!DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Strict//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-strict.dtd">
Streamline Training & Documentation: June 2008
Streamline Training & Documentation
Monday, June 30, 2008
Business Social Networks Need to be Managed
In addition to the brief research reports discussed in the last twoposts, the July-August 2008 issue of the Harvard Business Review offers a third piece on a topic of particular interest to me, namely organizations' social networks.
Adam M. Kleinbaum, a postdoctoral fellow, and Michael L. Tushman, a professor of business administration, respectively, at Harvard Business School, have been examining what sort of social networks promote successful identification and implementation of innovations.
Kleinbaum and Tushman make two main points.
First, "idea brokers" — people with broad cross-divisional networks — are important for catalyzing generation of ideas for productive collaboration. However, "idea brokers are rarely able by themselves to mobilize the organizational support and resources necessary for execution."
For implementation, a different sort of person is needed — someone with deep cross-divisional relationships. Such deep relations "enable the exchange of fine-grained and tacit information, help actors navigate the unfamiliar terrain of partner divisions, and allow cohesiveness to build within the network, increasing trust and reducing intergroup rivalry."
Second, executives must work to shape and cultivate their company's social networks. Kleinbaum and Tushman recommend a two-pronged approach:
Invest in both idea brokers and in people with deep cross-divisional relationships.
Develop the skill needed for encouraging and overseeing informal networks. In particular, "executives must proactively manage the transition between discovery of a collaborative opportunity and execution of a cross-divisional project. They can do this by selecting people for important positions on the basis of not only their skills and prior experience but also the nature of their social networks."
It goes without saying that taking people's social networks into account requires explict analysis of what those social networks are. Tools such as that described in this post can help with network mapping.
As a follow-on to an earlier post looking at research concerning the relationship between diversity and team performance, I'd call attention to what Jeffrey T. Polzer, a professor of human resource management at Harvard Business School, has to say on the subject in a brief piece in the July-August 2008 issue of the Harvard Business Review.
Along with Bill Swann, a professor of social and personality psychology at the University of Texas, and Laurie Milton, a professor of human resources and organizational dynamics at the Haskayne School of Business of the University of Calgary, Polzner has researched
the fit among team members and how to optimize it. We define “fit” as interpersonal congruence — the degree to which members’ appraisals of one another are similar to their self-assessments on dimensions relevant to team functioning. For example, if a team member sees himself as a creative leader, do others see him the same way? Our research has shown that high congruence improves the performance of diverse teams.
To facilitate achievement of interpersonal congruence, Polzner recommends use of 360-degree feedback. He argues,
When thoughtfully gathered and exchanged, such information can open the lines of communication on topics that are usually off-limits precisely because they are uncomfortable to discuss. Members can correct colleagues’ inaccurate perceptions, learn where their own judgments of others may be skewed, and adjust their behaviors and self-assessments.
Polzner cautions that teams must be ready to handle 360-degree feedback constructively. He identifies four readiness criteria:
The team leader is open to receiving feedback and is able to model appropriate responses to it.
Team members have at least a degree of mutual respect and trust, and they want to improve their joint performance in order to achieve a shared goal.
The feedback data are used for development, not evaluation.
A qualified and trusted facilitator guides the team discussion and helps with planning the improvement steps the team members will take.
As an example, Polzner describes the experience of a management team in Bangalore that used 360-degree feedback to help improve members' collaboration.
I'm one of those people who wonders if self-confident men don't generally find better things to do with their time than putting a lot of effort into proving their manliness. Now, thanks to Robin J. Ely, a professor of organizational behavior at Harvard Business School, and Debra Meyerson, a professor of education at Stanford, I have fresh evidence that the most effective workers in heavily male occupations, such as offshore drilling, are mission-focused, not hung-up on maintaining a macho image.
In the July-August 2008 issue of the Harvard Business Review, Ely and Meyerson report on what they learned from studying at firsthand life aboard two oil platforms. They explain that
over the past 15 years or so the platforms we studied have deliberately jettisoned their hard-driving, macho cultures in favor of an environment in which men admit when they've made mistakes and explore how anxiety, stress, or lack of experience may have caused them, appreciate one another publicly, and routinely ask for and offer help. These workers shifted their focus from proving their masculinity to larger, more compelling goals: maximizing the safety and well-being of coworkers and doing their job effectively.
The result of company-wide changes in "work practices, norms, perceptions, and behaviors" has been an 84% drop in the accident rate over the 15-year period in question, and achievement of levels of productivity (number of barrels produced), efficiency (cost per barrel), and reliability (production uptime) in excess of the previous industry benchmarks.
The US Army Commits Itself to Valuing Trainers' Work
One of the most significant promises of change I've come upon recently is reported in the June 19 edition of the Wall Street Journal. According to the Army Chief of Staff George Casey, the US Army is going to reform how it values training assignments when making promotion decisions.
Traditionally, time spent on a training team — for example, training police in Iraq — does not help a service member's career, no matter how well the individual in question handles the assignment. If this dismissive view of the contribution good trainers make to achieving military goals does actually change, it will be a big step forward.
I will be watching for evidence that the promised change is actually occurring.
For all the times one encounters references to business models, it is surprising how little specificity there is concerning what a particular, or even a generic, business model looks like.
