You can even set a timer. By the time the timer goes off or the two minutes have expired, you’ve taken the action to overcome the habit and are back in choice again.

s+b's Best Business Books 2010

As in the past, it was a real pleasure to edit the Best Business Books special section for strategy+business. We had a terrific team of eight expert reviewers, who chose a great list of books. Here's my introduction to the essays and a link to the entire section:

Two years after the financial collapse, the idea of hunkering down and waiting for a return to business as usual — as people did in previous recessions — seems a less and less viable strategy. But what should you do instead?

In this edition of our annual review of the year’s best business books, you will find a reading list that offers intriguing and compelling answers to this question. The list, assembled by a distinguished team of experts, starts with a select guide to the year’s tallest stack: titles that parse the recession of 2007–09 for lessons in preventing another collapse. The reviewer is David Warsh, who covered economics for the Boston Globe for more than two decades and won financial journalism’s Gerald Loeb Award twice.

Next up is Walter Kiechel III’s essay on the best business books on leadership — in a year when the spotlight revealed an unflattering view of too many of our leaders. Kiechel, whose career included stints as the managing editor of Fortune and the editorial director of Harvard Business Publishing, reviews a handful of books that confront “traditional notions of leadership with new circumstances,” including the rise of social networking. (We didn’t cover the topic of strategy this year, but Kiechel’s engaging book The Lords of Strategy: The Secret Intellectual History of the New Corporate World [Harvard Business Press, 2010] is featured in “The Right to Win,” by Cesare Mainardi with Art Kleiner, s+b, Winter 2010.)

The ramifications of technologically enabled societies play a starring role this year in University of Southern California Stevens Institute executive director Krisztina “Z” Holly’s review of the best books on innovation, and a supporting role in journalist Sheridan Prasso’s choices for the best books about China, now the world’s second-largest economy. Both are especially timely as organic growth becomes a top priority at many companies.

In the doing-more-with-less theme, strategy+business contributing editor Sally Helgesen returns with a selection of titles that call into question the “star” system of talent (a factor in the recent recession) and argue for a far more inclusive definition of human capital. In a complement to Helgesen’s essay, neuroscience author Judith E. Glaser examines the year’s best books on the human mind, which offer executives the means to improve their decision making and galvanize their workforce.

David K. Hurst, our longtime Books in Brief reviewer, finds that the Great Recession has not only emphasized the shortcomings of the managerial status quo, but also yielded a number of books that offer alternatives in its art and practice. Finally, University of Denver Daniels College of Business professor James O’Toole returns with his ninth consecutive annual best business books essay, which plumbs biographies and histories on subjects as diverse as Henry Luce and Chinese tea for business lessons that are as relevant as today’s headlines.

In a time of halting recovery, frugal consumers, tight money, and increasing government activism, companies urgently need winning strategies. For executives charged with creating and executing those strategies, this year’s best business books are a valuable source of insight and inspiration...read the essays here>

Sunday, June 20, 2010

Six Guidelines for Resolving Intergenerational Conflict

Publicist Cathy Lewis sent along this advice on managing multiple generations in the workplace. It's by Larry and Meagan Johnson of the father-daughter team behind Johnson Training Group, whose clients include American Express, Harley-Davidson, Nordstrom, etc., and its drawn from their new book, Generations, Inc.: From Boomers to Linksters--Managing the Friction Between Generations at Work (Amacom, 2010):

For the first time in history, there are five generations working side by side: the Traditional Generation (born pre-1945), Baby Boomers (born 1946-1964), generation X (born 1965-1980), Generation Y (1981-1995), and the Linkster Generation (born after 1995). Since conflicts often arise in a multigenerational environment, it's helpful to have some understanding of the differences between employees of distinct generations.

Each generation has been influenced by the major historical events, social trends, and cultural phenomena of their time, shaping their ideas about everything from expectations and perceptions about what the working environment will provide and how they should behave as employees, to company loyalty and work ethic.

