Marina Gorbis's Blog, page 1313

Get Your Employees to Make Better Suggestions

Leaders often have a hard time getting their employees to speak up honestly about what’s really going on in their organizations. Far too often, employees willfully choose to self-censor out of a fear of negative repercussions to their career or social standing. Yet, when employees do choose to speak up, research suggests that a host of positive things can happen, including higher employee engagement and job satisfaction, greater learning, enhanced innovation and creativity, fewer accidents and safer workplaces, and even better unit financial performance.

The implicit assumption here is that if several things happened — leaders made it clear that speaking up is expected, encouraged, and safe and employees worked to overcome their fear, practiced speaking up skills, and in the process became more confident in their ability — the problem would be solved. Leaders would hear all they need to hear, right?

Not so fast.

Review the open-ended comments on an employee survey, the ideas coming into a suggestion box, or for those of us academics, student feedback from recent teaching evaluations, and it quickly becomes clear that all voice is not created equal. Consider meetings — individuals often go off on tangents or share personal, irrelevant opinions or stories. Simply put, not all voice is good voice and merely increasing the frequency and volume of speaking up is not enough.

The first step to getting helpful, constructive feedback is to admit that you as a leader don’t always have the answers. Your focus should be on accomplishing the goal, not advocating for your particular idea about how best to achieve it. Yet, for many leaders, relinquishing commitment to their own solutions and ideas is difficult, particularly for those who are insecure about their own abilities or view their followers as a potential threat to their position or status in the organization. In order to create an environment for constructive voice, however, it’s essential.

Once you’ve established that foundation, there are several ways to increase the probability that your employees will speak up with thoughtful, well-informed ideas. Here are our recommendations based on our personal experiences working with leaders and our own and others’ academic research:

Put limits on your supportiveness. Being supportive can backfire especially if you unintentionally send the message that all voice is equal. Make clear that you value thoughtful input more than just any input. Encourage employees to think about issues from your perspective, factoring in potential constraints, obstacles, and multiple stakeholders. One way to do this is by creating targeted campaigns where, for a limited period of time, you encourage people to come up with ideas that address a particular strategic imperative or challenge. For example, think about a situation where an organization wants to encourage customers to go to their website rather than call their toll-free number. Here the leader can clearly define the problem, along with any constraints or potential issues that need to be considered. After helping employees understand the problem and the broader context in which it’s situated, the leader could kick off a three-week ideation period during which employees submit ideas to a knowledge database and then revise each other’s ideas and vote on the best proposals.

Be accessible but demand high accountability. Some employees are only reluctant to speak up in group settings such as meetings. In such cases, personally inviting them to share their thoughts and concerns with you privately may yield more and better insights. This may involve going by their office and soliciting input directly or scheduling regular one-on-one check-ins. At the same time, set high expectations to encourage high-quality input. For example, prior to beginning any meeting, set a clear agenda and frame the purpose of the ensuing conversation (e.g., “OK, so we have 60 minutes set aside to focus on topic X today, where we really want to flesh out Y particular challenge.”), and also demand high performance (e.g., “This is a critical juncture for this project and I really need you to bring your best ideas.”).

Help people see their biases. Most employees will view a particular policy or process from a narrow, functional perspective and very few recognize that they have such a biased view of the situation. You’ll get better input if you help employees understand the bigger picture before proposing a solution. You might suggest team members hold a meeting (or meetings) with various key stakeholders to better understand the problem, situation, or concern before proposing their own solution. For example, if a particular policy is frustrating an employee, ask that she meet with people who were involved in creating or implementing it to understand its purpose, the history of how it came about, and what was tried previously. With this perspective, the employee can then propose a much more well-informed, workable solution that satisfies the overall goal.

Find influential “informants.” You’ll get better input if you have someone screen ideas for you. Recruit trusted informants to collect feedback from their peers, aggregate this input, and provide you with the best ideas. Since these informants are gathering informal feedback from their peers and presenting it to you anonymously, there’s the added bonus that employees likely will be more forthcoming in their observations.

Close the loop. Employees who take the time to learn the broader context and voice constructive suggestions deserve feedback on what you did—or didn’t do­—with their input and why. Closing the loop not only encourages employees to continue to speak up, but encourages others as well, when they see that voicing opinions constructively has a meaningful, positive impact.

When asking employees to speak up, be careful to not open the floodgates to a river of ideas that aren’t particularly thoughtful or useful. Instead, encourage people to make the effort to give input that is informed and constructive.

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7 Ways to Capture Someone’s Attention

Your long-term success depends on winning the attention of others. If your boss doesn’t notice your work, how will you get a promotion? If your team doesn’t listen to you, how can you lead effectively? And if you can’t capture the attention of clients, how does your business or career survive?

“Attention is the most important currency that anybody can give you,” Steve Rubel of Edelman once told me. “It’s worth more than money, possessions or things.”

But very few people know the science behind captivating others. That’s why I spent two years researching the subject for my new book. I sifted through more than 1,000 psychology, neurology, economics, and sociology studies. I interviewed dozens of leading researchers and attention-grabbing thought leaders, including Sheryl Sandberg, Steven Soderbergh, and David Copperfield, just to name a few. And I drew on my years of experience with startups, both as co-Editor of Mashable and a venture capitalist.

