Gary Hamel: Three Challenges Facing Organizations

I just read this blog and couldn't say it better myself:

Published by Michael Lee Stallard on October 11, 2009

Last week I was invited to attend the World Business Forum in NYC with 50 other leading bloggers. The presentation that resonated the most with me was Gary Hamel’s. In it, he outlined three challenges facing today’s organizations:

1. How do we build an organization that can change as fast as change itself? Change is accelerating at this time in history and organizations need to act faster to deal with opportunities and threats. Consider the changes in the last century including in healthcare, microprocesssors, transportation, computing power, the internet, telephony, gene sequencing, biotech, etc.

2. How do we build an organization where innovation is everyone’s job? The accelerated pace of change makes this a necessity. Do employees understand their organizations innovation insights? Is every employee’s contribution to innovation measured?

3. How do we build an organization that actually inspires extraordinary accomplishment? This is the most important of the three challenges facing today’s organizations. On average, seventy-five percent of employees are not engaged in their jobs. We need employees who regard their jobs as the way to bring their passion in the world. Our job as managers is to build a work climate, a sense of purpose that inspires initiative because obedience, diligence and intellect are mere table stakes in today’s hypercompetitive marketplace.

These ideas are from Hamel’s book, The Future of Management.

The Kinds of Employees You Want to Hire

Those who are innately confident and self-directed routinely outperform co-workers, regardless of their backgrounds

By Nick Tasler

There are two kinds of employees. Some believe they can make things happen, and the others believe that things happen to them. The first group believes that the outcome of their life and career is more or less in their own hands, and they wouldn't have it any other way. The other group takes the approach of sitting around and waiting for a bus to take them somewhere.

This distinguishing feature is captured by something called a "core self-evaluation." After more than a decade of research, psychologist Tim Judge has discovered that virtually all superstar employees—from rainmakers in the field to line workers on the floor to big guns in the boardroom—have one thing in common: a high core self-evaluation. Judge describes core self-evaulation as "a person's fundamental bottom line evaluation of their abilities."

Judge and his colleagues have shown overwhelmingly that employees who feel like they control the events in their lives more than events control them, and generally believe that they can make things turn out in their favor, end up doing better on nearly every important measure of work performance. They sell more than other employees do. They give better customer service. They adjust better to foreign assignments. They are more motivated. They bring in an average of 50% to 150% more annual income. Not surprisingly, these employees also like their jobs a lot more.

Better Performers in Good Times and Bad

In one study, Judge and his team tracked the progress of more than 12,000 people from their teenage years to middle age. He found that core self-evaluations predicted who did and didn't capitalize on the advantages life dealt them. With only a bleak view of their capacity to handle life's challenges and opportunities, even the brightest kids born to executives and engineers failed to reach as high an annual income as their less fortunate classmates.

By contrast, the supremely confident sons and daughters of roofers and plumbers who had only mediocre SAT scores and below average grades earned a 30%-60% higher income than the smart kids with dreary views of their abilities. And those kids with all the advantages of intelligence and pedigree plus a firm belief in their competence earned three times as much money as their otherwise equally blessed peers.

It seems that the difference between the successful and the unsuccessful employees has as much to do with an employee's beliefs about her ability as the reality of that ability. Considering that this difference is based as much on illusion as on reality, you might think the employee's performance would take a serious nosedive under challenging circumstances.

After all, if you think you're special, what happens when your superior or your board tells you about the areas in which you're falling short? Worse yet, what happens when the self-described superstar finds himself laid off or responsible for a division with tanking revenues? In other words, what happens when people who believe they are capable of controlling the world find themselves in an economy that is out of control?

It turns out that this is when the true stars shine. Tough times weed out both those with low self-evaluations and those who only pretend to have a high self-evaluation. In a series of studies by different researchers, employees with high self-evaluations have been found to respond better to corrective feedback. They also experience less stress and burnout than other employees, struggle less with work-life balance, and persevere more when searching for a job. Rather than shattering their beliefs in their abilities, it seems that a high self-evaluation creates a mental toughness that makes these people stronger and more resilient even when the chips are down.

The Core of Your Recovery Strategy

To identify these stars who can take charge of your organization's rebound, you can use Judge's simple 12-question "Core Self-Evaluations Scale." (You can learn more about the scale and download it for free on Tim Judge's Web site.) It would also be a good idea to start keeping an eye out for these positive go-getters already working for you and consider giving them more responsibility and visibility in your recovery efforts. Here is how to spot them:

• "I Think I Can" Attitude: Kindergarten never taught a lesson more supported by empirical evidence than this: People who believe they can overcome challenges are more successful in virtually every sphere of life, including work.

