Saturday, 26 February 2011

World domination

Transnational organisations are commonplace. Many top brands have a global presence.

How do they cope with the variety of custom and practice in all of the different countries in which they operate?

Some American companies have had a tendency to attempt the Genghis Khan model of expansion. By this I mean that they tended to believe that Truth, Justice and the American Way are best and easily transplanted to every country of the world.

I've worked with American companies that started to stray from that model when the CEO was recruited from another English speaking country and not the United States. A relaxation of viewpoint gradually led to a dawning realisation that indigenous leaders might do better running the business in each country.

What followed was a tussle between aspects of the business that needed to be consistent across the world and those that could be adapted to fit the customs and culture of the local environment. Some found that management information systems could be homogenised and that some product development, brand management, marketing and sales needed to be adapted to the local market.

Why set yourself up for a fight that you will surely lose? Think about what you need to unify and run an efficient business and where boundaries can be relaxed for greater effectiveness.

This is one of my favourite examples of innovation in altruism led by Dr Sugata Mitra. I heard Hole-in-the-wall discussed on Radio 4 in the UK and a senior manager of Microsoft insisting that the only way to spread education to rural areas of India was to build schools and recruit more teachers.

I prefer to defer to local knowledge of IT specialists and educationalists in India.

Dr Mitra concludes with 4 points:

- Remoteness affects the quality of education
- Education technology should be introduced into remote areas first
- Values are acquired: doctrine & dogma are imposed
- Learning is a self-organising system

He proposes that education should develop its own technology specs to tackle remoteness, values and violence.

He calls his system: Outdoctrination.

Talking to Martians

When I first started as an independent consultant I loathed simplistic generalisations about customers used by my clients. They didn't seem to relate to human beings and complexity, nor my experience as a customer for their services.

George Kelly, founder of Personal Construct Psychology, argued for reflexivity - a process of stepping into other people's shoes and considering the other side of the equation. In his case it referred to clients. In NLP we talk about perceptual positions: first (me), second (you), third (external person), meta (helicopter position) to view and experience all the angles.

One of the changes in fostering change and innovation is the people factor. How do I interest other people and ignite enthusiasm for the proposition?

Firstly it's useful to consider our own reluctance and resistance to change and what we need to encourage us to shift. That isn't enough, as generalising out from one specific to a group is as dangerous as viewing them as 'Other' or 'Martians' who are alien to us.

Secondly it's useful to answer the 'What's in it for me?' question that people think consciously or unconsciously. Their motivation may be different from ours, so research and discussion helps illuminate this area.

Thirdly we can show respect for what matters to particular groups.

Brian Malow illustrates this point well:

He also illustrates how an 'enemy' group can unite people who seem not to work together:

Clash of values

Pinchot's 10 commandments for intrapreneurs stirs mixed feelings in people. Firstly we may read the same words but understand them very differently. Individual style may play a part in how much we're preapred to risk. National culture may also have an effect on how we respond. Gender can also have an impact.


1 Come to work each day willing to be fired.
2 Circumvent any orders aimed at stopping your dream.
3 Do any job needed to make your project work, regardless of
your job description.
4 Find people to help you.
5 Follow your intuition about the people you choose, and work
only with the best.
6 Work underground as long as you can – publicity triggers the
corporate immune system.
7 Never bet on a race unless you are running in it.
8 Remember it is easier to ask for forgiveness than for permission.
9 Be true to your goals, but be realistic about the ways to achieve
10 Honour your sponsors.

Part of my work is as a psychotherapist and counsellor. In domestic violence cases some women may believe that they must be totally honest with a partner, even if that person lies through their teeth and is abusive. Commandment 6 may be anathema to these clients, as they don't wish to copy the behaviour that they criticise in their partner. Part of my role is to enable people to shift from absolute to relative values in certain circumstances. If children may lose their mother because absolute honesty triggers a partner to kill, then perhaps withholding information temporarily may be the lesser of 2 evils.

Similarly someone who finds it difficult to control aggression may wish to remove this behaviour completely. I argue that, if a crazed axe murderer climbed through the window one night, it may be very useful to have high level aggression in combatting an attack on the partner and children.