I learned that there are seven triggers that call people to attention:

Automaticity. If somebody fires a gun in the air, you’re going to turn your head. If a female hitchhiker wears red, she’s more likely to get picked up. Sensory cues like these to direct our attention automatically. It’s a safety and survival mechanism that helps us react faster than our brains can think. I’m not suggesting you speak louder than everyone else and always wear crimson dresses or socks. But think about more subtle ways to play on people’s instincts to capture attention. For example, try giving a star prospect or client a hot cup of coffee or tea. One study published in Science found that exposure to that kind of warmth made them more giving and friendly.

Framing. Our view of the world is shaped by our biological, social, and personal experiences and biases. These frames of reference lead us to embrace and pay attention to some ideas and to ignore others entirely. To leverage this trigger, you have to either adapt to your audience’s frame or change it. One technique you might use to achieve the latter is repetition. A classic study from the 1970s found that if you expose subjects to the same statement (e.g. “Tulane defeated Columbia in the first Sugar Bowl game.”) repeatedly, they will start to believe it is true. So don’t be afraid to repeat a message if you want it to sink in.

Disruption. We pay special attention to anything that violates our expectations. This is because we have an innate need to figure out whether the incident signals a threat or a positive development. In academic circles, this is known as expectancy violations theory. The more disruptive something is, the more interesting it becomes. To get the attention of your bosses, clients and colleagues, try surprising them in a positive way: ask an unexpected question, beat a tough deadline, invite them for a walk instead of a coffee.

Reward. Many people believe the neurotransmitter dopamine causes us to feel pleasure. But, according to Dr. Kent Berridge of the University of Michigan, it is much more aligned with anticipation and motivation. It fuels our desire to “want” food, sex, money or more intrinsic rewards like self-satisfaction and a sense of purpose. The prospect of capturing these things makes us pay attention. Your goal as a manager should be to identify the incentives that most appeal to your employees, colleagues and bosses and to make them more visceral in their minds. Rewards we can touch, experience, or even just visualize have a greater impact on our attention. For example, when you’re offering your team an off-site retreat at the end of a big project, don’t just tell them about it – send them pictures and make them salivate.

Reputation. Consumers consistently rate experts as the most trusted spokespeople, more than CEOs or celebrities. There’s a scientific reason for this: in a 2009 study, Emory University neuroeconomist Greg Berns found that the decision-making centers of our brains slow or even shut down while we are receiving advice from an expert. This is a phenomenon Dr. Robert Cialdini calls “directed deference.” So, especially if you’re trying to capture the attention of people who don’t know you, feel free to lead with your credentials, establish your expertise and cite others who are most knowledgeable on the topic at hand.

Mystery. Ever wonder why we’re unable to put down a good book or stop binge-watching shows like Lost? Our memory is fine-tuned to remember incomplete stories and tasks. There’s actually a scientific term for this: the Zeigarnik effect, named after the Soviet psychologist who discovered it. We also dislike uncertainty and will actively try to reduce it by any means possible, and you can use this to your advantage. Say you’re meeting with a prospective client or recruit, and you’d like her to come back for a second meeting. Tell her a story or assign yourself a task that you’ll complete when she does. Her compulsion for completion will nag at her, which means you’ve got her attention.

Acknowledgement. Dr. Thomas de Zengotita, a media anthropologist and author of Mediated, believes that acknowledgement – our need for validation and empathy from others – is one of our most vital needs. “All mammals want attention,” he told me. “Only human beings need acknowledgment.” Key to this is a sense of belonging to a community that cares about us. Create that feeling for anyone whose attention you’d like to capture, and they’ll repay you.

The most effective employees, managers, and executives are the ones who use these seven triggers to shine a spotlight on their ideas, projects, and teams. Understanding the science of attention is a prerequisite to success in the information age.

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When Not to Treat a Colleague as You’d Want to Be Treated

Roger was a young rising star. He had always been successful, and prided himself on his brains, speed, and ability to deliver impressive results. His company had just appointed him to take over a troubled country operation in Latin America. He did a brilliant job turning things around financially. But he then got completely stymied by a group of angry employees who started a covert revolution in the ranks — and almost succeeded in getting him fired.

Coaching Roger, I suggested he was a bunny rabbit who had just been attacked by a horde of guinea pigs. When he looked bemused, I suggested that the world is made up of two sorts of people, but only one sort would agree.

Bunny rabbits are convinced that everyone is more or less the same: human, and much like themselves. They bounce through life in a relatively self-sufficient way, open to others but not living their lives in reaction to them. Their deep-seated belief that others are mostly like them leads them to treat others as they would like to be treated themselves — an approach they take pride in as an enlightened and open-minded management approach.

Roger was a classic rabbit. He was a highly ethical, performance-driven manager, and assumed everyone else was (or should be) too. He gave his employees exactly the kind of hands-off autonomy that he had always appreciated. But when they didn’t deliver, he thought they were shirking their responsibilities and started to put the pressure on. It never occurred to him that what the team really wanted was his attention, his direction or, worst of all, his love. When he judged them for under-performing, their admiration quickly turned to fear — and anger.