Alexander Osterwalder has published considerable helpful guidance on desribing and improving business models. To get a quick idea of the business model structure he uses, you can look at the the slideshow here. Slide 12 presents the diagram of the nine building blocks in Osterwalder's structure which is reproduced below.1
(click to enlarge)
To illustrate the above structure in practice, Osterwalder provides examples drawn from Xerox and Cirque de Soleil on slides 14 and 32, respectively.
The pièce de resistance comes on the final two slides of his presentation, in which Osterwalder illustrates how a company whose current business model centers on selling waste water treatment systems for one-time sales revenue, can shift to a new business model in which it offers total waste water management for which it receives recurring service fees.
Osterwalder provides a fuller explanation of this business model structure in a brief, accessible manual available here (pdf).
__________ 1 Osterwalder developed his business model structure in collaboration with Prof. Yves Pigneur of the HEC Business School of the University of Lausanne.
Over the hearth with my 'minishing eyes I muse; until after the last coal dies. Every tunnel of the mouse, every channel of the cricket, I have smelt, I have felt the secret shifting of the mouldered rafter, and heard every bird in the thicket. I see you Nightingale up in the tree! I, born of a race of strange things, of deserts, great temples, great kings, in the hot sands where the nightingale never sings!
As a complement to my earlier post concerning Peter Bernstein's views on risk management in the private sector, I'd call attention to what Malcolm Sparrow, a professor of the practice of public management at Harvard's Kennedy School of Government, has to say about risk management by government regulatory agencies.
Sparrow explains his thinking in a June 5 interview published by the Kennedy school:1
Increasingly, we see police agencies, environmental agencies, occupational safety, even custom officials focusing deliberately on specific, carefully identified problems. They are learning to spot very specific patterns of hazard or risk concentrations, whether these “knots” are crime problems, or specific environmental issues, occupational hazards, or patterns of drug-smuggling. What these agencies are learning to do — and which they find organizationally quite awkward — is to spot specific issues, study their structure, and devise tailor-made interventions. When they act in that way, the solutions they invent usually represent substantial departures from their agency’s business-as-usual. When they do this well, you see these almost surgical interventions — producing significant reductions, sometimes the complete disappearance of a specific pattern of harm — all as a result of this type of disciplined thinking, consciously focused on subcomponents of some general class of harm.
... Focusing on specific bad things (risk-concentrations, trends, patterns, etc.) offers you the opportunity to think and act like a saboteur: to find a vulnerability of the harm itself, and remove it, or produce a scarcity which the opposing forces cannot cure. And sabotage is efficient, assuming you’ve adequately understood the object to be destroyed, and its vulnerabilities. Many agencies are beginning to appreciate the resource-efficiency and effectiveness that comes from this type of artful “sabotage of harms.”
Sparrow often uses the word "harms" in lieu of "risks" to emphasize the difference between what a public agency does in managing risk and what a private company does:
A lot of government agencies’ core task is to identify societal risks and to suppress those risks effectively and at minimum cost and intrusion. ... It is not “risk management” in the normal sense of “managing risks to my organization.” It’s risk management as an operating framework for doing the agency’s core business, which is working on risks or harms to health, welfare, security, or the environment.
In sum, Sparrow believes an effective regulatory agency gives concentrated attention to "what piece of a task to bite off, and how many bites, and what type of performance account should they expect at the end."
The June 23 issue of Information Week has a quite interesting one-page profile of Mike Foley, the CIO of MassMutual. What particularly caught my eye was Foley's explanation of how he and his colleagues measure IT effectiveness. It's a matter of answering four questions:
Do our business partners believe they're receiving excellent value for their IT investment?
Is there high operational stability?
Is there strong project execution and quality delivery?
Is the IT plan explainable in a way that parallels the business strategic plan?
On May 28, Nathan Conz, writing for Insurance & Technology, provided an extended account of how the IT department at MassMutual has approached making sure that the answer to each of the above questions is "Yes." Among other things, the company has made a point of helping employees expand their skills beyond technical competencies. To this end, MassMutual is creating a more open work environment:
Dress codes have been relaxed, open floor plans have been instituted and nonhierarchical seating arrangements have been put in place. Meanwhile, the carrier has started to colocate business and IT teams in the same workplace.
Recently, the company went to a federated organizational model that has more closely integrated certain IT teams with individual business units. In some instances, MassMutual execs say, it has become difficult to immediately differentiate IT workers from business workers in meetings.
Beyond the benefit to its operations, MassMutual is looking to its modernization efforts to help in recruiting.
MassMutual's recent intiatives would seem to be bearing fruit. As reported here, statutory net gain from operations before dividends and taxes was up 25% in 2007 over 2006 (which was also a good year, as reported here).
I don't generally buy books in hardback, but a few are too attractive to put off reading until the paperback is out. In 1996 one such was Against the Gods: The Remarkable Story of Risk, by finance expert Peter L. Bernstein, which I bought as soon as I heard about it.
In the book, Bernstein describes the centuries-long history of philosophers, mathematicians, and other thinkers gradually acquiring an accurate understanding of risk. He then goes on to discuss the principles of sensible risk management that eventually were worked out to guide decision-making under uncertainty. Midway through the book, he explains:
When we take a risk, we are betting on an outcome that will result from a decision we have made, though we do not know for certain what the outcome will be. The essence of risk management lies in maximizing the areas where we have some control over the outcome while minimizing the areas where we have absolutely no control over the outcome and the linkage between effect and cause is hidden from us.
