The book tries to answer two questions, says Professor Gordon:
1) How can organizations best address important societal problems such as poverty, inadequate health care, sub-par education, and an unhealthy planet?
2) What’s the best advice for students who want to address these issues and still live lives of relative comfort?
The reason I’m helping the professor is because now, more than ever, we need the brightest students to tackle the world’s biggest problems. And the oil-coal-nuclear lobby isn’t making things any easier…
Ever since the Haiti earthquake, I’ve been thinking about why we don’t have a quick-build house made of sustainable materials at a price point that the poor can afford (with micro-credit if needed).
The $300 House-for-the-Poor is an extension of the concept of “reverse innovation” (inspired by my client and friend VG) in which innovations developed in poor countries are then brought back for use in developed countries and other parts of the world. Housing impacts health, energy, education, and security.
What if we could build sustainably designed houses for the world’s poor at an affordable cost? What if these same designs could provide relief to refugees and victims of natural disasters? The we I’m referring to is a collaborative of companies, governments, and NGOs.
This type of a structure will be engineered in the same way the TATA Nano was engineered – without the traditional assumptions.
Once built, the $300 house should be used across the globe – from Haiti, to Africa, India, and yes, even in this country, to help the homeless.
So what are we waiting for? It’s time to get busy designing the $300 House!
How do you encourage curiosity across a global organization?
“Many consultants out there would rather just give answers and are even afraid to ask questions. We deliberately hire people who aren’t like that, even early in their careers, and senior consultants coach them on how to be inquisitive. Sometimes that means asking a client’s managers very difficult questions, really pushing them hard to reveal or do things they’re not comfortable with–getting a CEO to explain lagging sales, for example, or to acknowledge why a competitor’s pulling ahead. Other times that means encouraging constructive dissent–deliberately engaging with people who disagree with you and being willing to probe them on their point of view. That can be tricky, but persistent questioning usually produces the best solutions.”
How GE is Disrupting Itself describes the concept of reverse innovation – how products developed in and for low-cost countries (like India and China) by multinationals (like GE) lead to growth – not only in the low-cost market, but at home as well.
VG says the article has touched an “emotional” chord with readers who are saying that this approach is just what “western” multinationals should be doing – designing products for the local market at a price-point which is within reach.
Check out the advertisement for one such product:
To me, this is just the first step to being truly global (as they say at Thunderbird). With business commitments at a local level, social commitments will surely follow.
Now let’s see some “ecomagination” in action and build portable solar/wind electrical generators for off-grid villages at an affordable price-point. Right, Bob?
Vijay Govindarajan’s Innovation Quarterly is now open to subscribers.
It’s free, and it’s going to be good. Sign up if you’re interested in how innovation works. Disclosure: VG truly is one of the sharpest minds in the business world, and I’m privileged to work on his newsletter!
I know we are entreprenurial geeks, but this is a staggering statistic: Though Indians make up barely half a percent of the U.S. population, between 1995 and 2005, they founded more than 15 percent of all the startups in the greatest technological center (Silicon Valley) the world has ever known. Read all about it >>
Here’s my “Customer-Driven Innovation interview” with Gaurav Bhalla for the Emory Marketing Institute.
According to Bhalla, the key building blocks of value co-creation are: Listening: learning about consumers’ experiences; their angst, frustrations, desires, and aspirations
Sustaining value co-creation conversations: meaningful conversations that yield the raw material for co-creation Experimenting and rapid prototyping: to manage risk, improvise, and enable speedy value co-creation Execution: only when co-created value is delivered can the next round of value co-creation be initiated Read all about it >>
For decades nonproliferation experts have argued that, once unleashed, the nuclear genie cannot be stuffed back in the bottle. But they probably didn’t consider the possibility that a country with nuclear bomb-making know-how might forget how to manufacture a key atomic ingredient. Yet that’s precisely what happened to the US recently, and national security experts say this institutional memory lapse raises serious questions about the federal government’s nuclear weapons management. Whoops! Is this what a military-industrial complex “senior” moment looks like?
