Monday 16 March 2009
Short story
New this month, a short story about an employee who took home a personality questionnaire from a course with unexpected consequences for his marriage and his job! Please click here to access.
Moon Shots for Management, by Gary Hamel, Harvard Business Review, February 2009
Any article by Gary Hamel should be of interest, not least because he has been voted by the Wall Street Journal as the world’s number one business expert, and because his books ‘Leading the Revolution’ and ‘Competing for the Future’ are among the best selling management books in recent times. (Interestingly the ‘top 100’ book, reviewed below, includes the latter but not the former.)
It is true that Hamel’s reputation took a bit of a hammering when he quoted Enron as the modern business model that others should be striving for, but he seems to have survived this setback. This article follows a forum of a group of about 35 experts, claiming to be world’s premier management thinkers, including business school professors, senior management consultants and (surprisingly few) company executives.
Their brief was to ‘re-invent management’ and Hamel’s article lists and describes the 25 ‘Moon Shots’, the term they developed for the key topics and issues that need to be addressed if management thinking is to undergo the required transformation. This feels as if it has the potential to be exciting but, as you read through the list, there seems to be rather too many clichés that are not at all new, for example, expand autonomy, embrace diversity, develop holistic performance measures etc.
My main criticism however is Hamel’s rather lazy approach to the article which is just to list and briefly describe all 25, without any attempt to cluster and structure, and without providing a meaningful conceptual framework, surely what someone with his reputation ought to be able to do. It just reads like a disjointed and overlapping shopping list and this emphasises the cliché ridden nature of many of the ‘moon shots’.
I have made an attempt at a summary as shown below, which will hopefully help those who would like to impress others with a broad awareness of how, according to these alleged gurus, management is to be reinvented. I detected five main themes, leaving out one or two points that are either indecipherable or too much of a cliché:
It is true that Hamel’s reputation took a bit of a hammering when he quoted Enron as the modern business model that others should be striving for, but he seems to have survived this setback. This article follows a forum of a group of about 35 experts, claiming to be world’s premier management thinkers, including business school professors, senior management consultants and (surprisingly few) company executives.
Their brief was to ‘re-invent management’ and Hamel’s article lists and describes the 25 ‘Moon Shots’, the term they developed for the key topics and issues that need to be addressed if management thinking is to undergo the required transformation. This feels as if it has the potential to be exciting but, as you read through the list, there seems to be rather too many clichés that are not at all new, for example, expand autonomy, embrace diversity, develop holistic performance measures etc.
My main criticism however is Hamel’s rather lazy approach to the article which is just to list and briefly describe all 25, without any attempt to cluster and structure, and without providing a meaningful conceptual framework, surely what someone with his reputation ought to be able to do. It just reads like a disjointed and overlapping shopping list and this emphasises the cliché ridden nature of many of the ‘moon shots’.
I have made an attempt at a summary as shown below, which will hopefully help those who would like to impress others with a broad awareness of how, according to these alleged gurus, management is to be reinvented. I detected five main themes, leaving out one or two points that are either indecipherable or too much of a cliché:
- Broader holistic goals, incorporating longer term achievement and values, not just those of shareholders
- Need to be more fast moving and flexible, with greater openness of communication channels
- Leadership will need to inspire and create passion among their employees to retain them
More trust, autonomy and empowerment - Greater scope for individuals to show innovative qualities outside the organisation structure
As I read the moon shots relating to the last two bullets, I wondered what planet they were on, whether in fact they had reached the moon! Were there any bankers in the room, had anyone heard of the autonomy, trust and innovation that led to the fraudulent bundling and selling of sub-prime mortgages and other complex innovations? Autonomy and light touch regulation have been major contributors to the recession and the banking crisis..
In fairness to Hamel, he does mention this conflict later in his article but rather than suggesting that maybe this part of the work has been overtaken by events, he argues that the problem is more about creating the right incentives and accountability. I wonder.
This article is worth reading - or at least the quick synopsis that is contained in the middle of the text - because it allows anyone involved in management learning to show awareness of the thinking going on in business schools and consultancies. But you might find that, like me and my colleagues at MTP, it is hard to be impressed.
Storytelling - how to enrich the learning experience, by Sue Lickorish, Training Journal, February 2009
This article confirms that, despite its relatively low level image, the Training Journal does, by inviting learning professionals to share their practical ideas, perform a valuable service.