Guinea pigs have a tendency of comparing themselves to others — and rabbits don’t. Rabbits are busy chasing some internal mission, vision, or benchmark. Guinea pigs tend to measure themselves against others. And when they compare to a perceived rabbit, they feel lesser in some way. This creates a range of reactions ranging from admiring, to judgmental, to angrily jealous.

Guinea pigs often love rabbits, at first. They are ready to admire and follow and emulate. They put the bunny on a bit of pedestal. They feel cuter, fluffier, and bouncier in their company. They can make for loyal friends, partners, or colleagues, as long as they feel cared for and recognized. But there is often an underlying — and largely unconscious — set of expectations in the relationship that many rabbits won’t have recognized. So when a problem arises and the rabbit becomes less cuddly-bunny and more fighting-hare, guinea pigs may feel that their diligent loyalty has been betrayed, and turn angry. And angry guinea pigs can become vengeful and dangerous. They can ally with other resentful guinea pigs and descend on the unwitting bunny in a sometimes-lethal swoop.

What about the bunny? Since a rabbit’s basic assumption is that they are like anyone else, they never fully understand how guinea pigs think. It’s a huge blind spot. They under-estimate how much a guinea pig looks up to them and expects of them. They usually get into trouble with guinea pigs when they try to end or question relationships, or strike out more independently, or start to shine too brightly on their own. Success, which usually comes easily to bunny rabbits, exacerbates the initial positioning — the guinea pig feels like more of a guinea pig, the bunny rabbit begins to feel uncomfortable in their presence, and not understanding what is going on, finds refuge in the company of other rabbits. This exacerbates the guinea pig’s feelings of exclusion.

Another coaching client, whom I’ll call Maria, found herself encircled by guinea pigs in a big new job she had recently taken on, running a national sales operation in the UK. She was a very successful and highly regarded executive who had recently changed firms. She now managed several people who used to be her peers in the industry. A small number of them resented her success, felt that she was not paying enough attention to them, and worked in unison to make life difficult for her. The angrier and more demanding they became, the more Maria retreated behind emails, avoiding direct contact with them, and the more she focused on the rest of the team — fellow rabbits who were thrilled to have such an experienced and empowering leader on board. This made the guinea pigs go into loud, and united, over-drive. Management saw this as Maria’s key leadership challenge — getting her whole team on board.

So how do you deflect the almost inevitable conflicts that arise? First by noting that both these labels are situational. They describe a state of mind vis-a-vis others. You can be a bunny rabbit in most situations, but find yourself a guinea pig with a particular person or social group. I’m usually a pretty fluffy bunny, but there are a few people and situations that immediately put me in guinea pig mode. My tendency there is to attack, criticize, or find fault. I’ve learned that I’m usually the only person this sort of thing harms, as it cuts me off from more powerful people who would probably be happy to help me. Now, I try and calm the envy by consciously putting myself in bunny mode and reaching out to meet the person halfway. Most of the time, to my continuing guinea pig surprise, they do.

Most people tend to side with guinea pigs, assuming that bunny rabbits are as strong and invulnerable as they often come across.  People feel that the last thing a rabbit needs is sympathy. But having been the bunny in a few relationships, and having coached many more, I know just how hurt and confused a bunny gets when it is first envied — then attacked.

So what’s the solution?

Rabbits need to:

Recognize that guinea pigs may require more support, empathy and encouragement than other rabbits.
Understand that your impact on a guinea pig is many times greater than you imagine.
That one of the keys to turn guinea pigs into rabbits is to reveal that you aren’t as perfect as you may seem to them.


Guinea pigs need to:

Acknowledge and recognize that they are projecting unrealistic images onto someone.
Name the emotions underlying their judgement of the rabbits — is it fear, envy, jealousy, inferiority, a mix of all of these?
Avoid making assumptions. Reach out to enough rabbits to realize that they are human too.

The challenge is that the solution comes far more easily to the (usually unsuspecting) rabbit than to the (situation-creating) guinea pig. It takes a lot for a guinea pig to confront a rabbit. But once a rabbit “gets it,” it costs them very little to adapt their behavior to be more inclusive and supportive of a guinea pig. And that’s often enough to bring out any guinea pig’s inner rabbit.

It’s in the interest of every rabbit in the world to help guinea pigs grow their ears. Otherwise, they come and bite off your tail.

It’s your choice.

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Is Social Media Actually Helping Your Company’s Bottom Line?

When it comes to business, we talk too much about social media and expect too little. It’s like the old joke about sales people: one person says, “I made some valuable contacts today,” and the other responds, “I didn’t get any orders, either.” Companies measure the market results of their sales investments. But few have measures or even have accountable managers in place for their social media investments, and only 7% say their organizations “understand the exact value at stake from digital.” Meanwhile, according to a Gallup survey, 62% of U.S. adults who use social media say these sites have no influence on their purchasing decisions and only 5% say they have a great deal of influence.