Finally, in bringing his book to a close, Bernstein notes:
... the science of risk management sometimes creates new risks even as it brings old risks under control. Our faith in risk management encourages us to take risks we would not otherwise take. On most counts, that is beneficial, but we must be wary of adding to the amount of risk in the system. Research reveals that seatbelts encourage drivers to drive more aggressively. Consequently, the number of accidents rises even though the seriousness of injury in any one accident declines. Derivative financial instruments designed as hedges have tempted investors to transform them into speculative vehicles with sleigh-rides for payoffs and involving risks that no corporate risk manager should contemplate. ... [links added]
Fast forward to today's New York Times. In a brief column, Bernstein applies the principles of risk management to the current debacle in our credit markets. He notes that the questions investors should have been asking as they bought houses and mortgage-backed securities were:
How will we deal with surprises — outcomes different from what we expect?
What are the consequences of being wrong in our expectations?
Bernstein reinforces the centrality of these two questions in his conclusion:
Effective risk management starts with the recognition that any forecast [e.g., a forecast about the future level of housing prices] can be wrong, then weighs the consequences of being wrong. Only then can we decide whether to make a bet, whether to hedge that bet and how to execute the hedge if needed.
The five minutes it will take you to read Bernstein's column will be time well spent.
I have listened to the Saturday radio broadcasts of the Metropolitan Opera since I was in college. It was an enormous comfort to me that I could learn opera basics from the radio intermission features in the privacy of my dorm room, where no one would know how ignorant I was of the standard repertoire and the musical features of the genre.
I've continued to follow the Met (though scarcely with the intensity of a genuine aficionado), and am now among the growing numbers who are marveling at how satisfying it is to watch Met general manager Peter Gelb's transmission of high-definition performance broadcasts to movie theaters. When I talk about the broadcasts with friends, one of the things we wonder about is whether the broadcasts are actually making money for the Met.
Apparently, the answer is "not yet," but prospects are good for a positive contribution to the bottom line as early as next season, the third for the broadcasts.
You can read more about the broadcasts, and the other marketing initiatives the Met has undertaken since Gelb arrived, in an illuminating blog post by Ben Rosen, a past Met board member.
A complementary essay by Ann Patchett, in which she describes her response to the Met's high-definition broadcasts, was published in today's edition of the Wall Street Journal.
At BNET.comGeoffrey Jamessums up first-line strategies for dealing with seven "bad boss behaviors," with supporting quotes from various experienced businesspeople.
The problem behaviors James covers are:
Chronic mismanagement
Vague priorities
Explosive temper
Absurd expectations
Belittles you in public
Avoids difficult decisions
Demands unreasonably long hours
A number of the people who comment on James's taxonomy say he has left out the boss who is a bully, and offer suggestions for how an organization should address bullying behavior. An earlier post on dealing with workplace bullies is here.
In the process of working on a project involving the Centers for Disease Control and Prevention (CDC) in Atlanta, I came upon a helpful list of eleven "Attributes of Effective Health Communication."
This list (here slightly edited) merits wide circulation in its own right and because most of the attributes apply beyond the health field:
Accuracy — The content is valid and without errors of fact, interpretation, or judgment.
Availability — The content (whether targeted message or other information) is delivered or placed where the audience can access it. Placement varies according to audience, message complexity, and purpose, ranging from interpersonal and social networks to billboards and mass transit signs to prime-time TV or radio, to public kiosks (print or electronic), to the Internet.
Balance — Where appropriate, the content presents the benefits and risks of potential actions or recognizes different and valid perspectives on the issue.
Consistency — The content remains internally consistent over time and also is consistent with information from other sources. (The latter is a problem when other widely available content is not accurate or reliable.)
Cultural competence — The design, implementation, and evaluation process accounts for special issues for select population groups (for example, ethnic, racial, and linguistic) and also educational levels and disability.
Evidence base — The content is based on relevant scientific evidence that has undergone comprehensive review and rigorous analysis to formulate practice guidelines, performance measures, review criteria, and technology assessments for telehealth applications.
Reach — The content gets to or is available to the largest possible number of people in the target population.
Reliability — The source of the content is credible, and the content itself is kept up to date.
Repetition — The delivery of/access to the content is continued or repeated over time, both to reinforce the impact with a given audience and to reach new generations.
Timeliness — The content is provided or available when the audience is most receptive to, or in need of, the specific information.
Understandability — The reading or language level and format (including multimedia) are appropriate for the specific audience.
Using Abstraction to Make it Easier to Apply Learning
"It is very difficult to extract mathematical principles from story problems. Story problems could be an incredible instrument for testing what was learned. But they are bad instruments for teaching."
That's what Vladimir Sloutsky, a professor of psychology at Ohio State University, had to say in talking about the relative merits of abstract examples vs. concrete examples when teaching math principles.
In a study led by Jennifer Kaminski, a research scientist at Ohio State University's Center for Cognitive Science, of which Sloutsky is the director, experiments showed that students were better able to apply principles to a variety of situations if they were taught the principlpes in the abstract, rather than via scenarios built from concrete details.1
The example cited in OSU's press release about the research is "the classic problem of two trains that leave different cities heading toward each other at different speeds. Students are asked to figure out when the trwo trains will meet." Even if they are able to get the correct answer, it turns out that solving the train problem does not much help when they encounter an equivalent problem with different details, such as levels of water rising over time.