I am perhaps biased towards a favourable assessment of the article because of my own history of writing business novels, having been inspired by the first and famous example of that genre, The Goal by Goldratt and Cox. The author of this article is discussing stories in more of a formal training course context and our team MTP share many of her views; all our tutors are aware of the power of stories and anecdotes to bring business learning to life.
The author starts with a definition - a story is a sequence of events that occur in a different time and place - and then provides some helpful confirmations of why they are so effective at activating the brain to learn, combining left and right hemispheres. She quotes fifteen ways to use a story - as with Hamel, far too many, writers should follow the rule that going into double figures will almost certainly lose your audience - and makes the valuable point that story-telling can and often does go over the top. How many of us have heard trainers telling too many stories that seem to be for their own benefit, rather than for the purpose of learning?
The author suggests that some trainers tell other people’s personal stories as if the events had happened to them, which raises an interesting ethical dilemma. I have from time to time encouraged other MTP tutors to use my own stories on the basis that it is the learning that matters, but have seen some understandable reluctance; maybe a story is only truly convincing if it is owned by the original teller. I once heard of a business school tutor who was well known for taking other tutors’ anecdotes and after many years couldn’t remember which happened to him anyway!
The article moves on to broader areas than training and mentions the importance of stories to communication in the organisation, suggesting that smokers who congregate together can get information through stories that others will not hear. The author also suggests that pro-active use of stories to communicate values and vision can be more effective than mission statements on printed cards.
Generally the article is well written and helpful in putting into words what many of us experience and believe. Ironically the only time when I lost patience and wanted to skip was when the author told a story about her four year old child. I would like to think that this is because the story was not needed to make the point. But perhaps it’s just me. I always did prefer telling them to hearing them!
I am perhaps biased towards a favourable assessment of the article because of my own history of writing business novels, having been inspired by the first and famous example of that genre, The Goal by Goldratt and Cox. The author of this article is discussing stories in more of a formal training course context and our team MTP share many of her views; all our tutors are aware of the power of stories and anecdotes to bring business learning to life.
The author starts with a definition - a story is a sequence of events that occur in a different time and place - and then provides some helpful confirmations of why they are so effective at activating the brain to learn, combining left and right hemispheres. She quotes fifteen ways to use a story - as with Hamel, far too many, writers should follow the rule that going into double figures will almost certainly lose your audience - and makes the valuable point that story-telling can and often does go over the top. How many of us have heard trainers telling too many stories that seem to be for their own benefit, rather than for the purpose of learning?
The author suggests that some trainers tell other people’s personal stories as if the events had happened to them, which raises an interesting ethical dilemma. I have from time to time encouraged other MTP tutors to use my own stories on the basis that it is the learning that matters, but have seen some understandable reluctance; maybe a story is only truly convincing if it is owned by the original teller. I once heard of a business school tutor who was well known for taking other tutors’ anecdotes and after many years couldn’t remember which happened to him anyway!
The article moves on to broader areas than training and mentions the importance of stories to communication in the organisation, suggesting that smokers who congregate together can get information through stories that others will not hear. The author also suggests that pro-active use of stories to communicate values and vision can be more effective than mission statements on printed cards.
Generally the article is well written and helpful in putting into words what many of us experience and believe. Ironically the only time when I lost patience and wanted to skip was when the author told a story about her four year old child. I would like to think that this is because the story was not needed to make the point. But perhaps it’s just me. I always did prefer telling them to hearing them!
From Mad Management to Man Management, Times 2, by Andrew Billen, Times 2, 9th March
This is the first time the blog has included an article about management from one of the upmarket dailies, because these are few and far between and are often of the shallow variety. This one is no different and only just scraped in to my chosen reviews.
My colleagues might suggest that I am not one to make this criticism but the article does suffer from an excess of cynicism. This is not in itself necessarily a bad thing but in this case the whole article seems to be a premeditated attempt to make fun of management theory. This is betrayed by two columns with headings such as management by cliché, management by acronym and management by numbers, which have no reference to the rest of the article. And the inclusion of leading thinkers like Porter and Deming with the implication that they are charlatans, does not help the author’s credibility.