Consider:

The most common metrics for evaluating social media are likes, tweets, reviews, and click-through-rates (CTRs) for online ads — not cause-and-effect links between the medium and market results. The basic investment logic is typically no deeper than a version of “Fifty million tweets or likes can’t be wrong” . . . or can they? There is justifiable skepticism about this data. Farming services spike these numbers, with evidence that one in three online reviews is fake. For $50, you can buy 1,000 Likes, 5,000 Twitter followers, or 200 Google +1s. With real people, moreover, 8% of internet users account for 85% of clicks on display ads, and 85% of social media updates come from less than 30% of a company’s social-media audience. One online reviewer, Harriet Klausner, has reviewed more than 25,000 books.
A Forrester study found that posts from top brands on Twitter and Facebook reach just 2% of their followers (note: that’s followers, not new customers) and only 0.07% of those followers actually interact with those posts. As others have noted, people are more likely to complete a Navy Seal training program or climb Mount Everest than click on a banner ad.
There are, as always, opportunity costs. Since 2008, according to a McKinsey study, companies have devoted more time and money to social networks and 20% less to e-mail communications. Yet, the same study found that humble e-mail remains a more effective way to acquire customers — nearly 40 times more effective than Facebook and Twitter combined. Why? Because 90% of U.S. consumers use email daily and the average order value is 17% higher than purchases attributable to those social media.

Technology changes fast — remember MySpace and Friendster? — but consumer behavior changes more slowly. As a result, people tend to overhype new technologies and misallocate resources, especially marketers.

When banner ads first appeared their CTR was 10%, but that soon fell due to heavy usage by firms, and clutter. Research has long demonstrated that ad elasticities are generally very low, that firms often persist with ineffective ad media (because they have the wrong measures or no measures), and that companies routinely over-spend on ads (due to ad agency incentives, the fact that ad expenses are tax-deductible, and companies’ use-it-or-lose-it budgeting processes). Other research indicates that traditional offline consumer opinion surveys (when they use representative samples) are better at predicting sales than clicks, number of website visits or page views, positive or negative social media conversations, and search (although online behavior is good at tracking the reasons behind week-to-week changes in sales.)

With new media, therefore, great expectations are common and missing the goal is understandable: it takes practice and learning. But changing or dismantling the goal posts is a different story.

It’s now common to say that social media is “really” about awareness, not sales. Companies that “get” social media should be “relentless givers [who] connect instead of promote.” In fact, forget “traditional” ROI (that lovely qualifier), focus on consumer use of social media and, instead of calculating the returns in terms of customer response, measure the number of visits with that social media application. How convenient: to be evaluated with a metric without tangible marketplace outcomes. But it’s wrong, a circular argument, and smart companies should not follow this flawed business logic.

The value of any advertising, online or offline, depends on what effects it has on purchases. As Bill Bernbach, David Ogilvy, and other ad execs have emphasized, “our job is to sell our clients’ merchandise, not ourselves.” Those effects are difficult to measure, because consumers buy (or not) for many different reasons and even good ads in the right media have both carryover and wear-out effects that vary over the product life cycle and an ad campaign. But to justify an investment by activity and not outcomes is a tautology — we advertise because we advertise — not a meaningful business argument.

Even an activity measure, moreover, assumes the consumer can see the ad. Did you know that a display ad is deemed “viewable” if at least half of each ad is visible on your computer or smart phone for a minimum of one second? Data released in 2014 by comScore indicated that more than half of online display ads appear on parts of a web page that are not viewable. In response, the Interactive Advertising Bureau noted that for various reasons 100% viewability is “not yet possible,” but the industry should aim for 70%. In other words, hope that “only” 30% of your intended ads are not seen by anyone for at least a second!

Further, what we now know about shopping and social media activity says that online and offline behavior interact. They’re complements, not substitutes, and you ignore these interactions at your peril. The vast majority of communications on social media sites are between friends who are within 10 miles of each other. The same is true about the available data on buying behavior. As Wharton professor David Bell documents, the way people use the internet is largely shaped by where they live, the presence of stores nearby, their neighbors, and local sales taxes.

For years now, we have heard big talk about the big data behind big investments in social media. Let’s see who is behind the curtain. It’s time to expect more from social media and prove it. The Association of Advertising Agencies has refused to endorse the 70% goal and wants 100% viewability, which means if an advertiser buys 1 million impressions from a site, that site must display that ad as many times as it takes to ensure a million viewable impressions. In 2014, The Economist guaranteed those who buy space on its apps and website that readers will spend a certain amount of time there. For instance, it will guarantee that a site containing an ad appearing for three weeks will receive X hours of readers’ attention — documenting, not assuming, engagement with the medium.

Other companies try to trace the links (or not) between online platforms and sales outcomes. They buy point-of-sale data from retailers and have systems that purport to match Facebook or Twitter IDs, for example, with a given campaign and subsequent retail sales for a product. The validity of these approaches is still to be determined. And the FTC has raised concerns about privacy issues and disclosure practices, and has urged Congress to pass legislation to give consumers the right to opt out. But shining light on what does and doesn’t happen here will be a good thing.