Here are some guidelines for resolving intergenerational conflict:

1. Look at the generational factor. Is this conflict generational, or is there something else going on? For example, Traditionals and Baby Boomers don't like to be micromanaged, while Gen Yers and Linksters crave specific, detailed instructions about how to do things and are used to hovering authorities. There is almost always a generational component to conflict; recognizing this offers new ways to resolve it.

2. Consider the generational values at stake. Each generation is protecting a distinct set of values, and conflict may threaten these values. For example, Baby Boomers value teamwork, cooperation, and buy-in, while Gen Xers prefer to make a unilateral decision and move on--preferably solo.

3. Air different generations' perceptions. When employees of two or more generations are involved in a workplace conflict, they can learn a great deal by sharing their perceptions. For instance, a Traditional may find a Gen Yer's lack of formality and manners offensive, while a Gen Yer may feel dissed when this older employee fails to respect her opinions and input. Have each party use "I" statements to avoid potentially negative confrontations.

4. Find a generationally appropriate fix. You can't change people's life experience. But you can work with the set of workplace attitudes and expectations that come from it. So, for instance, if you have a knowledgeable Boomer who is frustrated by a Gen Yer's lack of experience coupled with his sense of entitlement, turn the Boomer into a mentor. Or you may have a Gen Xer who is slacking off and phoning it in. Instead of punishing him, give him a challenging assignment, the fulfillment of which is linked to a tangible reward.

5. Find commonality and complements. When we study generations, some common and complementary characteristics emerge--and these can be exploited when dealing with conflict between them. For instance, Traditionals and Generation Y employees both tend to value security and stability. Traditionals and Boomers tend to resist change--but both crave training and development. Gen X and Gen Y employees place a high value on workplace flexibility and work-life balance. Boomers and Linksters are most comfortable with diversity and alternative lifestyles. Gen Y and Linksters are technologically adept and committed to socially responsible policies.

6. Learn from each other. Each generation has valuable lessons to teach the next. For example, Traditionals and Boomers have a wealth of knowledge and tricks of the trade that younger workers need. Generation X employees are widely known for their fairness and mediation abilities. Generation Y workers are technology wizards. And Linksters hold clues to future workplace, marketing, and business trends.

Sunday, April 18, 2010

On the annual report

How well does your company’s annual report communicate and reinforce leadership intent and corporate values?

A good way to start answering this question is to read Milt Moskowitz's great analysis of Novartis's 2009 annual report for strategy+business. Moskowitz, who's on Business and Society Review's editorial board and co-developed Fortune’s “100 Best Companies to Work For” survey, starts like this:

The corporate annual report, a widely ignored document, could do with a makeover. It is generally devoid of transparency, candor, and life. Most companies seem to regard it as a chore. In recent years, these reports have been reduced in size. Many companies now greet shareholders with a bland statement placed in front of the 10-K report they file with the Securities and Exchange Commission. Talk about tough reading.

If you want to see just how big a missed opportunity this is, take a look at the annual reports of the Swiss pharmaceutical giant Novartis AG. The company sets a new standard for delivery of information in clear, nuanced, and felicitous prose...read the rest here.

Saturday, April 3, 2010

Business ethics reader

I was pleased to see an article of mine included in Annual Editions: Business Ethics 10/11 (McGraw-Hill) edited by John Richardson at Pepperdine.


The article, "An Ethical Dilemma," was published in Selling Power in 2004. It uses the TAP Pharmaceutical case, in which the company paid an $875 million fine to the government, to illustrate the dangers of unethical and illegal sales practices. It goes on to describe how to build ethical integrity into the sales function in four ways, by:
  • Specifying boundaries that are supported by corporate values and policies;
  • Including ethics as a consideration in hiring decisions and training curriculum;
  • Building ethics into selling and compensation systems;
  • Enlisting unwavering managerial support in terms of compliance and enforcement.

The reader is part of McGraw's Annual Editions series, which publish selected articles from periodicals in topical collections and sell them for use in college courses. I wonder if I'll be getting a little payback for all the boring reading I had to do as a student.

Monday, March 8, 2010

Killer Quotes #1





"No man but a blockhead ever wrote, except for money."



