Sunday, July 31, 2005

Unleash Your Potential

Unleash Your Potential

Inside every seed is a tree. What you see is not all there is. That is potential. God created everything with potential, including you. Potential is dormant ability, reserved power, untapped strength, unused success, hidden talents, capped capability. Potential is all you can be but have not yet become; all you can do but have not yet done.

The keys to releasing your potential:
You must know (be related to) your source. To understand the potency of your potential it is essential that you know God.

You must understand how God designed you to function. God designed you to function like He does by faith and love. Your potential cannot be released without a combination of faith and love.
You must know your purpose. Whatever purpose God created you for, He also gave you the potential to fulfill it. Your potential is equal to the assignment.
You must understand your resources. God provides abundant material and physical resources to sustain and maintain your life. Resources were created to live on and with, but never for. We are never to worship the resources, nor be controlled by them.
You must have the right environment. God designed man to function in the garden, in relationship with Him, free from sin, and in daily communion with His spirit. The Fall of Man contaminated this environment. The key to realizing your potential is the restoration of God's original environment. Jesus came to restore us to the Father, and sent the Holy Spirit to restore our internal environment.
You must work out your potential. Work is a major key to releasing your potential. Potential must be exercised and demands made on it, otherwise it will remain "potential." Good ideas do not bring success. Good hard work does. To release your true potential, you must be willing to work.
You must cultivate your potential. Potential is like a seed. It is buried ability, and hidden power that needs to be cultivated. You must feed your potential the fertilizer of positive company, give it the environment of encouragement, pour out the water of the Word of God, and bathe it in the sunshine of personal prayer.
You must guard your potential. It is sad when what could have been becomes what should have been. God called your potential your treasure, something to be valued and guarded from sin, discouragement, procrastination, distractions, and compromises.
You must share your potential. True potential in life is not what is accomplished, but who benefits from it. Your deposit was given to enrich and inspire the lives of others.

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Sunday, July 24, 2005

Managing Knowledge

Managing Knowledge Means Managing Oneselfby Peter F. Drucker

Peter F. Drucker

Peter F. Drucker has been a teacher, writer, and adviser to senior executives for more than 50 years. Author of 31 books, including his recently released Management Challenges for the 21st Century, he is honorary chairman of the Drucker Foundation and Clarke Professor of Social Sciences at the Claremont Graduate University in Claremont, California.

More on Peter F. Drucker

In a few hundred years, when the history of our time will be written from a long-term perspective, it is likely that the most important event historians will see is not technology, not the Internet, not e-commerce. It is an unprecedented change in the human condition. For the first time -- literally -- substantial and rapidly growing numbers of people have choices. For the first time, they will have to manage themselves. And society is totally unprepared for it.

Throughout history, practically nobody had choices. Until about 1900, even in the most highly developed countries, the overwhelming majority followed their father's line of work -- if they were lucky. If your father was a peasant farmer, you were a peasant farmer. If he was a craftsman, you were a craftsman. There was only downward mobility; there was no upward mobility.Now suddenly a large number of people have choices. What is more, they will have more than one career, because the working life span of people is now close to 60 years -- three times what it was in 1900. People in my executive management program (who are 45 years old on average and very successful) tell me, to a person, "I do not expect to end my career where I am working now."

Abundance of Choices

Knowledge gives choice. It also explains why we suddenly have women in the same jobs as men. Historically, men and women have always had equal participation in the labor force -- the idea of the idle housewife is a 19th-century delusion. Men and women simply did different jobs. There's no civilization in which the two genders did the same work. However, knowledge work knows no gender; men and women do the same jobs. This, too, is a major change in the human condition.
To succeed in this new world, we will have to learn, first, who we are. Few people, even highly successful people, can answer the questions, Do you know what you're good at? Do you know what you need to learn so that you get the full benefit of your strengths? Few have even asked themselves these questions.On the contrary, most are proud of their ignorance. There are human resource people who are proud of the fact that they can't read a balance sheet. Yet if you want to be effective today, you have to be able to read one. On the other hand, there are accountants who are equally proud of the fact that they cannot get along with people! That, of course, is nothing to be proud of, because anyone can learn to work smoothly with others. It is not hard, after all, to learn manners -- and manners are what allow people to get along.

Knowing Yourself

Throughout human history, it was the super achievers -- and only the super achievers -- who knew when to say "No." They always knew what to reach for. They knew where to place themselves. Now all of us will have to learn that. It's not very difficult. The key to it -- what Leonardo da Vinci and Mozart did -- is to record the results of our decisions.
Every time you do something that is important, write down what you expect will happen. The most important decisions in organizations are people decisions, and yet only the military, and only recently, has begun to ask, "If we assign this general to lead this base, what do we expect him to accomplish?" Three years later they look back at what they had written. They have now reached a point where 40 percent of their decisions work out.The Roman Catholic Church is just beginning to ask the same question about bishops. "Why do we put the bishop into the diocese? What do we expect?" And the Church finds that a great majority of appointments do not fulfill expectations, because they get no feedback on their performance.

Building on Strengths

It's easy to understand our strengths by tracking our results. Yet most of us underestimate our own strengths. We take them for granted. What we are good at comes easy, and we believe that unless it comes hard, it can't be very good. As a result, we don't know our strengths, and we don't know how we can build on them.We also seldom know what gifts we are not endowed with. We will have to learn where we belong, what we have to learn to get the full benefit from our strengths, where our weaknesses lie, what our values are. We also have to know ourselves temperamentally: "Do I work well with people, or am I a loner? What am I committed to? And what is my contribution?" Unfortunately, nobody teaches us these things. In the next 30 years most educated people will have to learn to place themselves, in work and in life.