Here are some questions that may help think this through:

How do I make sense of this commandment?
How do I adapt it to fit my situation and personal style?
How long can I sustain this behaviour?
If it conflicts with my personal values, how might it fulfill a higher value for me?

Back seat driving

A businessman based in the UK, brokering trade between his home country and a neighbour, found that the 2 countries were at war with each other so that his business was in a precarious position. He wasn't a politician and had no power to influence the 2 leaders directly. He worked behind the scenes to influence relations between the 2 countries by the back door.

Georgians live life through song. Italians may accompany each other to the beach or walk in groups, but if a Georgian begins to sing then others join in. The Georgian Orthodox Church has a powerful influence on the community and its current head, Patriarch Illia ii, has been active in promoting peace in the country. As a symbol of this move, he asked members of his choir to stop wearing the ceremonial dagger with their choka (traditional Eastern costume) telling them 'There has been enough war in Georgia.'

The Georgian businessman sponsored Basiani, part of the Patriarch's choir, to come to the UK in 2009 to give a concert at the Russian Orthodox Cathedral in London and then sing with the resident choir for the evening mass. This was a momentous event and coincided with a tour of icons of English women martyred in Russia during the Revolution, who are now regarded as Russian saints.

This year the businessman was involved in another visit by the Patriarch along with Basiani and senior Georgian clergy, to inaugurate a Georgian Orthodox church in London. A concert at St John's Smith Square was also attended by the head of the Russian Orthodox Church in the UK.

Here's Georgian pop star Keti Melua with Basiani singing for the senior clergy and others:

If you can't find a direct way in, go round the back.

Friday, 25 February 2011

The Steve Jobs tango

Steve Jobs has an interesting attitude to the customer. He listens, but doesn't run after them. Lack of imagination may limit what they want. If he can suggest something they haven't thought of yet, they might go for it.

Customer pull is clearly important to Apple and Steve Jobs has thought about different types of customer, since he and Steve Wozniak first put together Apple 1 and 2 (the first for fellow computer geeks who could assemble their own hardware, the second for those who wanted the product, but needed the box, screen and keyboard to make it work.)

Technology push is not allowed to dominate Apple's output. Designers could add unlimited functionality to products, but these won't sell unless the price is affordable. Technology is no good floating around with a mass of disconnected ideas. There must be a gravitational force that pulls it together in the form of saleable products.

Jobs is well aware of unarticulated and potential customer needs, so that he doesn't fall into the trap of looking for a quick assessment of articulated and identified needs. Latent needs may be awakened through careful engagement with customers.

'You have to merge these points of view, and you have to do it in an interactive way over a period of time -- which doesn't mean a week. It takes a long time to pull out of customers what they really want, and it takes a long time to pull out of technology what it can really give.'

Steve Jobs has little interest in describing himself as Superman, the charismatic leader. The team is essential to the process. Ideas may come from anyone and the team helps weed out the rubbish and refine those that are worth pursuing. Sharing ideas helps develop them and this gives the company leverage.

'Let's say that -- for the same amount of money it takes to build the most powerful computer in the world -- you could make 1,000 computers with one-thousandth the power and put them in the hands of 1,000 creative people. You'll get more out of doing that than out of having one person use the most powerful computer in the world. Because people are inherently creative. They will use tools in ways the toolmakers never thought possible. And once a person figures out how to do something with that tool, he or she can share it with the other 999.'

Jobs defines his role as Head Janitor and he clearly steps in to take up the slack when senior colleagues leave. He has fostered a company culture that promotes excellence, but hasn't achieved it by training courses and company handbooks. He focussed on the aesthetics of the product, but also the components and how the factory was laid out.

'I mean, beyond the functional benefits, the aesthetic communicates something about how they think of themselves, their sense of discipline in engineering, how they run their company, stuff like that......(Steve Wozniak and I) We thought, why don't we take the extra few days or weeks and do it right? We had a fundamental belief that doing it right the first time was going to be easier than having to go back and fix it. And I cannot say strongly enough that the repercussions of that attitude are staggering. I've seen them again and again throughout my business life. They're just staggering.'