- Samuel Johnson, quoted in Boswell's Life of Johnson

Tuesday, February 23, 2010

One question: Stephen H. Greer

I don't usually bother with entrepreneur's stories, unless they happen to include the creation of a major company. But Stephen Greer's Starting from Scrap: An Entrepreneurial Success Story coming in March from Burford Books proved to be a compulsive read.


Greer's improbable tale starts with him arriving in Hong Kong in Feburary 1993 at age 24 with a few thousand bucks, no job, not speaking Chinese, and no tangible prospects...other than the idea of getting rich in Asia's economic boom. And he does!

This kid from Pittsburgh ends up building a $250 million international scrap recycling business over the next 14 years. What happens in between is a story that every wannabe entrepreneur should read: first, because it vividly describes the highs, the lows, and the personal costs of starting your own business; and second, because anyone who has ever started a business on a bootstring will tell you it rings true.

My question for Stephen: Looking back, what personal trait turned out to be most important to your success? Here's his answer:

I would say persistence. What I uncovered in my pursuit of success as an entrepreneur is that most things do not come easily and that even if all the logic stacks up behind an idea, it is sweat, persistence, and determination that make it happen.

Along the way, I often wondered if I was going to make it and felt frustrated, if not cheated, that I was not achieving the planned results. Sometimes the problems were beyond my control: employee fraud, interference from corrupt government officials, even Mother Nature. It seemed the harder I swam, the more strongly the current pulled against me. But I truly felt I was doing the right things at the right time in the right place and believed that if I could just overcome the current hurdle, it would be smooth sailing going forward. Of course it was not, but that belief gave me the strength to stay in the battle.

My hunch turned out to be correct and I was generously rewarded when our plans started to achieve success. Ultimately, a large publicly-listed company recognized the value that our hard work had created and bought us out at an attractive valuation. But I think many people would have quit before achieving that successful end result because of the pain that had to be endured to get there.

Of course, my advice to up-and-coming entrepreneurs is to strenuously challenge and test the logic behind your idea. But if you still find merit in your plans after that and believe the market will value what you are doing, be tenacious and persistent in the pursuit of your plans and goals.

Tuesday, February 9, 2010

ITWeb discovers Ayn Rand and Business

It's always exciting to find a book you've written getting attention in the press. In this case, it's Ayn Rand and Business and the press is Mandy de Waal, a columnist on South Africa's ITWeb. Here's what she wrote:

Born 105 years ago, Ayn Rand...is experiencing a major revival. The Washington Post declared Randoids 'in' for 2010; Hollywood is remaking her movies; and Rand book sales are brisk. Yaron Brook, president of the Ayn Rand Institute, says sales of Atlas Shrugged are “going through the roof”. Rand's magnum opus made it into Amazon.com's top 50, selling more than 500,000 copies in 2009.

“The explosion in sales of Atlas Shrugged more than a half century after its initial publication is truly remarkable,” says Brook. “People are discovering the prescience of Ayn Rand's writing. They're seeing the policies of Atlas Shrugged villains Wesley Mouch and Cuffy Meigs acted out by our government officials today. They're looking for answers on how to stop government intrusion in our lives. Atlas Shrugged provides those answers, and many more.”

Rand's thoughts have never been more relevant given the global market collapse, followed by government rescue plans and other attempts at controlling markets. Laissez-faire capitalism was always Rand's ideal political-economic system. “It is a system where men deal with one another, not as victims and executioners, nor as masters and slaves, but as traders, by free, voluntary exchange to mutual benefit,” said Rand. “It is a system where no man may obtain any values from others by resorting to physical force, and no man may initiate the use of physical force against others. The government acts only as a policeman that protects man's rights; it uses physical force only in retaliation and only against those who initiate its use, such as criminals or foreign invaders. In a system of full capitalism, there should be (but, historically, has not yet been) a complete separation of state and economics, in the same way and for the same reasons as the separation of state and church.”