Business success requires linking customer-acquisition efforts with a coherent strategy. You can’t do that if you are not clear about the differences between hype and reality when it comes to buying and selling. And we should care about this distinction for reasons that go far beyond making even more ads more viewable. Companies’ abilities to make better use of their resources are important for society, not only shareholders. It spurs productivity, and productivity — not just tweets and selfies — is what spurs growth.

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The Kind of Homework That Helps Coaching Stick

Managers can have a powerful, positive impact on their employees’ performance, engagement and development through coaching. When skillfully done, it can help employees clarify meaningful goals and make progress toward achieving them. But, many managers make the mistake of stopping the coaching process at the end of each conversation. You’re likely to get better results if you end each  session with something for your employee to take away and work on independently — homework.

Coaching homework might come in the form of an inquiry to ponder, an assignment to complete, or an experiment to try. Occasionally, you might also agree on homework for yourself, such as introducing your employee to someone from whom they can learn, or seeking authorization for training expenditures.

In order to give your employees meaningful homework, lay the groundwork by stepping out of the directing role and into a listening and learning role. By asking open-ended questions, listening actively, and engaging respectfully with your employees, you build the trust and rapport that is the lifeblood of effective coaching. As you gain greater insight into your employee’s thinking, motivations and interests, you’ll be better able to challenge and support him or her with homework that stimulates learning and development.

Coaching homework should help an employee make progress towards achieving a goal that he or she cares about. Sometimes the coach may suggest a homework assignment; other times the coachee may propose one. Either way, devising appropriate homework involves talking with the employee about what sorts of behaviors and experiences are likely to facilitate goal achievement, as well as what metrics can be used to measure progress toward that goal. These activities and metrics help build structure, accountability, and results into the process.

You and Your Team



Coaching


Get better at helping your employees stretch and grow.

Homework varies according to the type of coaching you’re doing. For example, performance coaching homework often focuses on practicing a skill (such as facilitating team meetings or presenting) or devising and implementing a solution to a performance challenge (such as asking for help as soon as problems arise or delegating work effectively). A professional I’ll call Anne was frustrated by her inability to speak up and command attention in meetings. Although knowledgeable, analytical and highly insightful, she struggled to be heard in a firm where the culture was described as a “free-for-all” that favored informal and often aggressive communication. Her performance reviews suffered, causing her even greater anxiety. To progress, Anne needed tasks and tools that would enable her to overcome her anxiety and learn to communicate more powerfully.

We devised a series of assignments and experiments that appealed to her research background, mentally shifting her view of herself from a helpless person in jeopardy to a social scientist analyzing the firm’s communication patterns. She mapped and notated the flow of communication during meetings to examine what types of messages had most impact, who had greatest influence, and what the most influential communicators did. She experimented with a variety of communication behaviors, such as raising a hand and continuing to speak when interrupted and avoiding the use of qualifying phrases like “I could be wrong, but.” She recorded the results, and reported them during our coaching conversations. These assignments helped her to identify and practice a set of communication strategies — challenging others, using humor, and making concise, persuasive summaries of her main points. Once she became comfortable with these strategies, she deployed them to excellent effect, increasing her performance and influence in the firm as well as her own self-confidence.

When you’re coaching an employee in order to support career development, you’ll want to identify activities that help make progress toward a specific career goal. It might entail gathering information, forging a new relationship, taking on a new project, trading responsibilities with another employee, or planning workflow to accommodate training time. Identifying meaningful homework for career development starts with asking questions about the employee’s developmental goals, such as:

What would you like to learn during the next quarter?
What projects would you most like to work on? How would working on them serve your goals?
What roles in the organization would you like to learn more about?
In what ways do you think you could add greater value to the organization?
Improvement in what skill would have the greatest impact on your career development?

George had been managing a family-owned agricultural products company for 12 years when I met him in an executive program. His small team of account managers was stable and performed well, but he was aware of a growing sense of stagnation among them, and was also eager to find ways to harness each manager’s strengths and interests in order to reinvigorate them and the firm. Through a series of coaching conversations beginning in the late spring, he began laying the groundwork for each account manager to have a month of focused developmental time during the firm’s seasonal downtime in the late autumn and early winter. Each member of the team was responsible for devising a project-based learning activity that would serve his or her own developmental goals while also contributing to the success of the firm. These employee-initiated action-learning projects ended up bringing about an impressive modernization of the firm’s talent management processes (specifically, the institutionalization of formalized learning and development programs), an increased sense of team cohesion and innovative capacity, and improvements in each participant’s performance as a manager.

Regardless of what form it takes, effective coaching homework is always employee-centered. Under no circumstances should the homework ever be busywork that creates low-value tasks for the employee. When coaching, managers must avoid the insidious tendency to assign something that’s not valuable just for the sake of having assigned something, or to assign homework that serves the manager’s needs more than the employee’s.

Any developmental experience can be made more valuable by taking the time to reflect on it. Regardless of what activities you ask your employees to complete in between coaching conversations, having them record and share what they did, any challenges they experienced, what the results were, and what they learned from the experience is a best practice. In addition to boosting your employee’s learning, it will also help you to develop as a coach.