• In Control: Does this employee take control of his work, or does he always point to outside circumstances when his projects go astray?

• Confident, Not Narcissistic: There is an important difference between having a high self-evaluation and being a narcissist. Does the employee pitch in when teammates need help, or bad-mouth co-workers they view as threats? Are they receptive or defensive when you give them feedback?

• Emotionally Stable: Employees who aren't easily discouraged are less likely to succumb to stress and burnout. They solve problems instead of saying, "See, I knew it wouldn't work!"

You could argue that getting these winners and their can-do attitudes on board still can't do much about a dismal economy. After more than a year of watching the economy go the way of the Titanic, nobody would blame you for trying to wait out the hard times. But do you really want to spend the coming months soothing your anxieties with a box of chocolates, and hoping that your bus arrives before the wind picks up?

Making Better Decisions

By: Karen Rulifson

Nick Tasler recently had an interview done for his book, The Impulse Factor, and I wanted to share it here. Through his years of research, he found our efforts to make better decisions aren't complete if we don't take into consideration who is making the decision. He mentions about one quarter of the population have impulsive tendencies while the rest of the population are risk managers. He then provides a clear understanding of how we make the choices we do and the tools to make better decisions. Here is his interview:

How is your book different from other books out there on improving your decision making?
There are a lot of really great books on decision making out there. Virtually all of them are focused exclusively on how certain situations are going to impact the decisions we make. Now, that’s really important information, but a key piece of the puzzle is missing if you really want to improve the way people make decisions. You must take into account the natural tendencies of the decision maker. How each of us differs—whether we are more cautious or more impulsive—is going to impact how we see a given situation, and ultimately how we make a decision in that situation. Genetics have a lot to say about which kind of decision maker you are, and so do the experiences that have shaped you over the course of your life.

How are they alike – and how are they different?
Some people simply are more impulsive than other people, and they tend to make quicker—often riskier—decisions than other people. We know from a slew of psychological research that’s been done over the past decades that the majority of people steer clear of risk whenever they can. But not everybody fits that cautious mold. A naturally more impulsive person—that includes about a quarter of the population--doesn’t make decisions the same way most people do. They see things differently. Where the cautious majority of people see situations in light of what they might lose and how to manage the risks, the more impulsive people make decisions based on what they stand to gain from that situation. Cautious people tend to be more concerned with preserving their peace of mind, where impulsive people are concerned with scoring a bigger piece of the pie.

Another key difference is that the impulsive people tend to be much hastier when making decisions. And they actually prefer it that way. Think about this: impulsive people are nearly five times more likely to prefer making decisions under time pressure than cautious people are. In fact, 72% of cautious people said that they are least comfortable making decisions under pressure-packed conditions. On the other hand, over half of impulsive people said that they are most comfortable making decisions when they are pressed for time. As you can imagine, that stark contrast in styles has a huge impact on the conditions individual people need in order to make good decisions. To get the best results, some people need enough time, and others need limited time.

Why is it important for people to know their decision making style?
It’s absolutely vital knowledge if you ever intend to become a better decision maker. If you don’t know the way you naturally tend to approach decisions, then you’re going to end up reading a lot of advice and trying a lot of strategies that simply don’t apply to you. We often hear that you need to allow yourself plenty of time to make decisions. That’s fantastic advice for cautious people, but not for impulsive people. On the other hand, we generally don’t need to tell a more cautious person to think things through or to count the costs – they do plenty of that already. Both kinds of decision maker play a crucial role, and there are strategies they can both apply to become better decision makers. But the strategies are going to be different depending on which kind of decision maker you are.

The Impulse Factor talks about a genetic difference between the two, tell me more about that.
That’s one of the most fascinating things I found when researching the book. For a long time, I had been seeing these stylistic differences between people even though most researchers were glossing over it. But only recently have scientists begun to focus a lot of attention on a certain dopamine gene. Basically, this gene affects the way some people’s brains deal with dopamine. Dopamine is a brain chemical what makes us feel excited. For example, when you’re standing at the edge of an open airplane door with a parachute on your back or getting ready to buy a risky stock, your dopamine levels jump before you do. Except about 20-25% of the population has a certain dopamine gene that mutes the response that these people have to dopamine. So, where most of us can get excited by a good book or a roll in the hay, it doesn’t cut it for these people. They are wired for more stimulation, which makes them do things that most of us wouldn’t. They end up doing a lot of things without fully considering the risks or the consequences--it makes them impulsive.