Steve Jobs describes the culture of excellence or right first time as something that is inherently motivating for people, rather than imposed and policed:

'In my experience, people get far more excited about doing something as well as it can be done than about doing something adequately. If they are working in an environment where excellence is expected, then they will do excellent work without anything but self-motivation. I'm talking about an environment in which excellence is noticed and respected and is in the culture. If you have that, you don't have to tell people to do excellent work. They understand it from their surroundings. You may have to coach them at first, but then you just get out of their way, and they'll surprise you time and time again.'

Jobs recognises the importance of selecting the right people to run parts of the business. He describes how he transmitted his notion of attention to detail and components that symbolise a wholistic process. This enabled staff to move beyond the idea of silos and islands of production to thinking about production as an organic system that must be managed as a whole.

'People in our factory asked me, "Why is it so important to paint these machines the same color? We don't understand it." For one thing, we want the place to look nice because we bring customers through. They're going to make a decision on using NeXT products, and they ought to know that we have a very high-quality manufacturing operation. But the real reason is that we don't want people to think of the factory as separate islands of automation. We want people thinking of the whole. Suppose we have a bottleneck at one robot. In reality, you can probably rebalance the line and solve the problem -- provided you think of it as a whole. It took people six months to understand this, but now it's in their bones. We spend a lot of time going over these concepts and why they are important -- not just in the abstract, but right down to the everyday tangible point of view. That's what building a company culture is all about.'

Jobs extends this philosophy to every area of the business and puts energy into the process as well as the product. This extends to manufacturing, automation, sales and marketing, as well as information systems.

'So, to build a great company, you need more than a great product. You have to pay attention to all the different areas and be as aggressive with them as with your product. Otherwise, you'll spend half your time fixing things that break. And that's typical of high-growth companies. Half the management time is spent making repairs -- stock-option plans, marketing strategies, information systems, whatever.'

He started young and had some success, but inexperience caught up with him. On reflection he recognised the need for an Ambidextrous Organisation and has since mastered the balance between revolutionay and evolutionary change.

Apple had a monopoly on the graphical user interface for almost 10 years. Steve Jobs acknowledges that success preceded failure in a similar pattern to many successful companies. Focus shifted to managing the company and away from innovative product development that led to success. Gradually the monopoly was lost and disruptive innovation from other sources changed the face of computing and the business model.

'But after that, the product people aren't the ones that drive the company forward anymore. It's the marketing guys or the ones who expand the business into Latin America or whatever. Because what's the point of focusing on making the product even better when the only company you can take business from is yourself?'

Jobs was kicked out of Apple and went off to develop NeXt computers and Pixar animations. When he returned as CEO, the company began to return to its innovative roots.

'The system is that there is no system. That doesn't mean we don't have process. Apple is a very disciplined company, and we have great processes. But that's not what it's about. Process makes you more efficient.

But innovation comes from people meeting up in the hallways or calling each other at 10:30 at night with a new idea, or because they realized something that shoots holes in how we've been thinking about a problem. It's ad hoc meetings of six people called by someone who thinks he has figured out the coolest new thing ever and who wants to know what other people think of his idea.

And it comes from saying no to 1,000 things to make sure we don't get on the wrong track or try to do too much. We're always thinking about new markets we could enter, but it's only by saying no that you can concentrate on the things that are really important.'

Has Steve Jobs achieved level 5 leadership? Few would describe him as humble and self effacing, though he is able to stand back and reflect on patterns rather than personalities in the rise and fall of his companies. One test, that is much discussed in the media, is succession planning and whether Apple can continue to thrive as Jobs withdraws from active leadership.

The launch of iPad 2 indicates a shift in identity, as they bring other members of the team to the fore in the promotional video.

Dance fans ask me 'what has this post to do with tango?'

