Wednesday, June 16, 2010

Recalling the Learning Knights

One place this blog returns to again and again is the intersection between human capital and social capital. Workers who share more - who get together to collaborate, socialize, even argue and work through differences - tend to trust each other more, and that opens the door to better and more creative cooperation. And, as we have argued so often here, ingenuity and inventiveness come from collaboration, not solitary effort. You also want, we have pointed out, workers who can engage in productive arguments. Push overs, yes men, sycophants and conformists won't help your organization attack challenges. Firms need people who can analyze a problem, formulate a response, defend that response against alternate approaches, and, when confronted with better ideas, acknowledge those ideas and work to construct viable and robust solutions that weave together the best elements of several proposals. Only rigorous and confident thinkers can do this.

We were reminded of this by an article in the New York Times, written by Wes Davis, a writer and former English professor at Yale. Davis' essay, The 'Learning Knights' of Bell Telephone, is about a program offered by Bell Telephone in the late 1950s, called the Institute of Humanistic Study for Executives. The program was ambitious - a 10 month long series of lectures, course work and reading assignments, designed to create employees who were "capable of guiding the company rather than simply following instructions or responding to obvious crises."

The Graham School has offered programs with similar goals. Innovative leaders at approached us several years ago to offer a program that, while less far-reaching than the Bell Telephone program Davis writes about, brought University of Chicago instructors into the Careerbuilder offices every month, to teach seminars on Shakespeare's Henry V, Plato, Walt Whitman's Leaves of Grass, Einstein's Relativity: The Special and the General Theory, and other unlikely readings for a Friday afternoon at work. Careerbuilder's CEO believed it would help his employees think clearly and more attentively if they were exposed to "great thinkers, thinking at the top of their games." It also, I would point out, brought employees from all across the firm's landscape together for a few hours each month, creating contacts, friendships, and working arrangements that might not have otherwise existed.

Our Leadership Arts Certificate, recently refashioned as a Summer Institute in Leadership Arts, was guided by similar motivations. Drawing from philosophy and literature - including Shakespeare, Machiavelli, Thucydides, and, this summer, Daniel Burnham's Plan of Chicago - the Leadership Arts program crafts a curriculum that reminds us that leadership and workplace issues deal with the oldest and most persistent questions we face: what motivates us, how does our work matter, and what is the glue that binds us together?

One complaint we hear: none of this is practical. But it is. -->

As an example, one valuable lesson we can take away from Daniel Burnham's Plan of Chicago is a refreshingly ambitious approach to planning. At the core of Burnham's Plan of Chicago was this truth: we don't know what the future will bring, and our plans should be audacious and scalable (to use a contemporary business term). Don't focus only on what is practical or necessary given one's assessments of present needs and circumstances. Plans should be more far-reaching, more aspirational.

The problem with the way Chicago developed, Burnham believed, was that it emerged as a collage of uncountable pragmatic decisions or accommodations; there was no plan. How many workplaces are just like this? This approach to development (of a city or an organization) inevitably leads to dysfunctionalities. But the response shouldn't be to assemble a plan that addresses these dysfunctionalities, this chaos, and these shortcomings. Instead, plans need to look beyond the present and plan for the future. Too many organizations - guided by leaders and employees who can't think more expansively - create processes to fix problems, rather than plans to move beyond these problems and into a future that can only be imperfectly viewed from our present vantage point.

Wednesday, February 17, 2010

To Survive, Specialize

One of the unmistakable realities of evolutionary biology is that most species who adapt and survive do so because they find a way to specialize in the vast web of life. Nature is a hostile and competitive place, and as a general principle, the more specialized an organism is, in terms of its diet or habitat, the more likely it is to survive. Unless of course, environmental shifts wipe out the species' food source or habitat. One reason generalists survive is because they can avoid exactly that type of catastrophe. The actinedid follicle mite only infests (and finds sustenance in) human eyebrow hairs. If we all shaved our eyebrows the species would disappear. Sharks, though, have survived across many eras, outlasting the dinosaurs, because they eat almost anything.

But I've drifted too far from my point. When looking at the prospects of employment in Human Resources, it seems clear that generalists are dying off and specialists are thriving (although choosing your specialty might be vital for long-term survival). Consider these U.S. Bureau of Labor statistics (taken from HR Magazine):

The thing to notice is this: the things HR managers once did - compensation and benefits, payroll, and training and development, narrowly defined - will only generate a few thousand new jobs between now and 2018. Hundreds of thousands of jobs will be available in more specialized areas - recruitment and placement, talent analysis, and training and development geared toward cultivating the next generation of leaders who will fill the seats being emptied by retiring baby-boomers.