Rand's personal journey was nothing short of astonishing, and saw her transform from a shopkeeper's daughter in communist Russia to one of the world's leading proponents of laissez-faire capitalism. In their book Ayn Rand and Business, Donna Greiner and Theodore Kinni interpret the fiction and philosophy of this staunch and radical champion for capitalism. Not only do Greiner and Kinni clearly explain the fundamentals of Objectivism, they describe how business leaders can integrate these philosophies into their personal lives and industry. Written in the spirit of Rand's own perspective, this business book is anchored in practicality, well organised and goal-oriented...read the rest here

Friday, January 15, 2010

Attention CPG marketers

These days, there is a lot of interest in shopper marketing -- that is, marketing aimed at influencing consumers as they are actually in the process of selecting and buying products, whether they are making a shopping list at home or downloading coupons or standing at the shelf. CPG companies are investing a ton of money in it. For example, P&G says it spends over $500 million annually on shopper marketing.

There are good reasons for this. Shopper marketing is a great way to engage consumers all along the path to purchase. It can be used to create more collaborative and successful trade relationships. And, it can drive sales -- no small feat in recessionary times.

But there is also a lot of confusion around shopper marketing. Few companies have figured out how to align it with the rest of their marketing processes and spend. And no one has really figured out how to measure its effectiveness -- either as a standalone investment or in relation to other spending.

I got a great education in all of these issues a couple of months ago, when I worked with Booz & Company partners Matt Egol and Ed Landry to write up the findings of a major shopper marketing study which they co-led with the Grocery Manufacturers Association and SheSpeaks.com, a leading online consumer community. Whether you are looking for a primer on the subject or some cutting edge insights, it's worth a read. You can download it for free here...

Tuesday, December 29, 2009

How to make a multi-billion dollar market

Aside from its implications regarding how drug companies manipulate doctors and consumers, Alix Spiegel's terrific story titled "How A Bone Disease Grew To Fit The Prescription" on NPR a few days ago should be required reading in any company that is trying to pioneer a new market.


Spiegel examines how Merck, with the help of a consultant named Jeremy Allen, transformed a new osteoporosis drug named Fosamax into a $3 billion/year blockbuster. Fosamax, it turns out, was a drug without a major market. When Merck launched the drug, osteoporosis was being treated, but it wasn't being prevented -- and that needed to be changed in order to create a really big market for Fosamax. You can learn how Merck accomplished this feat by reading the transcript of the story here.

Friday, November 27, 2009

s+b's Best Business Books 2009

Editing this year's Best Business Books special section for strategy+business was a terrific experience. We had an insightful and articulate team of essayists who winnowed through the stacks, and Guy Billout's illustrations are great. Here's my intro:

No matter what the future holds, the Great Recession of 2008–09 has had a seismic impact on the global business landscape and has called into question its philosophical and systemic foundations.

Certainly, it has been keenly felt among publishers and booksellers. In May 2009, year-to-date sales of professional books in the U.S. were down 6.8 percent from the year before, according to the Association of American Publishers. The recession also colors the writing — and the reading — of this year’s s+b best business books essays in ways both obvious and subtle.

The most direct manifestation is evident in the appraisal by Financial Times commentator Clive Crook of the books that seek to make sense of the recession, its implications, and its ramifications. In barely more than a year, the business section has become crowded with such books, but with the story still unfolding, none of them yet are comprehensive. Crook’s picks provide the multiple levels of perspective needed to appreciate the recession’s many facets.

Ayesha Khanna, managing director of Hybrid Realities, and Parag Khanna, New America Foundation senior research fellow, team up to review books on the changing topology of global business. They find changes in regional trading patterns and increasingly dynamic emerging economies that will challenge any established player — all evidence of an ongoing shift in competitive power that is sure to accelerate if the U.S. economy remains stagnant.

As one might expect, our management and leadership essays are rife with recession links. In the former, Judith F. Samuelson, the founder and executive director of the Aspen Institute’s Business and Society Program, searches out books that reveal the recession’s silver lining: its challenges to outmoded ways of thinking about management and governance. In the leadership essay, Charles Handy, whose memoir was one of 2008’s Top Shelf selections, mines books on topics as diverse as America’s Puritan settlers and the Buddhist Tzu Chi movement for insights into how to begin mending the torn fabric of leadership.