The problem seems to be that "extraneous information about marbles or containers [typical props in concrete examples] divert attention from the real mathematics behind it all."
Even while recognizing that people have different learning styles, there is a lesson here for business trainers who, all too often, overdo cutesy examples in their courses.
On the other hand, it is important to note that the above is not an argument against training that uses examples taken directly from the on-the-job context in which learning is to be applied. On the contrary, such an approach is advisable because it reflects important principles of adult learning.
The slideshare.net site offers a wealth of searchable material that is easy to browse. As an example of what you can tap into, below is a slideshow uploaded by Mark Normand, Managing Director of Impress Training, a company in Singapore he founded. (You need Verson 9 of Flash Player installed to view the slideshow.)
I came upon a reference in a trade publication to a short paper offering advice on best practice in designing spreadsheets, and checked it out. Unfortunately, the write-up in question, while conceptually sound, was not user-friendly and violated some best-practice principles itself (e.g., with respect to properly labeling spreadsheets).
So I followed some additional leads for practical guidance on designing spreadsheets and came upon a 2005 paper (pdf) by Philip L. Bewig, a St. Louis CPA. (I found the reference and link to the paper at the website of the European Spreadsheet Risks Interest Group.)
"How Do You Know Your Spreadsheet is Right? Principles, Techniques and Practice of Spreadsheet Style" is a treasure trove, well worth reading in its entirety (only 12 pages, not counting endnotes) if you have any responsibility for preparing spreadsheets.
Some items Bewig discusses may be more technical than your work with spreadsheets requires, but by going through the whole article, you will be alerted to issues you need to be aware of, and you will set yourself up for gradually increasing your spreadsheet skills.
21st Century Journalism XXVII: Digging for Business Info
At the website of the Society of Professional Journalists, Glenn Lewin, a freelance writer, reporter, and researcher, provides a detailed list of tips (here condensed and slightly edited) for gathering information about a particular business enterprise:
Work from the outside in, peeling back the “layers of the onion.” "The most solid and reliable information is obtained (and verified) through a variety of sources."
Conduct documents and public records searches. I.e., check out past litigation, property records, etc.
Develop multiple sources within the target company. "Constantly look for fresh sources; it’s a mistake to continually tap the same sources. ... Know who in the organization has information, and what information they have."
Seek information sources from outside the company, such as headhunters, industry consultants, and former employees (especially people from the sales and marketing departments).
Become familiar with the company’s physical location and business activity. "If, for example, the business claims to be a distributor, but operates out of a small office, is it really just a mail-drop operation posing as a stocking distributor?"
Generate referrals — both from inside and outside the company. "Managers [and] key decision-makers are often more accessible if approached with a referral."
Employ investigative interviewing techniques. E.g.: "Build bridges by looking for people and interests you may have in common ... Stay alert for information that doesn’t seem to fit or to make sense..."
Leverage information / trade information. "... use what you know to obtain still more information. Understand that information is not a one-way street. Be willing to share information with your sources; [this] creates trust, costs nothing, and demonstrates that you are thinking of their needs as well as your own."
Know who your target company does business with. "Important information may be obtained from the customers and vendors ..."
Adopt and maintain the proper attitude. "The best investigators are open-minded, diligent, thorough, creative and — above all — persistent."
Having watched with a good deal of dismay the poor use of sources that seems endemic in today's journalism, I would particularly echo Lewin's insistence on tapping a variety of sources, and constantly developing new sources. This advice, which I'd supplement by noting that becoming too buddy-buddy with official sources detracts from one's journalistic independence, applies to all beats, not just business.
It is easy to get confused about how freer trade affects prices. People are inclined to say that it will lower prices — absolute prices — whereas the actual impact is on relative prices: Imports become relatively cheaper and exports relatively more expensive. The impact on any particular individual depends on the particular mix of imported and exported goods the individual consumes.
This is explained neatly by Dani Rodrik, a professor of international political economy at Harvard's Kennedy School of Government, in an April 2007 blog post.
About a year ago, I wrote a post that mentioned John Boyd (1927 - 1997), a US Air Force pilot, military strategist, and fighter aircraft tactician, as an example of someone who spoke out consistently against the negative effects of careerism on the military.
Along the same lines, this past April Robert Gates, the US Secretary of Defense, cited Boyd as "a historical exemplar" that today's officers would do well to emulate in order to make substantial contributions to meeting the Air Force's pressing need to become more strategically adaptable.
Gates notes that Boyd
had to overcome a large measure of bureaucratic resistance and institutional hostility.
He had some advice that he used to pass on to his colleagues and subordinates that is worth sharing with you. Boyd would say — and I quote — "One day you will take a fork in the road, and you're going to have to make a decision about which direction you want to go. If you go one way, you can be somebody. You will have to make compromises, and you will have to turn your back on your friends. But you will be a member of the club, and you will get promoted and get good assignments. Or you can go the other way, and you can do something, something for your country and for your Air Force and for yourself. If you decide to do something, you may not get promoted, and you may not get good assignments, and you certainly will not be a favorite of your superiors, but you won't have to compromise yourself. To be somebody or to do something. In life there is often a roll call. That's when you have to make a decision: to be or to do."
For the kinds of challenges America faces and will face, the armed forces will need principled, creative, reform-minded leaders, men and women who, as Boyd put it, want to do something, not be somebody.