Improving Productivity

Understanding our strengths, articulating our values, knowing where we belong -- these are also essential to addressing one of the great challenges of organizations: improving the abysmally low productivity of knowledge workers. The productivity of teachers, for instance, has not improved, and may in fact have shrunk, in the past 70 years. (Of course teachers in the 1920s enjoyed the advantage of not having faculty meetings to attend.) And nurses and sales workers are only two-thirds as productive as their counterparts 70 years ago.
Yet we know that hospitals can improve productivity by asking their nurses two simple questions: What are you being paid for, and how much time do you spend doing that? Typically, nurses say they are paid to provide patient care, or to keep the doctors happy. Both are good answers; the problem is that they have no time to do either job. One hospital more than doubled its nurses' productivity simply by asking them these two questions, and then hiring clerks to do the paperwork that prevented nurses from doing their real job.
Effective organizations put people in jobs in which they can do the most good. They place people -- and allow people to place themselves -- according to their strengths.The historic shift to self-management offers organizations four ways to best develop and motivate knowledge workers:

Know people's strengths.
Place them where they can make the greatest contributions.
Treat them as associates.
Expose them to challenges.

The greatest competitive advantage of the United States is that it attracts top knowledge workers from around the world -- not just because they earn more money but because they are treated as colleagues, not as subordinates. Knowledge workers don't believe they are paid to work 9 to 5; they believe they're paid to be effective. Organizations that understand this -- and strip away everything that gets in their knowledge workers' way -- will be able to attract, hold, and motivate the best performers. That will be the single biggest factor for competitive advantage in the next 25 years.

Role of the Social Sector

I take a dim view of most of the programs companies create to develop their people. The real development I've seen of people in organizations, especially in big ones, comes from their being volunteers in a nonprofit organization -- where you have responsibility, you see results, and you quickly learn what your values are. There is no better way to understand your strengths and discover where you belong than to volunteer in a nonprofit. That is probably the great opportunity for the social sector -- and especially in its relationship to business.We talk today of the social responsibilities of business. I hope we will soon begin to talk about the nonprofit organization as the great social opportunity for business. It is the opportunity for business to develop managers far more effectively than any company or university can. It is one of the unique benefits that the social sector can offer -- to provide a place where the knowledge worker can actually discover who he or she is and can actually learn to manage him- or herself.

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Monday, July 18, 2005

Moral Intelligence

Moral Intelligence: Enhancing Business Performance and Leadership Success

First there was emotional intelligence, then came spiritual intelligence, and now we have moral intelligence. Lennick and Kiel, both management consultants, define moral intelligence as “the ability to differentiate right from wrong as defined by universal principles.” Crediting the groundbreaking work of Daniel Goleman and his colleagues for incorporating the concepts of emotional intelligence into the twenty-first century workplace, they carefully explain the distinction between moral and emotional intelligence. While the two are closely related and emotional intelligence is involved in situations requiring moral decision making, the key difference is that moral intelligence is, by definition, values-based.

When they embarked on this project, Lennick and Kiel found only limited research focusing on moral leadership despite a review of academic literature in the fields of philosophy, social biology, developmental psychology, cultural anthropology, and the neurosciences. They went on to conduct in-depth interviews with more than thirty CEOs and roughly fifty other senior executives to understand how leaders used their moral intelligence to achieve personal and business goals. Part One defines moral intelligence and makes the case that behaving morally is not only the right way to live but is also good for business. The authors explore how moral skills are developed in human beings and offer perspectives from psychology and neuroscience to give a basic foundation for understanding how moral leaders are created.

Part Two focuses on the key elements that encompass moral intelligence: integrity, responsibility, compassion, and forgiveness. Integrity means acting consistently with principles, values, and beliefs. In explaining this principle, the authors give some obvious and somewhat simplistic examples of situations in which being dishonest may seem the easy way out of a difficult situation (as in exaggerating earnings when faced with an overbearing and demanding CEO, for example). In the end, telling the truth is usually the best alternative. The authors acknowledge that all situations are not that straightforward and that in some cases, business leaders cannot be completely forthcoming with their staff. Leaders in situations involving downsizings, initial public offerings, and mergers and acquisitions may realize that it would be better for employees to know that there are planned layoffs yet may not feel at liberty to divulge the information.

Lennick and Kiel define responsibility as a willingness to accept accountability for the consequences of actions and choices and admit mistakes and failures. Compassion and forgiveness mean caring about others. Leaders who are compassionate actively support the choices and goals of their staff. The authors point out that being compassionate does not mean denying bad behavior.

While the first two sections of the book apply the ideas of moral competence to individuals, the final section discusses it from an organizational perspective. This section suggests ways that organizations can institutionalize the principles of moral intelligence, exploring what it means to be an organization with integrity, and create policies that are morally intelligent.



Ajit Chouhan

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Saturday, July 16, 2005

INNOVATION: The New Route to New Wealth

Innovation: The New Route to New Wealth

by Gary Hamel

Where does new wealth come from? Like a four-year-old's curiosity about how babies are born, it's a deceptively direct question that often disarms our capacity to answer. To be sure, we're ready with pat responses peppered with references to return on investment, return on net assets, and economic value added, but these measures tell us more about how revenues are rearranged than about how they're created anew. After all, we're not talking about market share sliced loose from a competitor or revenues boosted by an acquisitions binge -- but truly new wealth: revenues from new customers buying products or services that yesterday they didn't know they needed and today can't live without.

Creating new wealth requires more than simply responding to market demand. Think about some of the path-breaking products of the past few decades. No car buyers walked into Chrysler dealerships in 1983 saying that what they really wanted was a van mounted on a car chassis with folding seats -- and don't forget some cupholders. No customers told Sony the only thing wrong with its tape players was that you couldn't strap one on your head. Neither the BBC nor any of the Big Three U.S. TV networks saw a market for 24-hour news; it took a renegade named Turner operating out of Atlanta to wed three developments -- the shoulder-held minicam, more affordable access to satellite transmission, and the fact people no longer make it home in time for the six o'clock news -- into the concept of a continuous news format. Innovations like the minivan, the Walkman, and CNN succeeded not because they responded to market need but because they created a need consumers had yet to sense themselves.
All of which attests to the fact that in the New Economy, the greatest rewards go to companies that create new business models -- ideas that spark new sources of revenue based on changing technology, demographics, and consumer habits. By definition, new business models destroy old ones, which is why creating new wealth is a threat to every traditional, unimaginative business. Never before have strategy life cycles been shorter and market leadership counted for less. Call it the First Law of the Innovation Economy: Companies that are not constantly pursuing innovation will soon be overwhelmed by it. Strategy innovation is the only way to deal with discontinuous -- and disruptive -- change.