The University of Denver’s Daniels College of Business professor James O’Toole grounds his review of this year’s best biographies in a hefty tome about a 19th-century prime mover, John Stuart Mill, whose advocacy of free markets and private ownership resonates amid the dramatic government response to this economic crisis. IMD professor Phil Rosenzweig returns for an encore performance in the strategy category, pointing us toward books on intellectual property and dynamic capabilities in an effort to identify enduring strategic advantage. Rosenzweig also recommends a new book on Enron that takes us back to the last recession and explores the perils of stretching any strategy too far.

Marketing maven Catharine P. Taylor is back as well, with a proposition that should raise executive eyebrows: Branding is becoming an open source endeavor. She calls out Twitter — the subject of almost as many new books as the recession — as one of the leading technological mechanisms enabling this phenomenon. Steven Levy, senior writer at Wired and newcomer to our pages, broadens the thesis by reviewing books that explore the disruptive power of technology and what happens when companies such as MySpace don’t heed that power.

This year’s best business books help us understand current conditions and chart a secure course forward. With luck, next year’s best books will offer similar insight into a recovery of historic proportions.

Saturday, November 7, 2009

Interview: Dick Grote on Employee Discipline

“You can’t punish people into commitment,” says Dick Grote, who first implemented a non-punitive employee discipline system as Frito-Lay’s Director of Training and Development in the 1970s. He is the author of Discipline Without Punishment: The Proven Strategy That Turns Problem Employees into Superior Performers (Amacom) and president of Addison, Texas-based Grote Consulting Corporation.

Why is disciplining employees such a tough job for managers?
This is a difficult thing to do, to sit down with another person and talk about the fact that they are not doing a good job. And when you have to keep on working with that person, the stakes go up. The other thing is all of the concern today about discrimination suits and legal liability. Supervisors are typically scared to death that if they say anything to anybody, then they are going to be facing Johnnie Cochran.

What are the most common mistakes managers make with regard to discipline?
Too often managers think that the purpose of disciplinary action is to terminate the employee in a way that can survive a legal challenge. That point of view is way too limited. I think there are four objectives for any discipline process. The first objective, obviously, is to solve the problem. The second objective is to maintain and enhance the relationship. The third is to build personal responsibility. The fourth is to build compelling defensibility.

You say that termination represents the failure of a discipline system. Why?
What we need to recognize is that the purpose of discipline is to bring about change. Suzie is coming to work late. So we give Suzie a first warning. But Suzie doesn’t change and so we move to a second step. She keeps coming to work late. So we move to a final step and Suzie keeps coming into work late. At that point we realize that our goal of bringing about change has failed and now it’s time for Suzie to find a job where they don’t care about punctuality. That is why termination is a failure of the process.

How does a Discipline Without Punishment (DWP) process work?
The first formal step is Reminder One, a serious conversation that puts the employee formally on notice that change is required. If that doesn’t do the trick, you go to Reminder Two. Another serious conversation, this time formally documented in a memo to the employee. If that still doesn’t work, you move to Decision Making Leave, a one-day, paid suspension where the employee is required to make a final decision either to change or quit. Now, one of two things usually happens: either they change or they don’t and another problem comes up which makes termination very easy.

The point of DWP is that we are eliminating the warnings, the reprimands, and the unpaid suspensions. We are replacing it with something much tougher, the demand that people take responsibility for their own behavior. That puts all the responsibility on the employees’ shoulders and that is where it belongs.

Can a manager use the principles of DWP without organizational support?
Absolutely. I think the first thing is the recognition that you are really trying to bring about a change. Learn how to hold a good performance improvement discussion and gain an agreement to change.

There is another thing. When you are documenting disciplinary action, you are documenting the discussion about the problem. That is why you can only do it after you have had the conversation. The effective way is to talk first, write later.

Grote’s Recommended Reads

A Message to Garcia by Elbert Hubbard. “As far as a general understanding of individual responsibility, there is nothing better.”

Coaching for Improved Work Performance by Ferdinand Fournies. “Very good at providing step-by-step instructions and vivid examples of coaching situations.”