The Cluetrain posse continues their journey:
1. The Internet isn’t complicated
2. The Internet isn’t a thing. It’s an agreement.
3. The Internet is stupid.
4. Adding value to the Internet lowers its value.
5. All the Internet’s value grows on its edges.
6. Money moves to the suburbs.
7. The end of the world? Nah, the world of ends.
8. The Internet’s three virtues:
a. No one owns it
b. Everyone can use it
c. Anyone can improve it
9. If the Internet is so simple, why have so many been so boneheaded about it?
10. Some mistakes we can stop making already Details >>
A former senior managing director of Toyota Motor Corporation and renowned leader of their famous manufacturing system, Masao Nemoto is known throughout the world as a leader in quality control and process optimization. In a sense, he is one of the principal architects of the “Toyota Way.”
What we learn from Nemoto is far more than quality management. His ideas on leadership have been documented, and reveal the profound knowledge Nemoto infused into the day-to-day operations at Toyota.
One particular aspect of Nemoto’s thinking has been largely ignored by western companies to their own detriment: coordination between business units.
Nemoto insisted on a culture of shared responsibility. Here’s what Nemoto says: “One of the most important functions of a division manager is to improve coordination between his own division and other divisions. If you cannot handle this task, please go to work for an American company.”(see his 10 leadership principles below)
Nemoto believed that critical tasks could not be left to a single business unit, but rather should be a collective responsibility. What has this got to do with leadership?
Nemoto’s point of view says that leaders must lead across the company, not just their own fiefdom. It is ironic, to say the least, that the democratization of business happened first not in the West, but in Japan, at companies like Toyota. Or in Brazil, with Semco. Note: OK, there are a few American companies in this camp as well: Zappos and W. L. Gore & Associates…
Nemoto’s thinking went all the down to the individual worker on the assembly line. Everyone speaks, insists Nemoto, not just management. A direct result of this view is the work principle: problems must be solved at the lowest possible level. All employees take responsibility for problem solving, instead of pushing the issue upwards. Every worker in a process can be stop the work flow, without waiting for a supervisor to make the decision. It is this transparency which drives out defects and makes quality job one. Now wasn’t that a slogan we heard somewhere before?
Next time you bring your business unit heads around the conference table, ask yourself: “Are we competing against each other or against the competition?”
For reference, here are Nemoto’s 10 leadership principles: 1. Improvement after improvement. Managers should look continually for ways to improve the work of their employees. Advance is a gradual, incremental process. They should create all atmosphere conducive to improvements by others. 2. Coordinate between divisions. Managers of individual divisions, departments, or subsidiaries must share responsibility. Nemoto offers this advice to his managers:
One of the most important functions of a division manager is to improve coordination between his own division and other divisions. If you cannot handle this task, please go to work for an American company. A corollary of this is that upper management should not assign important
tasks to only one division. 3. Everyone speaks. This rule guides supervisors of quality circles at Toyota, ensuring participation and learning by all members. It has also been generalized to all meetings and the annual planning process. By hearing everyone’s view, upper management can create realistic plans that have the support of those who must implement them–an essential element in quality programs. 4. Do not scold. An alien concept to most managers. At Toyota the policy is for superiors to avoid giving criticism and threatening punitive measures when mistakes are made. This is the only way to ensure that mistakes will be reported immediately and fully so that the root causes (in policies and processes) can be identified and amended. Assigning blame to the reporter clearly discourages reporting of mistakes and makes it harder to find the underlying cause of a mistake, but it is difficult to train managers to take this approach. 5. Make sure others understand your work. An emphasis on teaching and presentation skills is important because of the need for collaboration. At Toyota, managers are expected to develop their presentation skills and to teach associates about their work so that collaborations will be fuller and more effective. 6. Send the best employees out for rotation. Toyota has a rotation policy to
train employees. There is a strong tendency for managers to keep their best employees from rotation. But the company benefits most in the long run by training its best employees. 7. A command without a deadline is not a command. This rule is used to
ensure that managers always give a deadline or schedule for work. Employees are instructed to ignore requests that are not accompanied by a deadline. The rationale is that without a deadline, tasks are far less likely to be completed. 8. Rehearsal is an ideal occasion for training. Managers and supervisors give numerous presentations and reports. In a QC program there are frequent progress reports. Mr. Nemoto encourages managers to focus on the rehearsal of reports and presentations, and to require that they be rehearsed. Rehearsal time is used to teach presentation skills and to explore problems or lack of understanding of the topic. Because it is informal, rehearsal time is better for learning. 9. Inspection is a failure unless top management takes action. The idea
behind this is that management must prescribe specific remedies whenever a problem is observed or reported. Delegating this task (i.e., by saving “shape up” or “do your best to solve this problem”) is ineffective. So is failing to take any action once a problem is defined. 10. Ask subordinates, “What can I do for you?” At Toyota this is called “creating an opportunity to be heard at the top.” In the first year of a quality-control program, managers hold meetings in which employees brief them about progress.