Gates devoted the rest of his remarks to further elaboration of his view that an "unconventional era of warfare requires unconventional thinkers." In the question-and-answer session that followed his remarks, he suggested that "the biggest challenge for out-of-the-box thinking is the wisdom of the senior leader who sees the value of that kind of thinking and protects it and the people who do it." I.e., the way to resolve the tension between people seeking to build reasonably secure careers for themselves, and speaking up in dissent when that's what circumstances require, is for senior leaders to make their organizations safe for unconventional thinking.
The Associated Press published an article on June 8 that provides a look at how "standardized patients" are used to help medical students hone and demonstrate their clinical skills. As enumerated by Cafe Nicholas, the director of the Standardized Patient Program at the University of Vermont's medical school, these clinical skills include how "you present yourself to a patient — communication-interpersonal skills, history taking skills, physical exam skills, clinical reasoning."
The website of the Association of Standardized Patient Educators defines a standardized patient as
a person who has been carefully coached to simulate an actual patient so accurately that the simulation cannot be detected by a skilled clinician. In performing the simulation, the SP presents the gestalt of the patient being simulated; not just the history, but the body language, the physical findings, and the emotional and personality characteristics as well.
What the AP article doesn't cover is the four decades of effort that lie behind today's widespread use of standardized patient methodology for medical training and evaluation. You can read that informative history (through the mid-'90s) here (pdf). A key point is that the methodology was and, in some quarters, still is, met with skepticism. It took its advocates many years to build support through hands-on demonstrations across North America and documentation of training and evaluation outcomes.
To pick up an additional dimension of the story, you can read a savvy account of the standardized patient experience from the point of view of the person playing the patient here.
Having written several previous posts on how Toyota operates (see, for example, here, here, and here), I want to note what Hirotaka Tekeuchi, Emi Osono, and Norihiko Shimizu, all of Hitotsubashi University's Graduate School of International Corporate Strategy in Tokyo, have to say about the company in the June issue of the Harvard Business Review.
Tekeuchi, Osono, and Shimizu (TOS) report conclusions they have drawn from six years of research into how Toyota is run. They argue that the fundamental source of the company's long-time success is its "culture of contradictions," what I would call handling paradox with finesse, something which I have always thought is an essential part of sophisticated management.
TOS say that Toyota "deliberately fosters contradictory viewpoints within the organization and challenges employees to find solutions by transcending differences rather than resorting to compromises." The result is ongoing innovation that maintains the company's competitive strength.
TOS identify six forces that create contradictions at Toyota. There are three forces of expansion that drive toward change and improvement, but also complicate decision making and challenge the company's control systems:
Tough goals
Local customization
Experimentation
Modulating the forces of expansion by stabilizing the company, helping employees make sense of the environment in which they operating, and perpetuating Toyot's values and culture, are three forces of integration:
Values from the founders — Prime examples of these values are continuous improvement, respect for people and their capabilities, teamwork, humility, putting the customer first, seeing things firsthand.
Up-and-in people management — People who fall short of performance requirements are provided with help in enhancing their capabilities (as opposed to being fired, as would happen in an up-or-out model).
Open communication — This is promoted through disseminating know-how laterally, giving people the freedom to voice contrary opinions, having frequent face-to-face interactions, making tacit knowledge explicit, and creating support mechanisms for disseminating best practices and company values. These support mechanisms include the Toyota Institute, the Global Knowledge Center, and the University of Toyota. Also included are informal employee groups, such as committees, study groups, and social groups.
TOS argue that employees working within Toyota's culture — in which the contradictions listed above are fostered — accumulate invaluable chie — the wisdom of experience. They also argue that the difficulty other companies have in emulating Toyota arises from trying to copy specific practices, rather than building a comparable organizational culture.
The above summary naturally leaves out most of the details contained in the TOS article, so if you want to get a fuller picture of what they are reporting, by all means read the article in its entirety.
Brown's thesis is that by practicing design thinking — "a discipline that uses the designer's sensibility and methods to match people's needs with what is technologically feasible and what a viable business strategy can convert into customer value and market opportunity" — firms structure their innovation efforts in a way that maximizes the productivity of those efforts, not to mention in a way that meets people's needs better and solves problems better. Since innovation is increasingly the basis for growth in developed economies, handling the innovation process well is crucial to firms' success in countries like the US, Germany, and Japan.
Brown explains the three elements of design thinking:
Inspiraton — Put together a multidisciplinary team (e.g., engineering, marketing IT), and have the team address questions like: What's the business problem? Where's the opportunity? What has changed (or may soon change)? How can we enhance this product (or experience or service)? It is essential to use direct observation of consumers to develop a deep understanding of their needs and preferences. What you're looking for in this phase are fresh insights that can be the basis for successful innovation.
Ideation — The process of generating, developing, and testing ideas that may led to solutions to the problem or opportunity. Test variations of an idea through rapid prototyping. "The goal of prototyping isn't to finish. It is to learn about the strengths and weaknesses of the idea and to identify new directions that further prototypes might take." The team seeks feedback on each prototype from interested parties.
Implementation — Charting a path to market. This is the phase in which a business strategy is formulated and communicated to the rest of the organization. (You can read more about Brown's views on strategy formulation here.)