Analyzing Performance Problems: Or, You Really Oughta Wanna--How to Figure out Why People Aren't Doing What They Should Be, and What to do About It by Robert Mager. “Shows that the solutions to a lot of people problems come by providing feedback, arranging appropriate consequences and getting rid of obstacles that prevent people from doing the job right.”

Sunday, September 27, 2009

Bread or bullets: MacArthur in Japan

Jed Graham of Investor's Business Daily called last week to do a short interview about General Douglas MacArthur's role in the post-WWII reconstruction of Japan - a topic that Donna and I wrote about in our book, No Substitute for Victory: Lessons in Strategy and Leadership from General Douglas MacArthur (FT/Prentice Hall, 2005). Jed did a great job on the article. Here it is:

Gen. Douglas MacArthur Rose To Put Japan On Its Lofty Path by Jed Graham, Investor's Business Daily, posted 09/25/2009 07:22 PM ET

Three days before he accepted Japan's surrender on the battleship Missouri in Tokyo Bay, Gen. Douglas MacArthur landed at the Atsugi naval air station without big guns to intimidate a still-armed enemy.

Convinced the Japanese would honor the surrender and determined to set the right tone for the American occupation, MacArthur ignored the warnings of his fearful staff that he would be an easy target.

"While conventional wisdom might suggest that the United States enter Japan in force and prepared for treachery, MacArthur felt that peace could be attained more rapidly by a show of confidence," Harry Maihafer wrote in "Brave Decisions: Profiles in Courage and Character from American Military History."

Winston Churchill would later call MacArthur's landing "accompanied by only a small force of troops, and in the face of several million Japanese soldiers who had not yet been disarmed" the most impressive feat by any commander in the war.

MacArthur's strategic gambit reflected a grasp of the challenge he would face as supreme commander of Allied powers (SCAP) in Japan from 1945 to 1951. He knew that occupations rarely went smoothly. Centralized command threatened the people's self-governance and self-confidence.

Uplifting Aim
Upon his arrival after the surrender, the Army five-star assured the Japanese that his top concern was "not how to keep Japan down, but how to get her on her feet again."

And because the locals quickly accepted his word, his direction of the occupation stands out as an unparalleled success.

In a few short years, MacArthur (1880-1964) made changes that would transform Japan from a militaristic society facing economic devastation into a thriving democracy whose nonaggressive posture remains enshrined in its constitution.

MacArthur jumped into action. Contradicting Washington's post-surrender directive to avoid involvement in Japan's economic rehabilitation, he moved fast to ameliorate a rising food crisis.

"One of the first things I did was to set up our Army kitchens to help feed the people," he wrote in "Reminiscences." "Had this not been done, they would have died by the thousands."

His finger firmly on Japan's pulse, MacArthur forbade his forces to eat local food and had 3.5 million tons of Army food supplies in the Pacific moved to the island nation.

"The effect was instantaneous," he wrote. "The Japanese authorities changed their attitude from one of correct politeness to one of open trust," and a once-dubious press voiced "unanimous praise."

MacArthur's tactical moves furthered his strategic goals.

When Congress demanded that MacArthur justify the expense of shifting food to Japan, he said an occupation's goal must be extending victory, not presiding over defeat.

"Starvation breeds mass unrest, disorder and violence," he cabled Washington. Give me bread or give me bullets."

MacArthur understood that the most effective way to maximize his influence was by aligning the interest of potential rivals with his goals.

Unlike the occupation of Germany — divided between Western and Soviet zones of authority — MacArthur had the advantage of presiding over a unified Japan. But that wasn't initially an assured outcome.

When Gen. Kuzma Derevyanko, head of the Soviet mission, insisted that his forces occupy the northern Japanese island of Hokkaido, MacArthur made it personal.

"If a single Soviet soldier enters Japan without my authority, I shall at once throw the entire Russian mission into jail, beginning with you, General," he threatened.

As 1945 drew to a close, MacArthur faced another threat to his sway over the occupation. Pressure from Allies who wanted a say in policy toward Japan culminated in the Moscow Agreement that gave the major powers a veto over directives involving constitutional structure.