The Innovation Imperative
ome companies seem to understand the innovation imperative instinctively. Consider Charles Schwab's daring plunge into the online unknown: When the bricks-and-mortar broker took the view that online trading was inevitable, it faced a choice between leading the brokerage industry to the future or being a victim of some dot-com start-up that got there first. Thus, on the fateful day in 1995 when a technology team within Schwab presented a demo of what the Web could do, senior managers almost instantly recognized how the Internet could make life better for Schwab customers. Schwab invested in the Web even before it realized it would face aggressive price-based competition from other Web brokers. By committing to the goal -- and pursuing it through a series of low-risk experiments -- Schwab was able to establish a dominant position in the online trading world.
Today, Schwab controls some 30 percent of all the stock trading that takes place on the Web. Even more impressive, Schwab's market capitalization -- $3.5 billion in 1995, less than half that of Merrill Lynch -- has now pulled even with Merrill's, which instead of engaging the Internet, pursued until recently a policy of digital denial.

You're Never Too Old to Innovate

chwab is not an upstart. And innovation isn't the special preserve of Internet upstarts or the denizens of the dot-com motels of Silicon Valley. In fact, innovation can happen at any company, regardless of its line of business, age, or location.
Can a century-old company learn to innovate like an industry ingenue? The answer is yes -- provided the company is willing to examine its orthodoxies, abandon its strategy-by-habit ways, and engage its employees broadly and deeply in the effort to envision the new markets and new opportunities that promise new wealth.
Consider the experience of PECO Energy Corporation -- the old Philadelphia Electric Company. Founded in 1881, PECO had operated for its entire existence within the public utility paradigm, with a regulatory strategy that brought it significant success. In June 1997, however, the company was looking to transform its regulatory strategy to fit the dawning deregulated environment.

Working to examine its hidden assumptions, PECO uncovered a core competency in operating large, mission-critical infrastructure -- a competency honed in time of crisis a decade earlier when PECO grappled with bringing its own Peach Bottom nuclear plant into federal compliance. PECO emerged from the Peach Bottom process with a proven ability to bring "problem plants" to high-capacity performance with low operating costs.

As a result, where other companies saw liabilities, PECO saw opportunity. PECO would follow its competency into places other companies feared to tread -- taking on responsibility for running environmentally risky nuclear plants in a safe, efficient manner. PECO has now bought three U.S. nuclear plants that had been for sale for years -- including a reactor at Pennsylvania's notorious Three Mile Island, obtained for $23 million -- a substantial discount from its $640 million book value.

The problem-plant strategy proved just one element of a broader innovation agenda. PECO teams looked beyond their traditional market to tomorrow's opportunities. A prime example: PECO conceived of the wire that delivers electricity into each home as a pipeline permitting a far wider carrying capacity. The company built on its core competency in power delivery networks to launch a new communications platform. Exelon, a subsidiary of PECO Energy, has strung 27,000 miles of high-speed telecommunications line atop electrical transmission poles -- and signed up over 100,000 phone customers in its first year in operation. PECO now looks to combine the installation of electric, gas, telephone, and cable to provide a single-source installation service for its customers.
hat's standing in the way of companies that fail to innovate? In many cases, it is the tried-and-true recipe that brought them past success.

Over time, every business model and every strategy goes stale.

It's understandable. Businesses with a winning formula are logically reluctant to change horses in midstream. Over time, however, every business model and every strategy goes stale -- and in our fast-forward economy, strategies reach their "sell-by" date faster than ever. Indeed, the life cycle of successful business strategies has been rapidly declining in a period of high competition and innovation. In the Industrial Age, a successful business strategy for steel manufacture or durable goods might power a company for a generation or more; today, Moore's Law (which states that computing power and speed double every 18 months) is setting the terms for strategy life cycles that are measured in months, not years.
How can a company tell if its present profits come from spending down past success? Here are three new realities to consider:

The inevitability of commoditization. Every new product or service will become a commodity in time. Not many years ago, cell phones cost upwards of $100; today, companies will give you one to sell you their service. Likewise, phone service itself is now a commodity: Traditional telecoms -- local as well as long-distance -- are engaged in a race to the bottom to see who can sell access to a dial tone for how little. Meanwhile, Internet upstarts are considering giving away long-distance calls to lure people to their site, while deriving their revenue from advertising and other sources.

Most forecasts are worthless exercises.

The impossibility of forecasting future trends. Most forecasts are worthless exercises in spreadsheet manipulation -- and not just because small adjustments in key variables create wildly different projections over time. The larger problem is that traditional forecasting projects past assumptions forward, providing a sense of false comfort to established companies wedded to existing business models. It's like auto industry forecasters painting a reassuring picture of steadily rising minivan and family sedan sales -- the year before Ford rolled out something it called the Sports Utility Vehicle. Whatever industry you're in, you can't drive change looking in the rear view mirror.
The futility of waiting for inspiration. If it's a given that great companies are built on a brilliant idea, the next question is where the next great idea will come from. Don't be fooled by the rosy glow of growth: Companies living off a single great insight are the corporate equivalent of dead stars-in spite of their sparkle, they're cold at the core. Like grandma's favorite "Five and Dime" store in the age of category-killers and cyber-shopping info-bots: Stand pat with your original business model, and burnout is only a matter of time.