In today’s fast environment, wouldn’t it be better if we were all impulsive?
Not so fast. We can’t forget that positive developments have come hand-in-hand with some rather unpleasant side effects. The need for stimulation seems to play a big role in addiction and other social ailments that we would be better off without. Traditionally, we haven’t paid enough attention to the positive aspects of impulsivity, but we absolutely can’t deny its negative aspects. If everyone were impulsive, businesses would all function like Enron, family life as we know it would be almost non-existent and human society would probably slip into unrelenting chaos. The truth is that we need a balance of impulsive people and cautious people in virtually every family, team, company and society. In fact, we need just as many, if not more, cautious people than impulsive people.

Ahh, and what might the most cautious segment of the population learn to improve their decision making style?
First of all, they really need to understand that caution is sexy too. Without fail, every time I give a group of people the Impulse Factor test, some people are always disappointed to find out that they are more cautious. They feel impulsive people are the only ones having fun or achieving success, which is clearly not the case. Impulsive people might sound more exciting, but on the whole they are also far more dangerous—to others and to themselves. Acting on a healthy respect for risks and consequences the way more cautious people do, is a good thing. Cautious people are three times as likely to consider risks before acting and are much less prone to taking shortcuts than impulsive people. An impulsive person left to their own devices will spend more time chasing their tail than creating any kind of value for themselves, their company or their society. So, if you’re cautious take pride in the fact that you don’t usually act rashly or carelessly.

The Great Entreprenuerial Leader

by: Gina L. Kellogg, MA

As an entrepreneurial leader you are moving in what feels to be a thousand different directions. You are balancing business development, operations, employee management, your personal life and the desire to do the craft you love. You find yourself in a circle of dismay, at the same time being filled with the satisfaction of making "it happen". You wear all the hats, play all the roles and make sacrifices beyond the imagination of the mainstream. You do this because you know, in the core of your being, that what you believe is possible. You can feel, smell, see, taste and hear the reality of your dream. You are already living in the vision and image of what your hands are in the process of creating.


In coaching entrepreneurial leaders, I have found there to be a great difference between entrepreneurial leaders who "make it", and those who find themselves choosing to settle back into a life of "clocking in". Those who "make it" know what they stand for. They honor their personal values, and are an inspiration to others because they exude through every ounce of their being truth, authenticity and a genuine understanding of self. They have a vision, believe in their vision, and articulate their vision with such conviction and meaning that others gravitate to the mere image of what the entrepreneur already knows to be true. They are courageous, face their fears and view the inevitable challenges as opportunities to transform, grow and learn. Most of all, they embrace and welcome the evolution and constant change that will create a greater brilliance than even they themselves are able to imagine.

The Perfect Entrepreneurial Storm

By: Sarah Sladek, Limelight Generations

A few weeks back, I was a mentor for the Girls Going Places Entrepreneurship Program in Minneapolis. I was truly inspired by how business-saavy these young girls were, and being in the generational line of work, I know that today's students and young adults claim the largest volume of start-ups in America. This business-savvy generation presents great opportunity for some, and great challenges for others. In either case, this generation presents significant change for our business climate as we know it.

An April 27, 2009 article in BusinessWeek refers to this change as the "perfect entrepreneurial storm". Just as the famously independent Generation Y enters business school, the world economy goes to hell in a handbasket. The former blue chips of Wall Street can no longer offer long-term job security and generous end-of-year bonuses, giving this new generation of MBA graduates the impetus to pursue their own business ownership dreams.

If business schools are smart, they will rush to embrace this entrepreneurial generation and give them the tools they need to realize those dreams. The time is certainly ripe. Most colleges had already observed declines in enrollment in nearly every major--with the exception of business.

What can business schools do to unleash this generation's inner entrepreneur? The BusinessWeek article advises them to take a cue from the Tuck School of Business (Tuck MBA Profile) at Dartmouth, which is hosting a new business plan competition, with a $50,000 prize, in an effort to inspire new entrepreneurial ideas and create jobs on both a local and national level.