Some UK tango teachers have taught both men and women to dance the steps. Some of these women are shocked to find they are heavily criticised in the dance clubs of Buenos Aires, when visiting Argentina to experience tango in its place. Why? 'Let the man lead. If you lead, the man becomes weak. Your job is to respond deftly to all his signals. He controls the dance. A good leader can turn any woman into a fine tango dancer.'

The legendary Tete Rusconi was one such tango leader.

In balancing technology push and customer pull is Steve Jobs the tango leader or flexible follower?

Gary Hamel has said that the future is already with us, it's just at the edges. What starts off as fringe, ends up as mainstream.

More posts on Steve Jobs here.

Tuesday, 22 February 2011

Losing control of the customer

Everett Rogers published the Diffusion of Innovations in 1962, which clarified how people respond to change and new products.

Companies developed systems for launching innovations and building customer response. The film industry relied on critics to help sell films to audiences. Company web sites included reviews and customer comments. An expert system helped the flow of information and opinions to steer consumers in the desired direction.

What happened?

Amazon and eBay developed systems to include customer reviews on their sites. Consumers became accustomed to giving and receiving feedback from non experts about products and services. Company stooges were relatively easy to spot and ignore in making purchase decisions. These initiatives spawned a range of sites that included consumer reviews and feedback.

What happened next?

Other sites included a forum or discussion boards. Single issue fora focussed discussion around specific products and services. Other web sites included discussion boards about a range of topics and people had space to exchange views on a variety of consumer experiences. Regular visitors to these sites tended to ask fellow members for tips rather than turning to company websites.

What else happened?

Youtube hosted videos that showed how products worked. Some were made by the manufacturers, others by happy or dissatisfied users. Organisations and individuals began to show instruction films on how to do a range of things, including converting Youtube videos to audio files. Some were spoof reviews.

Peer to peer networking increased and companies were viewed as one element of the range of information sources available. Consumers might visit shops or websites to view the product, but looked around for the most competitive price online.

How did organisations respond?

Companies participated in discussion boards in 2 ways: 1) Staff provided helpful information and responded to feedback in positive and constructive ways, 2) Companies took web site hosts to court for publishing inaccurate or defamatory content. Some sites are now more cautious about content provided by consumers in contentious areas. Word gets round about the second tactic and does not boost sales.

Recently I emailed Apple about a problem with their product, which seemed to contravene consumer legislation on description of goods. They fobbed me off by directing me to tech support. I wrote to the Chief Executive (based in the USA) and the UK customer services manager was on the phone to me within a few days. She told me this was the first time she had heard a complaint about this particular problem. I pointed out that people had been discussing the issue for the last 4 years on their own web site fora.

If you don't use your own resources for listening to the customer, then they'll go elsewhere. If you don't or won't provide a solution to their problem, they'll find someone else who will.

Pubs may be closing every week in the UK, but people are finding virtual bars and cafes to gather, build relationships and exchange ideas about products and services. Even government experts no longer dominate:

The late majority and laggards may still respond to conventional systems, but the other 50% of the population comprising innovators, early adopters and early majority have voted with their feet and fingertips.

Russell Ackoff describes the evolution of companies from organisms to communities, in which people below elect their leaders. Perhaps the marketplace is evolving from distinct demographic strata into communities that are proactive and share ideas across demographic boundaries.

Customer relationship management (CRM) has become increasingly complex as customers don't necessarily gravitate to a company's website for information or to complain about their products.

Seller beware!

Leaders under pressure

The Age of Deference is over. Western culture is shifting towards participation, instant celebrity and a sense of entitlement. This seems to be spreading slowly around the globe, through franchised tv programmes.

In the UK, Members of Parliament failed in their attempt to conceal details of expense claims and MPs faced outrage and criticism in the press and in their constituencies for fiddling. Some have been prosecuted in court and gone to prison.

Julian Assange and his team have enabled people around the world to find out what their politicians have been saying behind closed doors as well as individuals who have stashed wealth in Swiss bank accounts out of reach from the tax authorities. He has revealed the extent of civilian casualties in war, which were previously concealed in general terms such as 'collateral damage'. He also disclosed inhuman and degrading practices outlined in the Guantanamo Bay handbook and the instruction to staff to lie to the Red Cross.