Creating an Innovation Engine
f companies can't depend on the lightning bolt of sudden inspiration or serendipitous discovery, then what? An innovative environment can be consciously created -- if a company is willing to abandon old rules, shed old habits, and upend cherished conventions. The key is recognizing that past achievement militates against future adaptability by creating well-worn ways of doing things that cause a company to undervalue or ignore rule-breaking insights. Yesterday's laserlike focus becomes today's set of blinders, narrowing an enterprise's field of vision from what is truly new to what it already knows. Glimmers of great ideas are evident in most organizations; the problem is that in direct proportion to the degree those great ideas are different, the "immune system" of most organizations attacks those ideas as foreign organisms, threatening the host.

Part of the challenge is demystifying innovation by breaking it down to its constituent parts. Here are three ways to begin the process of awakening innovation in your company:
Recognize that innovation doesn't follow a schedule. Most companies are so bounded by existing orthodoxies and obsolete business models that they think they can schedule strategic insight the way you record a reminder in your day-planner. But the truly innovative bursts of insight that trigger new ideas don't obey the corporate planning calendar.
Consider that the idea for Nokia's wildly successful rainbow-hued cell phones emerged not from a daylong strategy session in the corner office but from an afternoon at California's Venice Beach, as company execs watched sun-drenched skaters slash down the boardwalk, sporting color-coordinated shades, Rollerblades, and bathing suits. The realization: Mobile phones are as much fashion accessory as communications tool, an inspiration that's pushed Nokia to the cutting edge of cells.

Shatter the "strategy monopoly." In any company, a hierarchy of organization dominates a hierarchy of ideas. The antidote: To encourage innovation, unlock ideas from across the company. Bring together a cross-section of employees at all levels to share the new perspectives that may just contain the kernel of a bold new idea. Realize that every company promotes success as defined by today's reigning strategy; the question is how to promote new ideas that may have nothing to do with that strategy -- or may even cut against it.
That's how Virgin Enterprises operates under the lead of Richard Branson. Every employee has Branson's phone number, and can pitch new project ideas directly to the top. That's how a Virgin Airlines flight attendant turned her difficulties in planning her own wedding into a new venture: the wedding planning boutique Virgin Bride.
Institutionalize innovation by building a safe place for people to think new thoughts. In some companies, new ideas are in short supply -- stifled by a corporate climate that cuts off intellectual oxygen, discourages change, and demands conformity. At other companies, ideas abound -- and the challenge takes a different shape: Creating the conceptual conveyor belt that moves from ideas to action.

Can a company really institutionalize innovation? Witness the effort of Royal Dutch/Shell, the Anglo-Dutch oil giant. With $138 billion in revenues, 102,000 employees, and nearly a century-old tradition, Shell is the epitome of a lumbering industrial behemoth -- the last place you'd expect to find entrepreneurial zeal. Within Shell's Balkanized organization -- which one employee compared to a maze of 100-foot-high brick walls -- access to capital is tightly controlled, investment hurdles are daunting, and radical ideas move slowly, if at all. Shell's globe-trotting managers are famously disciplined, diligent, and methodical. In cataloguing their character and capabilities, "wild-eyed dreamers" is not a term that comes to mind.
Enter Shell's GameChanger initiative, begun in 1996. As an incentive to innovate, a group of Shell employees were given the authority to allocate $20 million to rule-breaking, game-changing ideas submitted by their peers. Proposals would be accepted from anywhere within the company -- no need to squeeze radical new ideas through the keyhole of existing programs and priorities.

Shell's GameChanger team embarked on an Action Lab: An intensive five-day experience designed to dramatically accelerate the translation of "gamechanging" ideas into practical venture plans for the launch of new businesses -- plans of the kind that would pass muster with venture capitalists in Silicon Valley. The goal was for each team to present its story to a "venture board" -- a panel of senior Shell executives and representatives from Shell Technology Ventures Inc., a unit whose job is to fund late-stage technology commercialization. The venture board was empowered by GameChanger to "sponsor" winning concepts and fund the next round of business development. In the end, four teams out of the original twelve received six-month funding to put them on a path toward full-fledged business plans.
For Shell, GameChanger was the beginning of an attempt to institutionalize innovation. Today, any employee with a promising idea is invited to give a 10-minute pitch to the panel, followed by a 15-minute Q&A session. Ideas that get a green light often receive funding -- on average, $100,000, but sometimes as much as $600,000 -- within eight or ten days. Ideas that don't pass muster enter a database accessible to anyone within Shell, a kind of innovation stockpot that helps entrepreneurial employees shape their own ideas or bring new insight to existing ones. To date, several of GameChanger's ventures have found homes in a Shell operating unit or in one of the company's various growth initiatives. Still others have been carried forward as R&D projects, while the remainder have been wound down and written off as interesting but unproductive experiments.

GameChanger is producing measurable results: Of Shell's five largest growth initiatives for 1999, four had their genesis in the GameChanger -- including one exploring an entirely new business focused on renewable geothermal energy sources. Fully 30 percent of Shell's exploration and production R&D budget is now devoted to ventures that are GameChanger graduates.

As the Shell case suggests, it is possible to create an internal constituency for change -- inspiring a new breed of "innovation activist" to find an ear and an outlet for creative new concepts within a company. Compared to innovation-unfriendly organizations that leave their iconoclasts no option but to take their bright ideas elsewhere, Shell's experience proves that established companies can create a hospitable climate for change.
hat can innovation-minded executives do to create such a culture in their company? Here are three ways to kick-start the innovation process:
Start new conversations. New ideas don't obey an organizational chart. Companies that want to get serious about innovation need to break the "strategy monopoly" that closes off the executive suite from new ideas percolating in other corners of the company. Innovation-minded companies spark new conversations by bringing together executives with employees of all ranks to question corporate orthodoxies and search for new ways to do business.
Seek new perspectives. If you want your company to do a better job of envisioning the future, ask the people who will get to the future first: Your youngest employees. If you want to know how consumers act, don't observe them in focus-group captivity -- join the Nokia execs for a day at the beach. Want a new vision? Try a new vantage point -- and watch a world of opportunity open up.