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Why Our Trust in Banks Hasn’t Been Restored

Since the financial crisis of 2008, a major question has been how banks can restore the trust of their clients. To address this concern, banks have been hiring an increasing number of compliance officers. For example, JP Morgan has hired an additional 13,000 people in the area of compliance since 2012.

And yet it’s fair to say that this strategy of rebuilding trust has more or less failed. The latest Edelman Trust Barometer – an annual survey conducted across 27 countries that assesses attitudes about the state of trust in different institutions – shows that very little has changed since 2008, and the only industry trusted less than finance and banking (and by just a hair’s breadth) is the media.

Banks might be better served by focusing less on compliance and more on benevolence. Research has demonstrated that perceived trustworthiness includes three elements: ability (are you competent?), integrity (are you honest?), and benevolence (do you care about my interests?). Both competence and integrity are recurring themes in many discussions concerning the financial crisis. Benevolence, however, is not used very often – if at all. At the same time, banking clients particularly express concerns about whether the bank cares about their interests as well as its own interests. Put simply, a certain “morality of care” is missing in the discussion. As a consequence, it also seems to be missing from efforts to restore trust in banks.

Research by Madan Pillutla, a professor at the London Business School, and his colleagues provides strong evidence for the importance of benevolence.  They examined trust development in the context of a game. In the game, Player 1 has to decide how much money of a fixed endowment to send to an anonymous Player 2. Any amount sent will be tripled. Player 2 then decides how much to give back to Player 1. It is clear that by enlarging the pie both parties can earn more, but this can only be done when Player 1 trusts Player 2. The results showed that only if Player 1 gave almost everything or everything from his or her endowment did Player 2 reciprocate and both earn significantly more after simply one round.

The message is clear: only if you signal benevolence clearly – indicating you care about the other’s interests – do people reciprocate, leading to long-term and trust-building relationships.

But I’m not sure that bankers realize how important benevolence is. A remark by an investment banker I recently spoke with may be very telling in this respect. He told me that in his profession benevolence does not exist, nor is it necessary.

Why would he think that? Some of my own recent research indicates that it may be because he spends a significant portion of his day thinking about money. I conducted a study that used the same trust game mentioned earlier, and found that working directly with money may undermine benevolence-driven actions and decisions. I primed a set of people in the Player 2 role to think of money by instructing them to describe five characteristics of a one-dollar note. This group did not reciprocate the benevolence communicated by Party 1 participants. But when I gave a control group of Player 2 participants the financially neutral task of describing a wooden chair, they did reciprocate. These results indicate that once money is on your mind, you’re less likely to care about others’ interests.

But bankers beware. It’s not enough to simply say you care. The recent experience of a client of an internationally renowned bank illustrates this very well. A prospective client asked about opening a new account, and the banker explained that he had to ask several questions meant to protect the client’s interests. After half an hour, the client asked the banker whether he had to go through the list of questions frequently. The banker nodded and said he did this several times per day, but it was worth it because clients mattered. A few minutes later, the client asked the banker whether he could tell her two questions that were on that list — without looking at it. The dumbfounded banker could not recall any of the questions. At that point, the client left his office, saying she did not understand why he was telling her the bank cared about her when he could not even recall the questions that were supposedly in place to protect her.

The message is clear here: you must be sincere in caring about others. And it is exactly the fact that banks do not believe in benevolence, and thus do not signal it as an important value to their employees, that leads to clients not trusting them.

Trust will be built only when clients perceive that benevolence, truly felt, is underlying the decisions and actions of their bank. It is imperative that banks are able to connect with their clients on a personal level. Unfortunately, banks are increasingly investing in the efficient use of IT applications, and as a consequence are removing the personal element necessary for true benevolent interactions with clients. And until the board and top management model the value of benevolence – as something to demonstrate, not just talk about – levels of trust will remain low.

Hiring more compliance officers is not going to help. Instead, banks must recognize that winning the trust of their clients will take more than complying with the law.

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The Difference Between Coaching Rookies and Veterans

After years of playing at the top of his game, Tiger Woods hit a rough patch, struggling to win major tournaments. In February 2015, he pulled out of the Honda Classic, declaring his play “not tournament-ready.” Paul Azinger, ESPN sports analyst, claimed that Woods had become mechanical and “over-engineered himself out of being great.” The commentators suggested that Woods didn’t need learning; he needed un-learning.

Depending on where a professional athlete is in his career — a rookie new to the game, a star at the peak of his career, or a seasoned player, like Woods, who is struggling to get back on track — he requires very different coaching. The same is true in business.

Experienced professionals have deep knowledge, credibility, and confidence. But their knowledge can interfere with their learning. They can miss important shifts in the market simply because the telltale signs don’t fit nicely within their models. Having seen the patterns, they can easily overlook errors or dismiss aberrant results. They also receive little feedback because they’re performing relatively well and others assume they’ll figure out how to improve the less-than-effective portions of their work on their own.

On the other hand, when someone is new to a task, they have lower levels of confidence, which means they will tend toward caution, taking small steps. They lack knowledge but are more willing to ask questions, listen, and seek expertise and guidance from their colleagues. They are eager to act, but can make rookie mistakes.