Note that the process outlined above is iterative. The team can expect to circle back through all three phases, especially phases 1 and 2.
Design thinking is a complement to analytical thinking, which is data- and planning-based. Although Brown does not describe the training in design thinking provided to the individuals participating in the case situations he describes in his article, it is clear that teachability is not an issue as far as he's concerned. He mentions holding workshops to teach the fundamental concepts, and he recommends having design thinkers experience all three phases of the process, which will help them build judgment over time.
I was prompted by an article on "design thinking" in the June issue of the Harvard Business Review to see what more I could learn about just what "design thinking" is — something the HBR article does not make entirely clear.
David Kelley, founder of IDEO, professor of mechanical engineering at Stanford's Hasso Plattner Institute of Design, and the man most associated with the promotion of teaching businesspeople design thinking, is the obvious source to turn to. In a 2006 interview with writer Andrew Blum, Kelley explains one of the three key aspects of design thinking as follows:
Instead of feeling that you know it all, that you’re the expert in the subject, design thinking also means being humble and questioning it. Many of the people who are designing things today are “experts” which means they’re looking for ideas from that “expert” viewpoint. But design thinking is much more about going out into the world not having a point of view and just finding these latent needs that are obvious, but only when you look with no agenda. With design thinking we try to get in the right general area first rather than just accepting what the problem is. We’re more experimental and less calculating. It’s optimistic. We thrive on the creative challenges rather than the obstacles. And it’s more intuitive, or empathetic, or however you want to say it. All this ends up being really cathartic for people who do nothing but analytical thinking!1
Kelley goes on to allude to a second key aspect of design thinking — rapid prototyping and iterative homing in on the best solution to whatever innovation challenge a team is addressing.
In this particular interview, Kelley does not mention the third aspect of the design thinking methodology — implemention — but implementation does get full attention in the aforementioned HBR article, which will be the subject of tomorrow's post. In the meantime, you can review here an excellent case stduy of how the Institute of Design (aka the d.school) applies the design thinking methodology.
__________ 1 It is important to note that not everyone agrees that "design thinking" is a clearly defined concept. See, for example, this article in the May issue of Metropolis.
There seem to be plenty of places where one can find guidelines for brainstorming, but in my experience, expert advice on how to evaluate the ideas generated is less common. A few days ago I came upon an essay by Scott Berkun, self-styled "expert in project management, creative thinking and managing people," that is quite useful.
Berkun's essay is geared to designers, but his guidelines and tips are generally applicable to any team working on developing innovative products and/or services. I recommend reading the entire essay. To give you the flavor of what you'll find, here (in somewhat edited form) are the "general rules of order" Berkun suggests:
Start with clarifying questions. Clarify any assumptions about what the presented design is intended to do, or what kind of experience it is intended to create. Hopefully, this intent is derived from the overall project goals, which is already agreed upon.
Listen before speaking. Many times in work environments, we confuse conversations, which should be exchanges of ideas, with opportunities to inflict our opinions on others. If you take a moment to listen and understand before voicing an opinion, you’re open to hear something new that might challenge your old thinking. So don’t just wait for other people to finish; actively try to understand what’s being said, and reflect it back to the speaker.
Lead into explorations of alternatives. Ask questions that surface other choices the designer might not have recognized. Postpone judgments, unless there are obvious gaps between the designer's intent, and the designs you are critiquing.
If it fits with the goals of the critique, point out situations, sequences, or elements within the design that may be problematic given what you know about your customers, the scenarios involved, or the project goals.
Avoid statements that refer to absolutes (e.g., "This is dumb and ugly"). Instead, make points that relate to the goals of the design (e.g., "If the goal is to make this feel friendly, black and flaming red doesn’t convey that to me”).
It’s fine to have a personal opinion, expressing your own preferences, but don’t confuse this with your perception of what your customers need or want. I.e., make sure to specify which of these two kinds of opinion you’re offering. Hopefully there are data and research to help everyone agree on the likely customer perspective on different ideas.
Berkun concludes his discussion of the critique meeting proper (he has some further thoughts concerning pre- and post-meeting work and frequency of meetings) by noting that the meeting "should feel like an informal conversation between people with the same goals, all trying to explore and surface good thinking. The person running the meeting has the responsibility of setting the right tone for this, preferably by example, and doing everything in their power to maintain that attitude and spirit in the room throughout the meeting."
Though reading an article about Tom Rath's 2006 book, Vital Friends: The People You Can't Afford to Live Without did not make me want to run out and buy the book, it did encourage me to air one of my pet ideas, namely that making friends among work colleagues is an entirely acceptable thing to do. The contrary view — that on-the-job relationships should be at arm's length — has never seemed reasonable to me.
The Gallup organization, where Rath heads Workplace and Leadership Consulting, has compiled evidence indicating that friends at work are not only acceptable, but they are, in fact, beneficial to all concerned. You can read Gallup's own summary of Rath' book here. Key findings, from my point of view:
"Although most companies don't encourage, and some outright forbid, close relationships between workers, Gallup [finds] that [having] close friendships at work boosts employee satisfaction by almost 50%."
"Spending time with your boss was rated as the least pleasurable time of the day. However, when employees do have close friendships with their boss, they are more than twice as likely to be satisfied with their jobs."
"You are three times as likely to have a close-knit workgroup if [the] physical environment makes it easy to socialize. Unfortunately, only one-third of the people [Gallup] studied report working in such an environment."