Innovation comes from the heart as well as the head.
Spark new passions. Innovation comes from the heart as well as the head. Companies that aren't afraid to innovate engage employee energies in a new and profoundly different way. When people are part of a cause and not just a cog in the wheel, their IQ -- innovation quotient -- skyrockets.

And above all, recognize that in today's economy, capital is plentiful; good ideas are scarce. Companies that look to incremental change to generate additional revenue will tend toward subsistence at best -- eclipsed by companies that create an environment of innovation, spawning the new ideas that generate new wealth. That's why an ambitious enterprise must replicate within itself the basic DNA of innovation: A culture of continuous experimentation embedded broadly and deeply throughout a company.

All of which brings us to the final characteristic of the true innovator: courage -- the guts to realize it's time to take a hammer to your own business model, before someone else does it for you.


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Thursday, July 14, 2005


Looking to Make a Sale or Get Promoted? Emotions Will Help Determine the Outcome .

High emotion contributes to great opera. It does not, however, serve us well when making judgments about others. This is the argument advanced in "Feeling and Believing: The Influence of Emotion on Trust," a new paper by Maurice E. Schweitzer, Wharton professor of operations and information management, and Jennifer Dunn, a PhD student in the department.

The two researchers conducted five experiments to determine the influence of emotional states -- happiness, gratitude, anger, and guilt -- on trust. Each experiment confirmed that incidental emotions (emotions from one situation that influence judgment in a following, unrelated situation) affect how willing we are to trust others. For example, our anger over a speeding ticket is likely to affect how we judge someone later in the day. The researchers conclude that despite feeling we are rational beings who make clear, lucid judgments, in reality we all walk around in a sea of emotions that are likely to influence how we act in both business and social contexts.

The article, recently published in the Journal of Personality and Social Psychology, stems from Schweitzer's ongoing interest in negotiation, where trust plays a critical role. Previous research identified trust as a combination of two constructs: one's own propensity to trust and one's knowledge about the other person. "This research suggests that we make a cognitive decision and use reason to decide whether or not to trust someone," notes Schweitzer. "What our research says is that trust is much more labile than that."
In other words, trust is a constructed judgment that is influenced by irrelevant information. "The extent to which I do or do not trust you is a function not only of how trusting a person I am and what I know about you, but also a function of irrelevant events that have influenced my emotional state. For example, if I hit a parked car, argued with my spouse, learned that I have to pay a large repair bill (or won an award, had a paper accepted, or saw my stock account grow) beforehand, I would trust you less (or more). The main idea in the paper is that emotions which are irrelevant to the judgment task nevertheless influence trust judgments in predictable ways," Schweitzer says.

He and Dunn demonstrated this through a series of experiments, each one designed to test a different aspect of the "emotions affect trust" theory. In one study, for example, he and his team approached people waiting for trains and asked if they would be willing to take part in a study. They were asked to name a co-worker and then -- after an "emotion induction" phase -- answer a series of questions about that person. In the "emotion induction" phase, participants recounted in writing an incident that made them angry, sad, or happy (depending on which emotion they were assigned). Participants wrote about events like the birth of a child (happiness), the untimely death of a loved one (sadness), or the destructive behavior of a neighbor (anger). After this exercise, participants rated their co-workers on such statements as: "If X promised to copy a presentation for me, s/he would follow through," and "X would never intentionally misrepresent my point of view to others." Results showed that happy participants were significantly more trusting than were sad participants, and sad participants were significantly more trusting than were angry participants. Throughout each of the five studies, the results were the same. "What surprised me most was the magnitude and consistency of the effects," says Schweitzer.

A "Simple Manipulation"
For managers, this study reveals much about human nature, he suggests. "We can easily channel people and direct them to a happy, sad or angry place ... in a relatively short period of time with a relatively simple manipulation." These manipulations can take the form of a short story (e.g., a news story), a short movie clip, or even a short discussion. For example, the best salespeople "don't call on a customer and start with a comment about the stock market dropping or a favorite sports team losing. Instead, they focus attention on something uplifting," like a team making the playoffs or an upcoming holiday.

"In negotiation, we have always known that non-task communication -- discussion that's not directly relevant to the negotiation process -- is important for closing a deal," says Schweitzer. "This research gives us some insight into why it's important and what kinds of things should go into that communication." Specifically, "non-task communication, like telling jokes/stories or talking about sports, can change people's emotional states and make them more (or less) trusting. My advice is to give serious thought to non-task communication. This includes preparing the types of stories you tell and the types of non-task questions you ask. It also includes learning more about a client, such as whether he/she is a huge Red Sox fan or cares a lot about wildlife refuges. Conversely, you should recognize that when a salesperson or someone else engages in a conversation like this, he or she may influence your emotional state and subsequently your 'trust judgment'. The reason you gave someone a large contract may have more to do with how funny the story he told you beforehand was than with his reputation for dependability."

So going in to ask for a promotion or new responsibilities on the job is probably a good time to recount a funny story or ask about your supervisor's golf game, Schweitzer says. The point is to recognize the role that emotions play. Outside events -- such as the rise/fall of IBM stock if your supervisor owns it, or whether his or her child got accepted into a prestigious college -- as well as non-task communication, like telling a funny story, are important for trust judgments.
That's not to say we should never acknowledge problems that occur outside of the work setting, Schweitzer adds. "You have to demonstrate sensitivity." If a colleague is going through a difficult time personally, you should acknowledge it, but not dwell on it. "Our research shows that you can shift people to think about happy things and make them -- literally -- happy."