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Both scenarios can lead to top performance. (In fact, my research has shown that in knowledge industries, rookies tend to outperform experienced staff in innovation and speed). But, they necessitate very different coaching styles. For example, your inexperienced people need support to channel their efforts, while your more experienced team might need encouragement to get out of a rut. Here are several ways you can adjust your approach based on where someone is on the learning curve:

1. Giving feedback. It goes without saying that both rookies and veterans need feedback, just different types. A study published in the Journal of Consumer Research suggests that rookies seek and respond to positive feedback, whereas veterans seek and respond to negative feedback. Inexperienced staff are desperately looking for clues that they’re on track. So shower them with messages that they’re headed in the right direction. Tell them what they’re doing well, reaffirm their actions, and help them build confidence.

While your rookies need validation, your experienced employees need calibration – corrective coaching to let them know when they’re veering off course. Just like a thermostat receives periodic readings of actual room temperature, experienced professionals require a steady flow of information to maintain high performance. Give your seasoned staffers more feedback than they appear to need and let them know where they are missing the mark and need to make adjustments.

2. Providing direction. Rookies tend to work fast, but they can get too focused on the wrong problem. A commanding officer in the U.S. Navy said, “Rookies are all thrust and no vector.” They’re full of energy and willing to do the work, but they need to be pointed in the right direction. Help them understand the rules of engagement and lock in on the right target. If they start to wander, try these questions: What is the fundamental goal? Who is your most important customer? What’s an achievable win toward this goal?

Experienced staffers typically know how to identify the right problem. However, they can get stuck running the same old plays. Coach them to see new, more efficient paths to the goal. Or help them improvise by using the resources at their immediate disposal rather than waiting for the typical resources to arrive.   Use questions such as: What’s the simplest route to the goal? What could you accomplish with the tools and resources available today?

3. Making connections. Your rookie employees will typically have weak networks, so introduce them to experts who can provide guidance. With that said, there may be times when you want to undercoach them. For example, Michael Fertik, CEO of Reputation.com, told me he is careful not to tell new sales people (many of whom are new college graduates) where to start in the sales process. He says, “In the absence of knowing, they often just start the conversation at the top of the organization.”

While your experienced people typically have more established connections, their networks might be echo chambers that bounce back the same old ideas and yield shallow, inbred thinking. Your most valuable role as a coach might be helping them see what they can’t see on their own. Help them reach out to new constituents and elevate new voices — especially those who will question the status quo. Ask: Who is on the fringe of this issue who might have a perspective we need to understand? Who can you consult with who would challenge this point of view?

When you adjust your coaching to each person’s experience level, you’ll keep your team performing at their best and realize the highest ROI for your investment. Coach your rookies so they can get into the game and contribute immediately. Be a mirror (or game film) for your experienced staff so they see the realities of their performance and make critical adjustments. And remember that you might just have some “Tigers” on your team — players who need to get their game back on — so help them shed the burdens of success, unlearn, and regain their once-natural brilliance.

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What’s Wrong with the FAA’s New Drone Rules

Nearly two years ago, I wrote that the phenomenal economic and social potential of commercial drones, more properly called unmanned aircraft systems (UAS), was being stymied by a slow-moving Federal Aviation Administration. Pending agency action, commercial uses for drones were effectively banned. (Hobbyist drone users are free to play, so long as they stay below 400 feet and away from airports.)

In 2012, Congress gave the FAA until 2015 to develop rules for military, commercial, and privately-owned drones to operate in U.S. airspace. In fact, the FAA had originally promised the rules by 2011, but it proceeded to miss every deadline it set for itself, as well as those established by Congress.

Well, 2015 has now arrived, and last month, investors, entrepreneurs, and other drone supporters gave two cheers when the agency at last released a draft of its proposed regulations.

In many industries, drones are poised to generate what Paul Nunes and I call Big Bang Disruptions, with the FAA itself estimating $100 billion in new business growth. Drones could revolutionize everything from natural resource protection, agriculture, emergency services, aerial photography, filmmaking, and delivery.

The draft rules would at last permit such commercial applications, with significant but not unmanageable restrictions. Drone operators will be regularly required, for example, to pass a written test, but won’t, as rumored, need to obtain a pilot’s license. The draft also leaves open the possibility of less restrictive rules for the smallest and lightest micro-drones, which pose little risk in the air or on the ground. “Technology is advancing at an unprecedented pace and this milestone allows federal regulations and the use of our national airspace to evolve to safely accommodate innovation,” Transportation Secretary Anthony Foxx said in a press release that accompanied the announcement.

When it comes to flying electronic devices weighing up to 55 pounds, safety is an essential requirement.  But are the delays justified?  The short answer is no.  The proposed rules are vague and incomplete, where they could easily be straightforward and even obvious.  Special rules for micro-drones should have come first, not just hinted at last. And an unnecessarily restrictive requirement that all drone operation require continual “line of sight” visibility and daylight-only operation means that some of the most high-potential applications, including local delivery services and nighttime agricultural monitoring, are still banned.