The other key trend - not mapped out in this data - is a move toward using more carefully defined metrics, to identify the talent needed to meet the organization's objectives, to inventory the organization's existing talent, to put a time estimate on how long specific types of talent will be needed and what the most cost-effective approach is to getting that talent. This is all stuff that departments and divisions across a firm do sloppily, using past experience, rules of thumb, and guesswork. Often department managers fold acquiring staff into an overall effort to try to maximize the resources under their control - more influence, more space, more funding for projects, more people. But in today's economy - in fact in any sane and rational system - a department's value is measured by its work product: is it effective in helping the organization achieve the things it needs to achieve? If this is the measure, then departments need the right people in place, not an army of people. And this points to a new, or perhaps newly significant requirement for HR personnel: they need to function as internal consultants. Directors, managers, and department heads don't know how to assess, recruit, support, and develop talent. Or at least they have imperfect ideas about all of this, and need specialists to help them.

So, perhaps in this case, specialization won't just help those of you working in HR to survive, but maybe it will help your firms survive too.

If you work in Human Resources, you need to enroll in our Strategic Talent Management and Organizational Design Certificate, which helps map the move from service-orientation to strategic partnership. And from generalist to specialist.

Tuesday, January 12, 2010

What's The Point?

Innovation sometimes happens by accident. Sometimes through a moment of inspiration. More often, it's a product of conversation. In the case of Groupon, the Chicago-based website that offers discounts at restaurants, museums, health clubs, clothing stores, dentists, sky-diving clubs, pedicure salons, it was a conversation about The Point. The Point was a website launched by Andrew Mason, whose brief affiliation with the University of Chicago was a quarter-long period of study with the Harris School of Public Policy. The Point was an attempt to employ the principle of the tipping point to inspire volunteer campaigns, charitable giving, and other worthy activities. The idea was simple: users could post a challenge - for example raising money so the Comunicada Foundation can give hens and chicken coops to families in Masaya, Nicaragua - and set a tipping point. In the case of the Comunicada Foundation, the tipping point was $1000. If visitors to The Point reached the $1000 tipping point, the money would go to buy hens and chicken coops for Masaya. If the tipping point wasn't reached, then any contributors who pledged to give would be off the hook, and their credit card wouldn't be charged. The point behind The Point was that people often feel charitable, or they want to work for change, but they feel like their contribution or their voice won't make a difference. The Point provided a bucket, where people could drop in their small contribution and see progress toward the larger goal, making people feel they were part of a micro-movement.

Andrew and his financial backer, Eric Lefkofsky, puzzled over how to make money from the concept. The result was Groupon, which was based on a simple concept: businesses need business, and consumers want discounts. The goal is to bring them together. And Mason saw that this was fundamentally a tipping point problem. Businesses are reluctant to discount, because it represents a loss of revenue. And too often, the people grabbing up the discounts are people who would have visited the business anyway. But, what if you could guarantee the business this: lots of new customers and an opportunity to only deliver the discount if it made financial sense to the business. For example, if 300 people walk through the door and get your product for half-price, and 200 of those people are new customers, you've lost revenue you might have collected from the 100 returning customers who are taking advantage of the discount offer, but you've collected revenue from 200 people who might never have walked through your door. So Groupon reaches out to businesses and says: a) set a discount price and b) tell us how many customers it will take at that price for this deal to make sense for you. Once those numbers are set, Groupon puts the deal on the website. If the tipping point isn't reached, the business isn't obligated to provide the discount. And the prospective customers who took the business up on the offer walk away, without their credit card being charged. But - and this is clearly part of the business model - hundreds, perhaps thousands of prospective new customers learn about a business when it is featured on Groupon.

What's the point? Mason's original idea - that he could create social change by creating a forum where people could propose projects and then assemble the numbers to fund those projects - had real appeal. But to a great extent, The Point wasn't much more than a social media site with a heart. It wasn't a business. The site doesn't carry ads. For any successful campaign where money is collected, the site keeps 5% of the total for "transaction and administrative costs." But many of the campaigns are action based, for example, a campaign to force KFC to adopt cruelty-free standards for the chicken they serve in their restaurants. For these, The Point gets nothing. Mason and Lefkofsky saw they had an intriguing model, but no way to profit from it. Groupon was the result of this effort. The company won't reveal their revenue, but they recently secured $30 million in investment capital to expand their operation to fifty new cities in 2010.

In an uncertain economy,
the smartest investment

The Graham School's Business and Professional certificate programs provide quality career-related education in convenient short, intensive, related seminars, allowing students to continue developing their careers, broadening their perspectives, and strengthening their skill sets. Our programs help you prepare for change and equip you for success.