What Schweitzer and Dunn don't know is how long these incidental emotions last. The research tested people's propensity to trust immediately after the emotion induction (putting people into a happy, sad, or angry mood). Schweitzer is now working on a series of tests to determine the durability of these emotions: Do they last for minutes, hours, days or weeks? The results should help fill out the picture of how emotions affect our judgments.

Being Aware of Your Emotions
A second key finding in the study is that if people are aware of their emotional state, then the emotional state does not generally bleed into their judgments of others. In one study, for example, participants were shown film clips to induce either happiness or anger. Participants in the "happy" group watched a Robin Williams comedy routine, while those in the "anger" group watched a clip from the film Witness, in which teenagers harass an Amish man. After watching the clips, half of those in the "happy" group saw a brief note on screen that read, "Prior research has shown that even short film clips like the ones you have seen can influence people's emotions." The other half saw a blank screen. This was duplicated in the "angry" group. Consistent with the other study, angry participants provided significantly lower trust ratings than happy participants among those who did not receive the warning message. Among those who viewed the warning message, trust levels were about the same.

Again, says Schweitzer, links to the business world are clear, in particular because the results speak directly to the issue of "emotional intelligence," a widely discussed concept in recent years. "Managers and employees alike need to realize that when making decisions, they are in a state that is driven partly by reason, but also partly by emotion," he notes. Taking into account the role of awareness, managers can keep an eye out for employees who are at risk for bringing unrelated emotions to critical decisions. For example, a manager in a law firm may need to pull another lawyer aside and say, "I know case X isn't going well, but case Y is different," or "I know you're going through a difficult divorce, but don't let that cloud your judgment when you go into your negotiations today." Says Schweitzer: "When people recognize the trigger, or source, of their emotions they are less likely to misattribute them. When I realize that I'm angry because of something my spouse did, I am less likely to use that anger in an unrelated judgment. When I am not aware of or thinking about why I am angry, I am more likely to misattribute it."

Unattributed emotions are a problem, he points out, particularly for people working in high-stress, fast-paced jobs, like judges and parole officers, who have to make quick judgments about people. Because they move from one incident to the next without the luxury of time to sit back and gauge their emotions, they are more likely to misattribute emotional states. Again, awareness and correct attribution of emotional states can help manage this process, he suggests.

Based on his work in the field, Schweitzer thinks people conceive of themselves as rational human beings driven by rational thought -- particularly Westerners -- but it's not true. "People undervalue the extent to which emotions influence their judgment," he says. Correctly attributing our emotional states can counter the effects of others who are trying to manipulate our feelings. "Good sales people tell jokes and funny stories; they bring little gifts. What they are trying to do is influence people's emotional states." Recognizing that this person is trying to make you feel good can help separate the good feelings from the decisions at hand. Are you feeling you can trust these new partners and sign on the dotted line because it's a solid deal or because you are ecstatic over your new baby? "This is what we need to be aware of," says Schweitzer.

The highly emotional people in the crowd shouldn't feel too bad, he adds, noting that our quick emotional reactions have served us well for the past 100,000 years. Our ancestors who happened upon a snarling, big-toothed animal were smart to listen to their emotions and run the other way. "Actually, it's only been fairly recently that we can or should override those emotional reactions," he says. In other words, going into battle mode may not be the best response to a large, scary-looking person coming toward you at work. Especially if it's your boss.

Tuesday, July 12, 2005

Great Managers Understand Their People

Great Managers Understand Their People

Average managers treat all their employees the same. Great managers discover each individual's unique talents and bring these to the surface so everyone wins. An excerpt from Harvard Business Review.

by Marcus Buckingham

"The best boss I ever had." That's a phrase most of us have said or heard at some point, but what does it mean? What sets the great boss apart from the average boss? The literature is rife with provocative writing about the qualities of managers and leaders and whether the two differ, but little has been said about what happens in the thousands of daily interactions and decisions that allows managers to get the best out of their people and win their devotion. What do great managers actually do?

In my research, beginning with a survey of 80,000 managers conducted by the Gallup Organization and continuing during the past two years with in-depth studies of a few top performers, I've found that while there are as many styles of managers, there is one quality that sets truly great managers apart from the rest: They discover what is unique about each person and then capitalize on it. Average managers play checkers, while great managers play chess. The difference? In checkers, all the pieces are uniform and move in the same way; they are interchangeable. You need to plan and coordinate their movements, certainly, but they all move at the same pace, on parallel paths. In chess, each type of piece moves in a different way, and you can't play if you don't know how each piece moves. More important, you won't win if you don't think carefully about how you move the pieces. Great managers know and value the unique abilities and even the eccentricities of their employees, and they learn how best to integrate them into a coordinated plan of attack.

This is the exact opposite of what great leaders do. Great leaders discover what is universal and capitalize on it. Their job is to rally people toward a better future. Leaders can succeed in this only when they can cut through differences of race, sex, age, nationality, and personality and, using stories and celebrating heroes, tap into those very few needs we all share. The job of a manager, meanwhile, is to turn one person's particular talent into performance. Managers will succeed only when they can identify and deploy the differences among people, challenging each employee to excel in his or her own way. This doesn't mean a leader can't be a manager or vice versa. But to excel at one or both, you must be aware of the very different skills each role requires. [...]

Managers will succeed only when they can identify and deploy the differences among people. Make the most of strengths. It takes time and effort to gain a full appreciation of an employee's strengths and weaknesses. The great manager spends a good deal of time outside the office walking around, watching each person's reactions to events, listening, and taking mental notes about what each individual is drawn to and what each person struggles with. There's no substitute for this kind of observation, but you can obtain a lot of information about a person by asking a few simple, open-ended questions and listening carefully to the answers. Two queries in particular have proven most revealing when it comes to identifying strengths and weaknesses, and I recommend asking them of all new hires—and revisiting the questions periodically.