The thesis of the article is the extent to which the recession is exposing management thinking as ‘jargon-filled sham’. This is a valid theme which could have generated some good argument if it had been backed up by facts and serious opinion, rather than by prejudice and shallow arguments. The author seems to have it in particularly for Tom Peters and ‘the pursuit of wow’ while failing to give him credit for first moving thinking away from hard analysis to the softer aspects of strategy with his first seminal book ‘In Search of Excellence’.
The article traces the development of management theory from its earliest days and quotes the influence of Harvard and its glittering alumni in driving much of the thinking. The author makes one valid point which I have never heard expressed so clearly before; how can an organisation whose whole ethos is based on the study of historical cases claim to equip managers for new situations that have never been encountered before? Our response at MTP - where we use the case method to some extent - is that we would claim to ‘teach out’ of the case and use it to encourage discussion of new situations that the client company might face. But at Harvard and other business schools with a similar ethos, my experience is that they teach deeply into the case and would not normally use it to highlight the specific future scenarios of their audience. I look forward to being challenged on this assumption!
After tracing the history the article tends to meander from one superficial view to another and I found myself agreeing with some points and not others, based on my own experiences and prejudices. I agreed with his view that the McKinsey idea of forced ranking and firing the bottom 10% every year is dangerous nonsense. But I could not agree with his opinion that Key Performance Indicators are invalid because they need good management to operate them.
The author does manage to find one piece of evidence to justify his cynicism, a consultant who left Gemini after co-authoring a book called ‘Transforming the Organisation’ and who now admits that it was all a con to generate consultancy business; anyone who has been in management consultancy will not be surprised by this. But to use this as evidence that all management thinking is a jargon filled sham is many steps too far. I like some cynicism but it should be informed and selective.
My colleagues might suggest that I am not one to make this criticism but the article does suffer from an excess of cynicism. This is not in itself necessarily a bad thing but in this case the whole article seems to be a premeditated attempt to make fun of management theory. This is betrayed by two columns with headings such as management by cliché, management by acronym and management by numbers, which have no reference to the rest of the article. And the inclusion of leading thinkers like Porter and Deming with the implication that they are charlatans, does not help the author’s credibility.
The thesis of the article is the extent to which the recession is exposing management thinking as ‘jargon-filled sham’. This is a valid theme which could have generated some good argument if it had been backed up by facts and serious opinion, rather than by prejudice and shallow arguments. The author seems to have it in particularly for Tom Peters and ‘the pursuit of wow’ while failing to give him credit for first moving thinking away from hard analysis to the softer aspects of strategy with his first seminal book ‘In Search of Excellence’.
The article traces the development of management theory from its earliest days and quotes the influence of Harvard and its glittering alumni in driving much of the thinking. The author makes one valid point which I have never heard expressed so clearly before; how can an organisation whose whole ethos is based on the study of historical cases claim to equip managers for new situations that have never been encountered before? Our response at MTP - where we use the case method to some extent - is that we would claim to ‘teach out’ of the case and use it to encourage discussion of new situations that the client company might face. But at Harvard and other business schools with a similar ethos, my experience is that they teach deeply into the case and would not normally use it to highlight the specific future scenarios of their audience. I look forward to being challenged on this assumption!
After tracing the history the article tends to meander from one superficial view to another and I found myself agreeing with some points and not others, based on my own experiences and prejudices. I agreed with his view that the McKinsey idea of forced ranking and firing the bottom 10% every year is dangerous nonsense. But I could not agree with his opinion that Key Performance Indicators are invalid because they need good management to operate them.
The author does manage to find one piece of evidence to justify his cynicism, a consultant who left Gemini after co-authoring a book called ‘Transforming the Organisation’ and who now admits that it was all a con to generate consultancy business; anyone who has been in management consultancy will not be surprised by this. But to use this as evidence that all management thinking is a jargon filled sham is many steps too far. I like some cynicism but it should be informed and selective.
Better decision-making by Jo Whitehead, Andrew Campbell and Sydney Finkelstein, Management Today, February 2009
The three authors - their background is not quoted but presumably this is Andrew Campbell formerly of LBS and Ashridge - clearly wrote this article to advertise their new book on this topic and good luck to them. It certainly made me want to read the book and it may be reviewed in future blogs.