Or they can follow the lead of schools like the Haas School of Business (Haas MBA Profile) at the University of California, Berkeley. The school's Lester Center for Entrepreneurship & Innovation provides students with the expertise to pursue their ideas and improve their negotiating hand with venture capitalists. It's a great example of how to encourage innovation in both new and established companies, and we need more such schools offering innovative solutions to the entrepreneurial challenge. With their accumulated store of knowledge about how to launch a business, and proximity to the profitable ideas in technology and the sciences, business schools should be the ideal platform to nurture a new generation of entrepreneurs. And this generation—highly social, confident, and networked—seems ready for the challenge.

I would add that high schools could take a lesson from Thomas Alva Edison High School's Business Entrepreneurship Program. The Business Enterprise program utilizes work-readiness training, job shadowing, e-mentoring, college site visits, guest speakers, and entrepreneur and high-tech clubs to give students a foundation of skills to build upon and transition from a high school setting to post-secondary two-year and four-year educational programs. If more schools provided business training at an earlier age, perhaps America's workforce would be successful at bridging the talent gap and not be in danger of lagging behind Europe, India, Australia, and other countries already preparing their next generation workforce.

Certainly the world needs this new generation of business-savvy entrepreneurs—now more than ever before. If the economy is going to recover, their optimism and their new ideas will be a big part of the reason.

Trophy Kid to Shot-Caller Rule #1: Speak Up without Talking Down

By: Nick Tasler

The one thing middle managers and executives alike from companies of all shapes and sizes agree on is that credibility comes from speaking up. In the knowledge economy where information is worth more than its weight in gold, it is critical to be an active participant in the knowledge exchange. As young employees, there are two fatally flawed tendencies that get in the way of effectively speaking up.

1. PROBLEM: TAKING WITHOUT GIVING

Remember this: Your employer is not your teacher. The importance of being a good learner was relentlessly drilled into us from the very first time our miniature shadows darkened the doors of our kindergarten classrooms. While growing up, our lives were dominated by authority figures—coaches, teachers and parents—whose job was primarily to teach us. To maker their jobs easier, they taught us how important it is for us to be willing to learn. Managers, however, need more than just your willingness to learn. A manager’s job is about getting things done and they need your help for that. Good managers don’t mind teaching you, but all of them expect you to do more than soak up knowledge.

SOLUTION: Paraphrase if you must, just contribute something. Ideally, you’ve done some homework or solid thinking before a meeting or during an email exchange so that you have something new to add. But as my Gen Y friend Eric told me “if you’re in a meeting and you really can’t think of anything new to add, then at least paraphrase a main point.” His managers agree. It shows that you’re actively participating and not just being a parasite on other people’s mental energy. And it really can help to crystallize fuzzy concepts for other people who maybe aren’t totally getting the big picture yet.

2. PROBLEM: Speaking with Unearned Authority

Personally, I’ve never had a problem voicing my opinion. I was that nerd in the 200-student lecture in college that raised my hand to ask the professor a question. For those of you more like me, remember this: It’s good to speak up, but bad to be a know-it-all. Bosses and co-workers want your contributions. What they don’t want is your baseless certainty, your sarcasm or your need to constantly display your superior intellect. I made this mistake more times than I care to admit when I started my career, and my ideas always suffered because of it.

SOLUTION: Master the Art of Suggestion. Even when you’re making a statement, phrase it as a suggestion. Instead of saying “This apple is clearly red,” say “I wonder if this apple is red, even though some parts of it look green like Sam mentioned?” Statements come across as argumentative even when you don’t intend them to be. Suggestions come across as though you’re trying to building on other people’s ideas instead of demolishing them to make room for your own.

Destination Nation

By: Gina Kellogg-Gardner, MAOL

As a store manager I loved managing destination stores. You know the store locations that customers have to go out of their way to shop at, stores that are off the beaten track. Why did I love managing these store locations? Well, even though my traffic was less than my fellow store manager’s locations my customers were on a mission to buy! Customers walking into a destination store go out of their way to get there, and are already in a purchasing mind-frame when they arrive. Because my customers were ready to purchase, add-on-sales and up-selling was that much easier. My traffic may have been lower, but my conversion rate and sales ratio was through the roof.

Has today’s economy actually turned your retail store into a destination hot-spot? Today, consumers are making a conscious decision for how and when they spend their money. Because consumers are more intentional about when and what they buy, when a customer does walk into your store they have already made the decision to buy. In our economy, your customers are in a purchasing mind-frame when they walk through your doors! Learn how to take advantage of the economic climate, increase your retail sales and breathe a sigh of relief. Register for Destination Nation, and on June 30 experience this season’s thought provoking session and retail inspiration. >>>Retail Fusion.