At the crux was how to handle Japan's imperial institution. While MacArthur believed that the institution must be reformed and demythologized, the Allies were bent on trying Hirohito as a war criminal.

Going after the emperor, MacArthur believed, would cut to the heart of his strategic approach and fuel a rebellion. He warned Washington that 1 million troops would be needed, not the current 350,000.

Determined to head off a disaster in the making, MacArthur lit a fire under his occupation staffers.

His orders: Draft a Japanese Constitution in six days.

Why the haste? He had to strike before the newly empowered Far East Commission had time to organize and issue demands.

MacArthur outlined key principles for the constitution:
• The emperor would remain head of state, but his duties would be governed by the constitution and be responsive to the will of the people.
• Japan would renounce war as a sovereign right of the nation.
• The budget should be patterned after Britain's system.

Nine days later, Maj. Gen. Courtney Whitney presented to Japan's Cabinet members the document that provided essential freedoms to the Japanese and rendered the emperor "practically unassailable."

Whitney, a tough lawyer, didn't bother with a soft sell. He argued that embracing the American draft was the Cabinet's "only hope of (political) survival," because MacArthur would otherwise publish it and give the Japanese people a choice.

While going public would have sparked a backlash from the Allies, the Cabinet members didn't test whether MacArthur was bluffing. They acquiesced, and the Japanese Constitution that took effect in 1947 with slight revisions has gone six decades without amendment.

In an essay in "MacArthur and the American Century: A Reader," Japanese historian Ikuhiko Hata wrote that radical Japanese military officers organized an underground movement to resist the occupation through guerrilla war once the emperor system was outlawed. With MacArthur keeping Hirohito in place, "they
abandoned the project within a year," Hata wrote.

MacArthur's success depended not only on realpolitik, but also high ideals. The Japanese people "really were impressed with a man who was a man of war, who comes in and says ... 'You must become a nation of peace. This is how you can become a beacon in the world. You can become the Switzerland of Asia,'" John Dower, author of "Embracing Defeat: Japan in the Wake of World War II," told
C-SPAN.

Among MacArthur's earliest initiatives was directing Japan's leaders to enact women's suffrage, freedom of speech, unionization and the release of political prisoners.

MacArthur offered "a higher vision of the nation and what it could achieve that gave the Japanese something to rally around," said Theodore Kinni, co-author of "No Substitute for Victory: Lessons in Strategy and Leadership From General Douglas MacArthur."

At the same time, "he had a very practical approach to getting these things done," Kinni told IBD. "There was always this kind of back and forth."

When newly empowered unions threatened a national strike in 1947, MacArthur prohibited it. When Japanese leaders showed little inclination to reform their constitution, he gave them a shove.

Understanding the limits of his power to change Japan, MacArthur pushed through — but did not order — changes in a way that "reinforced the Japanese government's legitimacy (in) a masterful performance," Lt. Col. David Cavaleri wrote in "Easier Said Than Done: Making the Transition Between Combat Operations and Stability Operations."

Getting Buy-In
Wrote MacArthur: "Nothing that was good in the new Japanese government was going to be done because I imposed it."

He instructed his staff to "scrupulously avoid interference with Japanese acts merely in search for a degree of perfection we may not even enjoy in our own country."

He turned the odds in his favor by giving Japan's citizens a clear stake in the nation's — and the occupation's — success.

One reform MacArthur proposed was to democratize farmland ownership. He required absentee landlords to sell, with the government making the land available at a fixed price with low, long-term interest rates.

"Land reform is seen as the single most important factor for quelling rural discontent and promoting political stability in the early postwar period," James Dobbins wrote in "America's Role in Nation-Building: From Germany to Iraq."

MacArthur's Keys
As Allied commander in Japan from 1945 to 1951, he engineered the country's turnaround from a battered militaristic society into a thriving democracy.

"There is no security on this earth; there is only opportunity."