Three rules guide these informal meetings:
1. Do not postpone the meetings or subordinates will think their project is not taken seriously.
2. Listen to the process, not just the results, since QCs focus in on the process.
3. Ask the presenters whether you can do anything for them. If they ask for help, be sure to act on the request.
This philosophy can be generalized. If top management is perceived as willing to help with problems, employees are more optimistic about tackling the problems and will take management’s goals more seriously.
While reading these principles of Nemoto, I couldn’t help but be reminded of good old Deming.
The White House announced this morning that Vivek Kundra will be the administration’s Chief Information Officer.
It won’t be easy, since our government IT is basically a patchwork of competing departments (fiefdoms) and vendors (mercenaries) and CIOs (the entrenched aristocracy).
Here’s Kundra talking about his previous position:
‘ Steve Ballmer‘s probably having a fit over at MS right now. Here’s his Howard Dean moment.
So what can we expect from Kundra? Three things to look for:
1) Transparency: of costs and just as important, procurement processes
2) Lower costs: through the use of open apps like Google Apps
3) Virtualization: everything in the cloud…
And who is Obama going to bring in as Chief Technology Officer (CTO)? I’d like to see JSB, but I’m getting this “Google in the White House” feeling, i.e. Eric Schmidt…
Here’s a brilliant post from “decision-making” guru Tom Davenport. He asks us to “make 2009 the Year of Better Decisions.”
Here’s what Davenport recommends:
1) Make a list of key decisions: not all decisions are equal, so you have to ask yourself what the key decisions are.
2) Classify decisions by type: For example, is the decision financial, personal, strategic, or tactical? By deciding how to treat different types of decisions differently, companies (and individuals) can become more effective.
3) Track decisions and their outcomes: without this, you can’t improve your decision-making abilities. And if things did go wrong, why did it happen?
4) Establish a decision-making coaching group: to improve decision-making across the company!
5) Create a decision-making process for the company: how do we make this decision? Davenport gives us an example from Air-Products (the company which, I believe, initially decided that not using an ERP system would be a competitive advantage.)
I’d to bring Peter Drucker into the picture at this point. For Drucker, a decision has not been made until people know:
– the name of the person accountable for carrying it out;
– the deadline;
– the names of the people who will be affected by the decision and therefore have to know about, understand, and approve it—or at least not be strongly opposed to it—and
– the names of the people who have to be informed of the decision, even if they are not directly affected by it.
And one more crucial point from Drucker: Most discussions of decision making assume that only senior executives make decisions or that only senior executives’ decisions matter. This is a dangerous mistake. Decisions are made at every level of the organization, beginning with individual professional contributors and frontline supervisors. These apparently low-level decisions are extremely important in a knowledge-based organization. Knowledge workers are supposed to know more about their areas of specialization—for example, tax accounting—than anybody else, so their decisions are likely to have an impact throughout the company. Making good decisions is a crucial skill at every level. It needs to be taught explicitly to everyone in organizations that are based on knowledge.
I’m counting on Obama being a far-better decision-maker than Dick Cheney.
In my line work (consulting) I run into all kinds of executive mindsets. In the publishing world, however, these mindsets tend to be rather stodgy at best, reptilian at worst.
Publishers don’t understand the web. And Seth Godin takes the New York Times to task, pointing out so many obvious misses and near-misses, that you have to ask why. Why don’t publishers get it? Why do they insist on playing it safe, even as their ship sinks below them?
Godin’s answer is right on target: “organizations are run by people who want to protect the old business, not develop the new one.”
This is what VG talks about as well.
In just about any large company, the people running the show are great at yesterday’s business, not tomorrow’s.