To identify a person's strengths, first ask, "What was the best day at work you've had in the past three months?" Find out what the person was doing and why he enjoyed it so much. Remember: A strength is not merely something you are good at. In fact, it might be something you aren't good at yet. It might be just a predilection, something you find so intrinsically satisfying that you look forward to doing it again and again and getting better at it over time. This question will prompt your employee to start thinking about his interests and abilities from this perspective.

To identify a person's weakness, just invert the question: "What was the worst day you've had at work in the past three months?" And then probe for details about what he was doing and why it grated on him so much. As with a strength, a weakness is not merely something you are bad at (in fact, you might be quite competent at it). It is something that drains you of energy, an activity that you never look forward to doing and that when you are doing it, all you can think about is stopping.

Although you're keeping an eye out for both the strengths and weaknesses of your employees, your focus should be on their strengths. Conventional wisdom holds that self-awareness is a good thing and that it's the job of the manager to identify weaknesses and create a plan for overcoming them. But research by Albert Bandura, the father of social learning theory, has shown that self-assurance (labeled "self-efficacy" by cognitive psychologists), not self-awareness, is the strongest predictor of a person's ability to set high goals, to persist in the face of obstacles, to bounce back when reversals occur, and, ultimately, to achieve the goals they set. By contrast, self-awareness has not been shown to be a predictor of any of these outcomes, and in some cases, it appears to retard them.

Great managers seem to understand this instinctively. They know that their job is not to arm each employee with a dispassionately accurate understanding of the limits of her strengths and the liabilities of her weaknesses but to reinforce her self-assurance. That's why great managers focus on strengths. When a person succeeds, the great manager doesn't praise her hard work. Even if there is some exaggeration in the statement, he tells her that she succeeded because she has become so good at deploying her specific strengths. This, the manager knows, will strengthen the employee's self-assurance and make her more optimistic and more resilient in the face of challenges to come.

You can obtain a lot of information about a person by asking a few simple, open-ended questions. The focus-on-strengths approach might create in the employee a modicum of overconfidence, but great managers mitigate this by emphasizing the size and the difficulty of the employee's goals. They know that their primary objective is to create in each employee a specific state of mind: one that includes a realistic assessment of the difficulty of the obstacle ahead but an unrealistically optimistic belief in her ability to overcome it.

And what if the employee fails? Assuming the failure is not attributable to factors beyond her control, always explain failure as a lack of effort, even if this is only partially accurate. This will obscure self-doubt and give her something to work on as she faces up to the next challenge.

Repeated failure, of course, may indicate weakness where a role requires strength. In such cases, there are four approaches for overcoming weaknesses. If the problem amounts to lack of skill or knowledge, that's easy to solve: Simply offer the relevant training, allow some time for the employee to incorporate the new skills, and look for signs of improvement. If her performance doesn't get better, you'll know that the reason she's struggling is because she is missing certain talents, a deficit no amount of skill or knowledge training is likely to fix. You'll have to find a way to manage around this weakness and neutralize it.

Which brings us to the second strategy for overcoming an employee weakness. Can you find her a partner, someone whose talents are strong in precisely the areas where hers are weak? Here's how this strategy can look in action. As vice president of merchandising for the women's clothing retailer Ann Taylor, Judi Langley found that tensions were rising between her and one of her merchandising managers, Claudia (not her real name), whose analytical mind and intense nature created an overpowering "need to know." If Claudia learned of something before Judi had a chance to review it with her, she would become deeply frustrated. Given the speed with which decisions were made, and given Judy's busy schedule, this happened frequently. Judi was concerned that Claudia's irritation was unsettling to the whole product team, not to mention earning the employee a reputation as a malcontent.

Always explain failure as a lack of effort, even if this is only partially accurate.
An average manager might have identified this behavior as a weakness and lectured Claudia on how to control her need for information. Judi, however, realized that this "weakness" was an aspect of Claudia's greatest strength: her analytical mind. Claudia would never be able to rein it in, at least not for long. So Judi looked for a strategy that would honor and support Claudia's need to know, while channeling it more productively. Judi decided to act as Claudia's information partner, and she committed to leaving Claudia a voice mail at the end of each day with a brief update. To make sure nothing fell through the cracks, they set up two live "touch base" conversations per week. This solution managed Claudia's expectations and assured her that she would get the information she needed, if not exactly when she wanted it, then at least at frequent and predictable intervals. Giving Claudia a partner neutralized the negative manifestations of her strength, allowing her to focus her analytical mind on her work. (Of course, in most cases, the partner would need to be someone other than a manager.)

Should the perfect partner prove hard to find, try this third strategy: Insert into the employee's world a technique that helps accomplish through discipline what the person can't accomplish through instinct. I met one very successful screenwriter and director who had struggled with telling other professionals, such as composers and directors of photography, that their work was not up to snuff. So he devised a mental trick: He now imagines what the "god of art" would want and uses this imaginary entity as a source of strength. In his mind, he no longer imposes his own opinion on his colleagues but rather tells himself (and them) that an authoritative third party has weighed in.

If training produces no improvement, if complementary partnering proves impractical, and if no nifty discipline technique can be found, you are going to have to try the fourth and final strategy, which is to rearrange the employee's working world to render his weakness irrelevant. This strategy will require of you, first, the creativity to envision a more effective arrangement and, second, the courage to make that arrangement work. But the payoff that may come in the form of increased employee productivity and engagement is well worth it.

Excerpted with permission from "What Great Managers Do," Harvard Business Review, Vol. 83, No. 3, March 2005.

Marcus Buckingham ( is a consultant and speaker on leadership and management practices.