I would just add that I have never hesitated to make friends with congenial colleagues, and this has always worked out fine.
I recently had to pull together tips for raising an issue with a customer when the customer is, at least to a degree, at fault. My suggestions ...
Think about the person you’ll be speaking with and match your approach to their preferred communication style.
Keep notes of conversations. It is often good to follow up a conversation with an email to the other parties summarizing significant information and any agreements reached.
Encourage commitment to a specific course of action by finding out what is necessary for a Yea or Nay from the customer.
If you need to follow up on something that seems not to be happening as agreed, you may want to develop an additional reason to contact the other party. For example, you might combine your reminder with a clarifying question or an update about work your company is doing for the customer.
If you need to correct a customer’s misunderstanding or wrong information, do so tactfully.
A good rule of thumb is to think twice before starting a comment with “You ...”
If you know for sure that what you are thinking of saying is correct — e.g., “You agreed in your email on the 12th that we’d change the deadline to the 30th.” — that factual statement can be fine, so long as it’s couched in a neutral tone.
On the other hand, it may be preferable to be indirect, especially if you’re talking about a customer mistake. For example, you might say, “Somehow, this wasn’t what I was expecting. Let’s look at it together.”
If what you’re thinking of saying suggests you are able to read the other person’s mind — e.g., “You want to skip an important step.” — it’s usually better to revise your remark to get rid of what can come across as an accusation. Often, the best approach is simply to ask the person for their view of the issue instead of jumping to the conclusion that you already know what their view is.
Note that this advice applies with minimal modification to interactions with anyone with whom you need to maintain a solid working relationship.
If you want a convenient way of organizing information from various websites you visit while researching a topic, Google Notebook (in beta) can help. As explained in the FAQ, "With Google Notebook, you can browse, clip, and organize information from across the web in a single online location that's accessible from any computer. ... You won't ever have to leave your browser window." All text information in your notebooks is searchable.
To use Google Notebook, you need to download a browser extension; there are versions for Internet Explorer 6 and Firefox 1.5+.
To familiarize yourself with Google Notebook, you can take a brief tour.
In their book, Prahalad and co-author M.S. Krishnan, professor of business information technology at Ross, argue that companies that are successful into the future will be co-creating value with their customers, individualizing to meet particular customers' preferences. This is in contrast to the traditional form of innovation, in which a company first creates a new product or service and then turns its attention to selling it more or less as is to customers. Another key prong of their argument is that optimizing production will require accessing a global network of resources.
A brief BusinessWeek review of The New Age of Innovation is here.
Frédéric Bastiat Would Have Done Well on "The Daily Show"
The Frenchman Frédéric Bastiat (1801-1850), was a popularizer of economic theory (and a politician) who devoted considerable energy to making fun of illogical thinking about economic issues. A particularly famous instance of his wit is the "Petition of the Candlemakers," Chapter 7 of the first series of Bastiat's Sophismes Èconomiques, published in 1845. In this essay, Bastiat mocks trade protectionists ...
A petition from the manufacturers of candles, tapers, lanterns, sticks, street lamps, snuffers, and extinguishers, and from producers of tallow, oil, resin, alcohol, and generally of everything connected with lighting
To the Honourable Members of the Chamber of Deputies.
Gentlemen: You are on the right track. You reject abstract theories: abundance and affordable prices do not much worry you. You concern yourselves mainly with the fate of the producer. You wish to free him from foreign competition, that is, to reserve the domestic market for domestic industry.
We come to offer you a wonderful opportunity for your — what shall we call it? Your theory? No, nothing is more deceptive than theory. Your doctrine? Your system? Your principle? But you dislike doctrines, you have a horror of systems, as for principles, you deny that there are any in political economy; therefore we shall call it your practice — your practice without theory and without principle.
We are suffering from the ruinous competition of a rival who apparently works under conditions so far superior to our own for the production of light that he is flooding the domestic market with it at an incredibly low price; for, the moment he appears, our sales cease, all the consumers turn to him, and a branch of French industry whose ramifications are innumerable is all at once reduced to complete stagnation. This rival, which is none other than the sun, is waging war on us so mercilessly we suspect he is being stirred up against us by perfidious Albion [England] (excellent diplomacy nowadays!), particularly because he has for that haughty island a respect that he does not show for us. {England is often foggy and overcast.]
We ask you to be so good as to pass a law requiring the closing of all windows, dormers, skylights, inside and outside shutters, curtains, casements, bull's-eyes, deadlights, and blinds — in short, all openings, holes, chinks, and fissures through which the light of the sun is wont to enter houses, to the detriment of the fair industries with which, we are proud to say, we have endowed the country, a country that cannot, without betraying ingratitude, abandon us today to so unequal a combat.
Be good enough, honourable deputies, to take our request seriously, and do not reject it without at least hearing the reasons that we have to advance in its support.
First, if you shut off as much as possible all access to natural light, and thereby create a need for artificial light, what industry in France will not ultimately be encouraged?
If France consumes more tallow, there will have to be more cattle and sheep, and, consequently, we shall see an increase in cleared fields, meat, wool, leather, and especially manure, the basis of all agricultural wealth.
If France consumes more oil, we shall see an expansion in the cultivation of the poppy, the olive, and rapeseed. These rich yet soil-exhausting plants will come at just the right time to enable us to put to profitable use the increased fertility that the breeding of cattle will impart to the land.
Our moors will be covered with resinous trees. Numerous swarms of bees will gather from our mountains the perfumed treasures that today waste their fragrance, like the flowers from which they emanate. Thus, there is not one branch of agriculture that would not undergo a great expansion.
The same holds true of shipping. Thousands of vessels will engage in whaling, and in a short time we shall have a fleet capable of upholding the honour of France and of gratifying the patriotic aspirations of the undersigned petitioners, chandlers, etc.
But what shall we say of the specialities of Parisian manufacture? Henceforth you will behold gilding, bronze, and crystal in candlesticks, in lamps, in chandeliers, in candelabra sparkling in spacious emporia compared with which those of today are but stalls.
There is no needy resin-collector on the heights of his sand dunes, no poor miner in the depths of his black pit, who will not receive higher wages and enjoy increased prosperity.
It needs but a little reflection, gentlemen, to be convinced that there is perhaps not one Frenchman, from the wealthy stockholder of the Anzin Company to the humblest vendor of matches, whose condition would not be improved by the success of our petition.
We anticipate your objections, gentlemen; but there is not a single one of them that you have not picked up from the musty old books of the advocates of free trade. We defy you to utter a word against us that will not instantly rebound against yourselves and the principle behind all your policy.
Will you tell us that, though we may gain by this protection, France will not gain at all, because the consumer will bear the expense?
We have our answer ready:
You no longer have the right to invoke the interests of the consumer. You have sacrificed him whenever you have found his interests opposed to those of the producer. You have done so in order to encourage industry and to increase employment. For the same reason you ought to do so this time too.
Indeed, you yourselves have anticipated this objection. When told that the consumer has a stake in the free entry of iron, coal, sesame, wheat, and textiles, "Yes," you reply, "but the producer has a stake in their exclusion." Very well, surely if consumers have a stake in the admission of natural light, producers have a stake in its interdiction.
"But," you may still say, "the producer and the consumer are one and the same person. If the manufacturer profits by protection, he will make the farmer prosperous. Contrariwise, if agriculture is prosperous, it will open markets for manufactured goods." Very well, If you grant us a monopoly over the production of lighting during the day, first of all we shall buy large amounts of tallow, charcoal, oil, resin, wax, alcohol, silver, iron, bronze, and crystal, to supply our industry; and, moreover, we and our numerous suppliers, having become rich, will consume a great deal and spread prosperity into all areas of domestic industry.
Will you say that the light of the sun is a gratuitous gift of Nature, and that to reject such gifts would be to reject wealth itself under the pretext of encouraging the means of acquiring it?
But if you take this position, you strike a mortal blow at your own policy; remember that up to now you have always excluded foreign goods because and in proportion as they approximate gratuitous gifts. You have only half as good a reason for complying with the demands of other monopolists as you have for granting our petition, which is in complete accord with your established policy; and to reject our demands precisely because they are better founded than anyone else's would be tantamount to accepting the equation: + x + = -; in other words, it would be to heap absurdity upon absurdity.
Labour and Nature collaborate in varying proportions, depending upon the country and the climate, in the production of a commodity. The part that Nature contributes is always free of charge; it is the part contributed by human labour that constitutes value and is paid for.
If an orange from Lisbon sells for half the price of an orange from Paris, it is because the natural heat of the sun, which is, of course, free of charge, does for the former what the latter owes to artificial heating, which necessarily has to be paid for in the market.
Thus, when an orange reaches us from Portugal, one can say that it is given to us half free of charge, or, in other words, at half price as compared with those from Paris.
Now, it is precisely on the basis of its being semigratuitous (pardon the word) that you maintain it should be barred. You ask: "How can French labour withstand the competition of foreign labour when the former has to do all the work, whereas the latter has to do only half, the sun taking care of the rest?" But if the fact that a product is half free of charge leads you to exclude it from competition, how can its being totally free of charge induce you to admit it into competition? Either you are not consistent, or you should, after excluding what is half free of charge as harmful to our domestic industry, exclude what is totally gratuitous with all the more reason and with twice the zeal.
To take another example: When a product — coal, iron, wheat, or textiles — comes to us from abroad, and when we can acquire it for less labour than if we produced it ourselves, the difference is a gratuitous gift that is conferred upon us. The size of this gift is proportionate to the extent of this difference. It is a quarter, a half, or three-quarters of the value of the product if the foreigner asks of us only three-quarters, one-half, or one-quarter as high a price. It is as complete as it can be when the donor, like the sun in providing us with light, asks nothing from us. The question, and we pose it formally, is whether what you desire for France is the benefit of consumption free of charge or the alleged advantages of onerous production. Make your choice, but be logical; for as long as you ban, as you do, foreign coal, iron, wheat, and textiles, in proportion as their price approaches zero, how inconsistent it would be to admit the light of the sun, whose price is zero all day long! [link added]
[Source: Website of Bill Phillips, associate professor of economics at the University of Maine. (The beginning of the essay has been slightly edited.) The original French text can be found here.]
A Latvian friend alerted me to this animated short that presents 800 years of Latvian history in slightly less than nine minutes.
The short was produced by Animacijas Brigade (Animation Brigade) in Riga. The Latvian Embassy in Washington provides a synopsis of Latvian history in English which you can use to help follow the events depicted in the film.