What do leaders and organisations do when embarrassing information is made public?

'In this situation, organisations have two choices, says Assange. One is to "engage in plans that the public will support if they are revealed", meaning that they will have nothing to fear from transparency. The other is to "spend additional resources to keep those plans secret". The second, more common, course entails a toll on the economic logic of the organisation, which Assange calls a "secrecy tax". Also, "when an organisation acts in a more clandestine manner", he says, "its own internal efficiency decreases, because information cannot flow quickly through the organisation. This is another form of secrecy tax." For organisations to be efficient, they should be transparent, he insists.'

I'm not sure that governments willingly favour increased transparency. I think it's likely that less communication will be committed to print in future in sensitive areas.

Colin Hutchinson, an inspirational sustainable development consultant, told the story of Norsk Hydro. Environmentalists climbed over the fence of their plant in Norway, took soil samples and publicised the details of their findings after analysis showed substantial heavy metal contamination. The company were aware of the problem, but hadn't publicised it. Instead of increasing security and quashing the story in the media, they developed a comprehensive sustainable development policy and employed environmentalists to train their staff. Colin documented a range of examples of organisations that were criticised for poor practice, but rose to the challenge and developed policies that took them far beyond the initial criticism.

Colin Hutchinson is no longer with us, but his pioneering work lives on.

Friday, 18 February 2011

It's NOT the money

In the West we've slipped into believing that all change requires extra money to fund it. Eric Pickles begs to differ.

Ten years ago young Brazilian film maker told me he had made 6 films already and that students at the National Film and Television School in the UK seemed to think they needed £25,000 to make a film. He made his first work by offering a friend with a cine camera a bottle of vodkha for the use of the equipment. "In Brazil we are accustomed to bureaucratic restriction and meagre resources, so we learn to duck and dive."

The head of a tiny community association operating out of a portakabin with one paid member of staff found ways of dealing with bureaucracy imposed by funders and monitors. He asked an IT friend to design some software to read barcodes on the association's membership cards. Each time they ran an event, they were able to swipe the membership cards and generate the required statistics for the local authority as the gathering ended. Other community groups engaged volunteers to deal with the paperwork in assembling demographics to meet the local Equality Unit's specifications, but this organisation had automated the process in a low cost way.

I've coached professionals who tell me that laborious procedures, irritating and costly to the customer, can never be changed for safety reasons, or because supervisors will resist the change "That's the way we've always done it." When I ask them to consider the purpose of the exercise, it becomes easier for them to make changes and explain them to staff. For example, the NHS recalls people for a number of appointments to check on progress (such as fractures and breakthrough bleeding on skin in elderly people's legs.) Changing the system by telling the patient: 'Come back in X weeks time for your final appointment, but if ANYTHING happens to worry you in between, come straight back', reduces the number of appointments and improves patient satisfaction.

Some organisations undertake customer surveys and employee suggestion schemes, but often fail to engage people. Cynics may believe that any effort put into participating may well be put into a set of amalgamated graphics for a Board meeting rather than leading to any meaningful change.

One of my favourite examples of a successful approach is featured in Factor Four: Doubling Wealth & Halving Resource Use by Weizsacker, Lovins & Lovins. It comes from Dow Chemicals and Ken Nelson, a canny engineer, who devised a self funding scheme to save energy, reduce waste by organising a contest in his division. No managers were allowed to participate and submissions were peer reviewed. The most promising and profitable ideas were implemented. The figures are startling. In the 10th year of the contest (after 700 projects), the 109 winning projects averaged 305% ROI and in 1993 140 projects averaged 298% ROI with savings of $37 millions and more.

'The scheme involved no management thory or fads, but a practical shop floor process that translated volunteer ingenuity into saved money.'

The only reward staff received for participation was the satisfaction of doing something for themselves without management interference and a sense of tangible achievement. Sadly Dow chemicals dropped the scheme when Ken Nelson left.

The Rocky Mountain Institute has a long history of standing back and considering purpose instead of continuing to do more of the same.