Please read Godin’s post >>
Writes Zuboff in BusinessWeek:
“This column is dedicated to the top managers of American business whose policies and practices helped ensure Barack Obama’s victory. The mandate for change that sounded across this country is not limited to our new President and Congress. That bell also tolls for you. Obama’s triumph was ignited in part by your failure to understand and respect your own consumers, customers, employees, and end users. The despair that fueled America’s yearning for change and hope grew to maturity in your garden.”
Years ago I remember reading Zuboff’s In the Age of the Smart Machine and thinking that no one in corporate management really wants real transparency… and that the information value-chain she described was doomed to failure.
Luckily, I was wrong. Now Obama will bring process transparency to government and business.
“…can we invent a business model in which advocacy, support, authenticity, trust, relationship, and profit are linked?”
“Yes, we must,” she concludes.
Read the article >>
And read her book: The Support Economy: Why Corporations Are Failing Individuals and the Next Episode of Capitalism >>
“The stark truth is that the U.S. has no long-term economic strategy—no coherent set of policies to ensure competitiveness over the long haul. Strategy embodies clear priorities, based on understanding the strengths we need to preserve and the weaknesses that threaten our prosperity the most. Strategy addresses what to do, but also what not to do. In dealing with a crisis, experience teaches us that steps to address the immediate problem must support a long-term strategy. Yet it is far from clear that we are taking the steps most important to America’s long-term economic prosperity.”
That’s the Portermeister in BusinessWeek.
What he’s saying is Vote Obama 🙂
In this month’s Harvard Business Review, authors John Hagel III, John Seely Brown and Lang Davison provide a road map for the daunting task of shaping strategy as technology-driven infrastructures constantly change.
The article is called: “Shaping Strategy in a World of Constant Disruption” and you can download it here (thanks Deloitte Consulting!) >>
In my view this is a very timely piece of thinking from my heroes JH3 and JSB (and Lang Davison). I’ll dig into it later this month on ecosystemwatch.com…
Wait, there’s more. Check out the podcast >>
Looks like Rupert Murdoch’s WSJ is thinking along the same lines we are (for a few seconds at least).
They’ve gone an dug up an old article Peter Drucker wrote for them: Planning for Uncertainty.
Here are some of the key questions:
– …traditional planning asks, “What is most likely to happen?” Planning for uncertainty asks, instead, “What has already happened that will create the future?”
– “What do these accomplished facts mean for our business? What opportunities do they create? What threats? What changes do they demand — in the way the business is organized and run, in our goals, in our products, in our services, in our policies? And what changes do they make possible and likely to be advantageous?”
– “What changes in industry and market structure, in basic values (e.g., the emphasis on the environment), and in science and technology have already occurred but have yet to have full impact?”
– “What are the trends in economic and societal structure? And how do they affect our business?”
– “What is this company good at? What does it do well? What strengths, in other words, give it a competitive edge? Applied to what?”
He ends with a serious warning for the bean-counters: There is, however, one condition: that the business create the resources of knowledge and of people to respond when opportunity knocks. This means developing a separate futures budget.
The 10% or 12% of annual expenditures needed to create and maintain the resources for the future — in research and technology, in market standing and service, in people and their development — must be put into a constant budget maintained in good years and bad. These are investments, even though accountants and tax collectors consider them operating expenses. They enable a business to make its future — and that, in the last analysis, is what planning for uncertainty means.
And don’t forget his advice for retail strategy >>
I have to say I was shocked when I saw the news about Michael Hammer. He was just sixty. Goes to show you how precious every second is. It may be that they need to do some process re-engineering up in heaven. Maybe make it more customer friendly or something…
I love stumbling upon old Peter Drucker interviews. The insights he throws out with just about every breath are astonishing.
Here he is on knowledge productivity: “There has been no increase in the productivity of knowledge work. I began to teach on my twentieth birthday. November 19, 1929, I gave my first university lecture. There has been no improvement in the productivity of college faculty since. If anything, it has gone down, because of committee meetings.
My distinguished colleagues spend God only knows how much time in committee meetings, and there has never been a committee meeting that produced any results. President Roosevelt said, If I want to make absolutely sure that nothing gets done, I appoint a committee.”
Good to know that committees still rule the world of both corporate and government decision-making.