Saturday, September 26, 2009

Derailing healthcare reform

It seems crystal clear that a country that ranks first in healthcare costs and 37th in overall health system performance urgently needs healthcare reform. But based on the spam I've been getting, it's also pretty clear that the so-called debate over reform is setting new lows for public discourse. Death panels? Gimme a break!

The campaign against healthcare reform reminds me of this quote from Richard White's biography of Huey Long, Kingfish: The Reign of Huey P. Long(Random House, 2006):

In order to succeed, a mass movement must be superficial for quick appeal, fundamental for permanence, dogmatic for certainty, and practical for workability.
That seems to define the movement to derail reform in a nutshell and I can't help but believe that it is being orchestrated and financed by commercial interests. Follow the money, right?

By the way, Long's biographer found the quote in a 1935 Saturday Evening Post article published shortly after Long's assassination. It was spoken by a guy named Gerald L.K. Smith, a preacher who had a hankering for political power. He helped Long organize the Share Our Wealth Society, a scheme to take from the rich and give to the poor that Long cooked up during the Great Depression, which Smith tried to take over after Long was killed. Smith was a pro-Nazi white supremacist and a virulent anti-Semite who opposed labor unions. Unfortunately, like insurance companies and healthcare providers, he also knew how to get other people to do his bidding.

Sunday, August 16, 2009

The company town

Having read Douglas Brinkley's centennial history of The Ford Motor Company, Wheels for the World: Henry Ford, His Company, and a Century of Progress, as well as several earlier books on Henry Ford and his company, it was great to find a new book that covers a chapter in the story that came as a complete surprise. Greg Grandin's Fordlandia: The Rise and Fall of Henry Ford's Forgotten Jungle City (Metropolitan Books) is the fascinating story of an ill-fated business venture that Henry Ford undertook in the 1920s.

Ever the vertical integrator and never one to brook a monopoly (if it might cost him money), Ford created Fordlandia in an attempt to bypass European control of the rubber market and secure a low-cost source of crude rubber. First, he bought a 2.5 million acre tract of jungle (about twice the size of Delaware) located 600 miles deep in the Brazilian Amazon. Then, he decreed that a rubber plantation and a Midwestern-style town be constructed on the site, which was, Grandin reports, "18 hours on a slow riverboat" from the nearest city. You can guess the hilarity that ensued by the fact that the company simply abandoned the venture two decades later.

The most head-shaking part of the story is the supreme confidence and cultural arrogance that was common among the business moguls and large companies of the early 20th century. Fordlandia was not Henry Ford's first attempt at building communities around his businesses; he founded towns in Michigan's Upper Peninsula and in 1922, tried to convince the U.S. government to give him Muscle Shoals, Alabama so he could build the "Detroit of the South." Milton Hershey, who built the town of Hershey, Pennsylvania around his chocolate factory, built a sugar mill town in Cuba. And Grandin reports that in the 1920s:


"....one could tour Guatemala, Costa Rica, Panama, Honduras, Cuba, and Columbia and not for moment leave United Fruit Company property, traveling on its trains and ships, passing through its ports, staying in its many towns, with their tree-lined streets and modern amenities, in a company hotel or guest house, playing golf on its links, taking in a Hollywood movie in one of its theaters, and being tended to in its hospital if sick."
These men did not simply see their companies as an integral part of society; for better - and often, as Fordlandia reveals, for worse - they saw themselves as society builders.

Sunday, August 2, 2009

Speaking of pirates

The movie studios complain bitterly about piracy, but it's hard to sympathize with them when you read a story like this one from Bloomberg:

J.R.R. Tolkien sold movie rights to his “Lord of the Rings” novels 40 years ago for 7.5 percent of future receipts. Three films and $6 billion later, his heirs say they haven’t seen a dime from Time Warner Inc...read the rest here
Tolkien's heirs are suing Time Warner for $220 million and I hope they get it all plus double or treble damages. But I'll give Harlan Ellison, one of the great sci-fi writers who worked in Hollywood for many years, the last word on this kind of piracy. Ellison is the subject of an entertaining documentary titled Dreams with Sharp Teeth that every writer should see. In it, he tells this story, which lo and behold was posted on You Tube.