Dedicated Follower of Fashion

Followers of management fads tend to focus on the process without being clear about the purpose and goal. Quality systems often led to the destruction of Norwegian pine forests in paper processing. Employees groan under the weight of procedures, without experiencing the benefit of the scheme.

In contrast, leaders who are clear about their purpose and with a vision of what a management tool can achieve are able to communicate this and engage colleagues in creating a system that is straightforward and brings tangible benefits. One surprise for me as a consultant is the number of managers I've met near to retirement who don't want to leave the job because a new leader has motivated them to implement a quality system and given them a renewed sense of having worthwhile career. The system is integrated smoothly in daily work, boosting ownership of process and results and empowering team members. Quality is then 'part of what we do', rather than a fashionable status symbol that is tossed out as soon as a new fad is adopted.

Once a management tool has been adopted and produced results, the biggest challenge is to maintain momentum and prevent it from fading out. Some of the most forward thinking companies I've worked with suffer from this problem, as they adopt new approaches and find it tough to maintain existing ones. The more the approach is integrated into daily procedures and becomes the default way of operating, the more likely it is to survive.

Management fads are not inherently flawed. Following the herd without a clear rationale for adopting an approach is likely to end badly. Failing to communicate clearly and motivate the team to embrace the approach to make it their own is the best way to ensure a management fad collapses and creates resentment amongst staff. Clarify the purpose and goal, simplifying the process to fit and success is possible.

Here's one view on the role of leaders:

Thursday, 3 February 2011

'They'll never change'

That's the cry I hear from many coaching clients, when talking about their staff. I then hear a list of complaints about people who fail to comply with requests and instructions from their manager. 'It's hopeless. I'd like to sack the lot of them and form a new team.'

How do you communicate with them? I ask.

'Oh I email regular instructions and reminders, but they ignore them' is the common response.

No matter how intelligent or educated your audience, it's surprising how little people absorb from the written word. Facial expression and voice tone are missing, so it's easy to put a negative spin on the communication, especially when the relationship is weak.

Many of my clients work a few desks away or on the floor above their staff, so it's not difficult for them to get off their backsides to go and have a conversation with their colleagues. This gives them an opportunity to LISTEN to any problems or blocks to implementing the proposed change.

When the manager works in a distributed organisation with staff scattered across the country or several continents the task becomes more difficult.

UCU, the higher education trade union has followed the example of the Open University's Mr Bean and taken to Youtube to overcome this problem.

One minute 26 seconds of film enables union officials to convey much more than long letters or emails ever can. If they then read and respond to feedback posted by viewers, the relationship strengthens.

People can and will change if managers think about how best to influence them.

Facetime works, if used well.

Wednesday, 2 February 2011

Yo Schumpeter!

John Maynard Keynes has influenced Western governments to intervene in economic recessions and depressions and spend their way to recovery. An alternative view by the Austrian School, that markets should be freed to find their own level by trusting the spontaneous organising power of the price mechanism, is less popular. Co-founder Friedrich Hayek is now getting a boost from a rapper, who explains some of the basic principles.

It's time to ask Joseph Schumpeter to ride to the centre of the screen.

Schumpeter was unusual because he rejected abstract mathematical economic theory that attempted to simplify variables to prove that one caused the other. He included sociological understanding in his economic theories and recognised that economic cycles are more complex mathematically than previously thought.

Schumpeter championed the entrepreneur as the main driver of innovation and disrupter of business cycles in equilibrium. He believed that innovation came from within the economic structure and called this Creative Destruction. His views on the demise of capitalism paralleled those of Karl Marx, but with a different progression. Advanced capitalism would stagnate from within, by regulating society in such a way that the social and intellectual climate necessary for entrepreneurship to thrive would fade.

There's no rap song to Schumpeter yet, but someone has built a shrine to him in his own words.

Joseph Schumpeter wasn't just an academic and prolific author, but had been President of a bank and Finance Minister of a Socialist government, despite his more conservative/libertarian views.

Keynes versus Hayek Round 2 is here: