Sunday, December 15, 2013
Friday, October 25, 2013
Even though most management systems focus on individual performance, it’s critical to reward and recognize your team collectively. As a team manager, support the right group behaviors by:
Adapted from “How to Reward Your Stellar Team,” by Amy Gallo.
- Encouraging collaboration. Talk about your people as a team, not as a set of individuals. Instead of talking about individuals’ contributions, praise the common behaviors that contribute to the team’s overall success.
- Evaluating team performance. Every six months or so, take a close look at the group’s progress. Don’t mention individuals in this appraisal but focus on what the team has done—and can do—together.
- Using rewards. If you are able, tie a portion of your organization’s discretionary compensation to team performance. If you don’t control the purse strings, try recognizing your team’s hard work in a public way—through a departmental email or even displaying their picture in a common space—or giving them exposure to senior leaders.
Adapted from “How to Reward Your Stellar Team,” by Amy Gallo.
Saturday, October 19, 2013
For decades, strategy gurus have been telling firms to differentiate. From Michael Porter to Costas Markides and through the Blue Oceans of Kim and Mauborgne, strategy scholars have been urging executives to distinguish their firm’s offerings and carve out a unique market position. Because if you just do the same thing as your competitors, they claim, there will be nothing left for you than to engage in fierce price competition, which brings everyone’s margins to zero – if not below.
Yet, at the same time, we see many industries in which firms do more or less the same thing. And among those firms offering more or less the same thing, we often see very different levels of success and profitability. How come? What explains the apparent discrepancy?
To understand this, you have to realise that the field of Strategy arose from Economics. The strategy thinkers who first entered the scene in the 1980s and 90s based their recommendations on economic theory, which would indeed suggest that, as a competitor, you have to somehow be different to make money. Over the last decade or two, however, we have been seeing more and more research in Strategy that builds on insights from Sociology, which complements the earlier economics-based theories, yet may be better equipped to understand this particular issue.
Consider, for example, the case of McKinsey. Clearly, McKinsey is a highly successful professional services firm, making rather healthy margins. But is their offering really so different from others, like BCG, or Bain? They all offer more or less the same thing: a bunch of clever, reasonably well-trained analytical people wearing pin-striped suits and using a problem-solving approach to make recommendations about general management problems. McKinsey’s competitive advantage apparently does not come from how it differentiates its offering.
The trick is that when there is uncertainty about the quality of a product or service, firms do not have to rely on differentiation in order to obtain a competitive advantage. Whether you’re a law firm or a hairdresser, people will find it difficult – at least beforehand – to assess how good you really are. But customers, nonetheless, have to pick one. McKinsey, of course, offers the most uncertain product of all: Strategy advice. When you hire them – or any other consulting firm – you cannot foretell the quality of what they are going to do and deliver. In fact, even when you have the advice in your hands (in the form of a report or, more likely, a powerpoint “deck”), you can still not quite assess its quality. Worse, even years after you might have implemented it, you cannot really say if it was any good, because lots of factors influence firm performance, and whether the advice helped or hampered will forever remain opaque.
Research in Organizational Sociology shows that when there is such uncertainty, buyers rely on other signals to decide whether to purchase, such as the seller’s status, its social network ties, and prior relationships. And that is what McKinsey does so well. They carefully foster their status by claiming to always hire the brightest people and work for the best companies. They also actively nurture their immense network by making sure former employees become “alumni” who then not infrequently end up hiring McKinsey. And they make sure to carefully manage their existing client relationships, so that no less than 85 percent of their business now comes from existing customers.
Status, social networks, and prior relationships are the forgotten drivers of firm performance. Underestimate them at your peril. How you manage them should be as much part of your strategizing as analyses of differentiation, value propositions, and customer segments.
Monday, October 7, 2013
Think of it this way: There are two kinds of failure. The first comes from never trying out your ideas because you are afraid, or because you are waiting for the perfect time. This kind of failure you can never learn from, and such timidity will destroy you. The second kind comes from a bold and venturesome spirit. If you fail in this way, the hit that you take to your reputation is greatly outweighed by what you learn. Repeated failure will toughen your spirit and show you with absolute clarity how things must be done. In fact, it is a curse to have everything go right on your first attempt. You will fail to question the element of luck, making you think that you have the golden touch. When you do inevitably fail, it will confuse and demoralize you past the point of learning. In any case, to apprentice as an entrepreneur you must act on your ideas as early as possible, exposing them to the public, a part of you even hoping that you’ll fail. You have everything to gain.
- Via Mastery
Thursday, October 3, 2013
You have a new innovation under way, but things aren’t going well. You find yourself at a crossroads: carry on, or jump ship? It’s always a tough call. But if you haven’t experienced any pleasant surprises in a long time — say, something took far less time than anticipated, or you came across a new but unexpected design enhancement, among other scenarios — take pause. And if you’re not gaining any new insights, it’s time to reassess. Finally, if you also notice a lack of enthusiasm from team members, customers, and/or clients, kill the idea. Bad things, remember, come in threes.
The rat race begins well before a lot kids graduate from college — extracurricular activities, internships, you name it — everyone has an eye toward securing the best career. But not everyone is lucky enough to beef up their résumés with eye-catching credentials; instead, many college students work in retail or in food service, among other jobs that they may not plan on doing for the long haul. Yet, these experiences can still be very valuable. Working with a diverse group of people, for example, can help pop your ego-centric bubble, among many other things. It’s something we all have to keep in mind: not every experience has to fit so nicely into a career narrative. Sure, it’s important to enhance a résumé, but it’s more important to grow as a person.
Monday, September 30, 2013
When people feel connected to you, even difficult conversations feel less threating. Here are three tips to forge stronger bonds with your employees:
- Relate whenever you can. View every interaction as an opportunity to get to know someone a little better. Make a habit of asking employees one question about their work or their personal lives each time you encounter them.
- Take note of subtleties. People seek emotional connection through countless small “bids” for attention—questions, gestures, or looks. Take stock of how much you notice these cues . You might also solicit some feedback from friends and family on how well you listen and respond to social cues in general.
- Regularly express appreciation. Research shows that the ratio of positive to negative interactions is 5:1 in a successful relationship. You don’t need to pay someone five compliments before offering criticism, but do be mindful of the ratio.
Adapted from the HBR Guide to Coaching Your Employees.