The article and the book look at the phenomenon of flawed strategic decision making, particularly at senior level, and the reasons for it. As I read it I had a similar feeling to when I read Hamel’s article - wouldn’t the arguments be even more persuasive if related to more topical examples like the acquisition of ABN Amro by RBS or Lloyds decision to acquire HBOS? OK maybe it is too late to research for the book but surely the article could show some recognition of recent devastating parallels that would strengthen their argument? Instead we get the interesting but dated example of Boots move into healthcare in 2000 and acquisitions by Rentokil and M&S in the previous century.
Nevertheless the arguments and the frameworks from the article do provide food for thought and encourage the reader to relate these to current events. The article suggests four reasons for flawed strategic decision-making, what it calls red flag conditions:
The article and the book look at the phenomenon of flawed strategic decision making, particularly at senior level, and the reasons for it. As I read it I had a similar feeling to when I read Hamel’s article - wouldn’t the arguments be even more persuasive if related to more topical examples like the acquisition of ABN Amro by RBS or Lloyds decision to acquire HBOS? OK maybe it is too late to research for the book but surely the article could show some recognition of recent devastating parallels that would strengthen their argument? Instead we get the interesting but dated example of Boots move into healthcare in 2000 and acquisitions by Rentokil and M&S in the previous century.
Nevertheless the arguments and the frameworks from the article do provide food for thought and encourage the reader to relate these to current events. The article suggests four reasons for flawed strategic decision-making, what it calls red flag conditions:
- Misleading experiences, usually a success that makes you think you can do it again (Fred Goodwin’s success with NatWest?)
- Misleading pre-judgments, a similar condition that I found hard to separate from the first one
- Inappropriate self interest, something the decision maker wants for self and not for the business, for example an acquisition to achieve a bigger top job
- Inappropriate attachments (Lord Rayner of M&S apparently bought Brooks Brothers because he liked their clothes!) The latter part of the article moves on to what can be done to avoid the red flags and it is here that it becomes less convincing. They talk about a number of different types of safeguards, the first of which is to establish processes requiring more detailed analysis and research. They also suggest more rather obvious safeguards - debate and challenge, a firm governance framework and good post audit processes. There is an admission that these safeguards will inevitably slow down the speed of decision making, a trade-off that in our experience most companies are constantly trying to balance
But recent events in the financial services sector - as described in recent books about the fall of Bear Sterns and Lehmanns - have shown that autocratic CEOs often rule by fear and have contempt for formal processes. Over the years we have heard of many cases where major strategic decisions - particularly acquisitions - were made at an early stage and the evaluations were later made to fit the decision and comply with the processes.
Therefore the article - and presumably the book - does not address the key issue, how do you limit the powers of CEOs who forget that they are the servants of the shareholders and not the other way round? There is no easy answer but it is more likely to be found in the structure and dynamics of Boards of Directors than in detailed process safeguards.
Where’s the money? by Jane Simms, Director Magazine, February 2009
Our final review is on a financial topic which may be mundane but which is regularly discussed on our courses - the payment of invoices, on time or otherwise. It is also a topic that is important to MTP’s cash flow so anything we can do to educate in this area should pay off for us!!
The issues which regularly come up on our courses are:
The issues which regularly come up on our courses are:
- How far is it right for a company to stretch the credit taken from suppliers as long as possible?
And - How can companies persuade big and powerful customers to pay on time/more quickly
This article is short and limited but it provides some interesting information and makes some valuable points. It first of all describes a development that I had not previously heard of, the launching by the government of a ‘Prompt Payment Code’ in December last year. Those who sign up to it agree to pay invoices on time, give clear guidance to suppliers and encourage good practice - which it is difficult to argue with. The problem is - who will sign up and, if they do, will they comply? And perhaps more important, what is the penalty for failure?
Apparently the signing up and monitoring is being managed by an organisation that I had previously only vaguely heard of - the Institute of Credit Management. Their goal is to get most of the FTSE 100 signed up quite soon and then begin to monitor compliance, not an easy task but one which the government is presumably rewarding them for. However, the article quotes Nick Wilson of Leeds Business School as rejecting the whole idea, quoting similar initiatives in the past and seeing it all as PR spin. I have to confess some sympathy with this view, though I would love to be surprised.
Wilson illustrates the problem of compliance by saying that even now only 40% of companies comply with the requirement in the Companies Act to disclose payment policy and practice. And all our experience of discussing these issues on courses tells us that, in any case, what companies say and what they do in this area can be very different. This is often not because of deliberate policy but because of systems problems and individual actions, which the less powerful small supplier can do little about.