Ajit Chouhan

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Saturday, July 09, 2005


How to Lead with Spiritual Purpose, Values and Creativity

Kahil Gibran once wrote in the Prophet, Work is love made visible. When you work with love,
You bind yourself to yourself and to others and to God. In a way, that is the bold possibility that is available to all of us.
In more detail, that bold possibility is:
· Spirituality is the context for revolutionary, transformational leadership
· Leaders develop within themselves a purity and unity of thought, word and deed
· Leaders actively express their spiritual character in every aspect of their lives
· Spiritual values transform all aspects of life in business and in society
· Naturally resulting in spiritual well-being and global prosperity
Such a vision naturally invokes skepticism, in this case of two kinds. Some people are positive about business, but skeptical about spirituality. They would say things like, “Business and spirituality just don’t mix.” Some people are positive about spirituality and skeptical about business. They say things like, “You can’t really be spiritual if you are involved in business.”
But this skepticism, from a spiritual perspective, is welcome and it only invites a deeper inquiry into the relationship between the two. For some people it seems impossible to bring these two worlds together. I am reminded of a wonderful passage from Alice in Wonderland. Alice says, “One can’t believe impossible things.” The queen says, “I dare say you haven’t had much practice. When I was your age, I always did it for half an hour a day. Why sometimes I believed as many as six impossible things before breakfast.”
Is it really impossible to be spiritual and be successful in business? Janiece Webb, senior vice
president with Motorola certainly doesn’t believe so, for she recently told me,
I do believe strongly in leading in a spiritual way. It keeps you from doing many short-term
tactical actions that are often wrong for the business and the people. It also gives you immense courage to stand tall against politics. Being a spiritual leader can sometimes be lonely, but you feel happy and grounded inside. You also embrace your own humanness and imperfection. And, it keeps you humble as a leader and yet still strong.
In the past decade three questions have emerged in an ever-widening dialogue about spirituality and business. The first is, “How can we bring spiritual values into business?” This holds business as the context with the attempt to fit spiritual values into it. The second question is, “How can we integrate spirituality and business?” This has spirituality and business as equal playing fields with an attempt to bring a balance or overlap between them. The third is, “How can we unfold business from a spiritual context?” This has spirituality as the context, or the framework, in which we will look at how a business can then grow and unfold.
I find the third question to be most expansive, in mind, heart and soul. It brings about the widest and deepest creative answers. It also includes the two other questions in its scope. These questions in this ever-widening dialogue is most timely today because we live in a world in which our life goals are seriously out of balance. We find ourselves pursuing wealth without harmony with creation, creating a condition of global hyper-competition and global greed. And, we are pursuing our desires, but without spiritual fulfillment, creating a condition of global consumerism and global stress.
We can feel overwhelmed by the complexity of figuring out how to bring our lives, our wealth, and our environment back into greater balance, especially if we operate from the same mindset that created these conditions in the first place. Yet, simultaneously, a new consciousness is dawning with the promise of a new balance, from a spiritual context. Actually, it’s not a new consciousness, but a revolutionary return to our spiritual nature, and allowing that nature to return us to balance, integrity, and true global prosperity.
One sign of this dawning is a spiritual awakening in people. According to recent gallop poll data, people are wanting more spiritual growth, are not having the time to have it, and yet still they are speaking up about spirituality where they work. And, people are putting their money where their hearts are, they’re investing more and more in socially responsible companies.
There’s also a spiritual awakening in business. Consulting firms such as McKinsey are rolling out spiritually-based training programs and finding that they have a significant, positive effect on productivity, employee retention, and even market share. Business books on spiritual in business are the fastest growing segment of the business book industry. And the stories in this program about CEO’s, show that the revolution has started even at the very top. Ricardo Levy, CEO of Catalytics, Inc., has recently written,
Executive corporate leadership is a vocation that has equal dignity and equal critical societal impact to that of a priest or teacher. Spirituality has a very important role in the professional life of a business leader. And spirituality goes far beyond the time set aside for religious practice. That spirituality is inside of me, that spirituality is the compass in everything I do.
Is it a bold thing to say that executive corporate leadership is a vocation with equal dignity to that of a priest or a teacher? Perhaps. But consider that the average working adult easily spends 40 – 50% of their waking life at work. And that doesn’t even figure in the average commute. What a shame if that time is spent in spiritual sleep. The invitation to each of us is to be spiritually awake at work, which quite naturally invites others to awaken to their own spiritual nature.

Four Faculties of a Spiritually-Based Leader
Here are the four faculties of a spiritually-based leader:
1. Establish your spiritual context, that is: learn and validate what is a spiritual context to
2. Explore your spirituality from the inside out, that is: identify how you best grow your Spiritual awareness.
3. Embody spiritual principles in your leadership, that is: see what it looks like waking up as
a spiritual leader each day.
4. Engage in revolutionary activities, that is: stretch your ideas of what’s possible in who you are, what you can contribute, and how you can lead.
I’ve chosen the sequence for presenting these four faculties quite deliberately. The first, establish
Your spiritual context gets you going on your inner revolution with a firm foundation. The second explore your spirituality from the inside out, takes you even deeper. The third, embody spiritual principles in your leadership, begins your entry into your day-to-day world. Or, as my wife says, “Where you’re learning to play the violin in public.” The fourth, engage in revolutionary activities, takes you even further into the outer revolution making a spiritual difference in your world.
Let’s review each of these faculties and the practices that strengthen them. The first capability of a spiritually-based leader is to establish your spiritual context. In my love of reading scriptures from all around the world, there are two passages that really speak to me about this particular faculty. The first is from Corinthians in the New Testament of the Holy Bible, We are laborers together with God. And further from the Sufi’s book of Wisdom, among the signs of success at the end, is the turning to God at the beginning.

Establishing Your Spiritual Context
Establishing your spiritual context is the very beginning. Why do I say that? Why do I start here?
In a sense it is simply because you get to jump right in to the “heart” of the matter. The first
Practice to strengthen this capability is to define your own relationship between spirituality and religion. Many people have been thankful for this distinction between spirituality and religion; it removes a major stumbling block to engaging in this dialogue.

By William C. Miller
Co-founder, Global Dharma Center

© 2003 Global Dharma Center. Duplication IS permitted.

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