The article does end with some sensible advice for the small business which we would support for all companies; the most important thing is to agree clear terms for all customers, invoice promptly and accurately and chase in a timely and professional way.
On our courses - which are all for larger companies - this is what we advise on the amount of credit that should be taken from suppliers:
- Financially you should take as much credit as possible and, as you are usually the most powerful party, this could be several months
- But the final judgment depends on the longer-term relationship you want to have with each type of supplier, about which you cannot generalise
And of course pay all management training suppliers dead on time!!
The 100 best business books of all time, by Jack Covert and Todd Sattersten, published by Penguin
The main fascination of this book is to count how many of the nominated 100 you have actually read or heard of. My count was 24 read and 35 heard of, which seems rather too few for someone who is ‘in the business’. The natural reaction is to be critical of the list and look for obvious omissions - what, no ‘In Search of Excellence’? - or to scorn some of the inclusions - surely you can’t put ‘7 Habits of Effective People’ in the top 100?
The main benefit is that you can impress others by your knowledge of such a broad range of publications, supported by the excellent two/three page synopses for every one of the 100. More important it provides a great opportunity to check whether there are any important books out there that you should have been reading and need to catch up on. I expect that most of those involved in management learning are like me; we read the books that we come across or hear about rather than having any planned strategy; this book allows us to prepare a plan to fill the gaps.
The synopses are well written, providing the required overview while giving just enough information to make a judgment as to whether the book is worth reading.
The main benefit is that you can impress others by your knowledge of such a broad range of publications, supported by the excellent two/three page synopses for every one of the 100. More important it provides a great opportunity to check whether there are any important books out there that you should have been reading and need to catch up on. I expect that most of those involved in management learning are like me; we read the books that we come across or hear about rather than having any planned strategy; this book allows us to prepare a plan to fill the gaps.
The synopses are well written, providing the required overview while giving just enough information to make a judgment as to whether the book is worth reading.
What would Google do?, by Jeff Jarvis, published by Collins
I hesitate to review a book that I haven’t fully read but in this case I propose to do so. (It is possible to review a book in these circumstances; Evelyn Waugh was once asked why he gave such favourable book reviews for his friends’ books and he replied 'it’s better than reading them!')
I made this selection because it is the sort of book about the modern digital age that I ought to be reading but it is heavy going and I ended up skipping much of the second half, as it became rather repetitive; so often it seems that authors are trying to make the 200 page mark rather than writing only what is necessary.
Nevertheless it is a valuable read with lots of new insights and some explanations of trends that you can see taking place every day of the week. The author is a leading blogger and an obvious extreme fan of Google and he makes no secret of this. His basic theme is that, if you want to look at future trends in a particular business, you should think about the way in which Google would run it; for example, if Google ran a restaurant, the menu would be electronic and you would be able to search for number of past users of each dish, and the responses etc.
Though this theme becomes a little boring and repetitive, it does provide the basis for Jarvis to provide some real insights for a relative dinosaur in these areas like me; here’s a selection:
- Far from discouraging customers from posting complaints on the net, companies should encourage this and make it interactive (he quotes Dell as an example of a company that has transformed its image in this way)
- Conventional advertising will soon be a thing of the past, it’s now about harnessing blogs and twitters and making yourself ‘searchable’
- Google is commodotising everything and it is only the niche players who understand the Internet – who ‘get it’ - that will survive
- Any company in a ‘middleman’ role is doomed to failure as freedom of access and information increases
- Companies who try to stifle information and open exchange of data will always end up losing; he contrasts EMI’s attempts to stop illegal downloading of music with Apple’s strategy of embracing it as a strategic opportunity
Interestingly he quotes Apple as an example of a company who has in other ways broken the mould by not being open to complaints and not encouraging ‘bottom up’ interactivity. His explanation is that Apple is just so good that it can make strategies work that others cannot.
The book ends with an interesting debate about the extent to which ‘Googling’ is replacing reading as the main source of knowledge. He quotes a number of ‘old fashioned’ thinkers who still believe that the book is here to stay, that it encourages long periods of study and thus deep thinking. Jarvis favours the more ‘modern’ view that learning is better if it is focussed and takes place in short bursts.
My view is that this is a false dichotomy anyway, that it is not ‘either/or’. There will be people and topics that suit one approach or the other but most of us will happily embrace the best of both worlds.