The FAA’s continued delays, in short, have little if anything to do with assuring the safety of U.S. airspace.  They have, instead, everything to do with bureaucracy and interest group politics.  In Washington, business as usual.

In stark contrast, the last four years have seen continued improvement in drone technology, much of which cannot be put to use. Like many of the Big Bang Disruptors we track, drones are piggybacking off the smartphone revolution, which has built efficient global markets for increasingly cheap off-the shelf cameras, processors, gyroscopes, accelerometers, and software that can be embedded in UAS. (Many use smartphones and tablets as their controllers.)

According to the Consumer Electronics Association, drone shipments will increase from 250,000 units in 2014 to nearly a million by 2018. And that’s for a technology that is, and will remain, largely illegal. Because even with the publication of the draft rules, the FAA’s ban is far from over.  Following time-honored administrative traditions, the FAA’s proposal will now go through a protracted comment period, public hearings, and further closed-door discussions with stakeholders.  Most observers estimate it will be another two years before final rules are even approved.

Indeed, the FAA wasn’t actually prepared to release the draft rules when it did, but in a snafu that highlights the underlying problem here, the agency’s hand was forced when industry watchers discovered a report analyzing the economics of the proposed rules inadvertently posted on the FAA’s website.

The cat out of the bag, the FAA hastily convened a Sunday press conference to announce the draft rules, further eroding any remaining confidence that the agency’s high-minded rhetoric about ensuring public safety is anything more than an excuse.

As the long-running drone rulemaking painfully highlights, the mismatch between rapidly-evolving disruptive innovations and the slow, deliberative model for expert agencies overseeing new industries has reached its breaking point–and then some.  The FAA’s processes, like those of most federal and state administrative agencies, haven’t really changed since the days of the railroad and telegraphs, which marked the beginning of our “modern” administrative state.

The FAA’s bumbling is hardly unique.  Across the technology sector, more and more start-ups are coming into conflict with an expanding range of regulators whose inner workings are intentionally secretive, and which seem designed to slow down precisely when they are pressured to speed up.

The Internet of Things, for example, is being stymied by the Federal Trade Commission’s valid but vague concerns about privacy protections, while crowdfunding and other innovative forms of finance await overdue rules from the Security and Exchange Commission. The Food and Drug Administration, meanwhile, has tortured home genetic testing services with years of delay and conflicting requirements. Taxicab, limousine, and hotel commissions under the thumb of incumbent providers are holding back a tidal wave of “sharing economy” services, which have introduced technological innovations the incumbents have little incentive to build. And state and federal departments of transportation have barely started to think about the pros and cons of self-driving vehicles, which are poised to revolutionize automotive and related industries.

The causes vary for this epidemic of counter-productive interference, which is threatening a long and successful policy, at least in the U.S., of what George Mason University’s Adam Thierer calls “permissionless innovation.” One problem is that regulatory agencies are institutionally, and perhaps even legally, unable to innovate their processes. Many agencies have so far been untouched by the digital revolution and have little, if any, expertise to apply.

Self-interest also plays a big part in the stonewalling, as bureaucrats feel threatened by technologies that allow consumers to rate and otherwise discipline companies, suggesting better and cheaper alternatives to corruptible human regulators. All too often, as well, regulated incumbents and other stakeholders are encouraging the delays and obstacles rather than retooling themselves to compete with technology-driven disruptors.

Entrepreneurs can’t wait for governments to catch up to the 21st century. Indeed, some countries are making inroads, not by inventing better technology, but by innovating their regulatory systems. Both the U.K. and Canada, for example, have already established rules for some commercial drone activities, giving their start-ups the opportunity to develop new applications and businesses while U.S. entrepreneurs twiddle their thumbs.

In an increasingly global market both for consumers and entrepreneurial talent, even a slightly more efficient approach to regulating can make all the difference. As our research shows, better and cheaper innovations often generate “winner take all” markets. So countries that unshackle their innovators first may capture the momentum that drives future innovation and investment.

Today, the FAA’s continued haplessness may doom the enormous potential of an inchoate U.S. commercial drone industry. But tomorrow, without Big Bang reform for our administrative state, the same fate may befall entrepreneurs working in 3D printing, health and fitness tracking devices, smart energy and transportation, and pretty much every other industry where Big Bang Disruption is imminent.

Which is pretty much all of them.

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Case Study: Should an Emerging-Market Incubator Help U.S. Businesses?

To Helena Valencia, Miami was home. She had grown up there. It was the place that had shaped her understanding of people and launched her into the wider world. In fact, her love of the city’s mingled cultures and vibrant local businesses was one of the things that had inspired her to cofound Unamano, now a world-renowned nonprofit that supported entrepreneurship in emerging markets.

Editor’s Note











This fictionalized case study will appear in a forthcoming issue of Harvard Business Review, along with commentary from experts and readers. If you’d like your comment to be considered for publication, please be sure to include your full name, company or university affiliation, and e-mail address.

Thinking of her own cousin Guillermo Pombo, an engineer who had recently graduated from the University of Miami and was struggling to start his own business, Helena could see where Conrad was coming from. And yet her instinct was to oppose the idea. Unamano’s mission was to help entrepreneurs in emerging markets—not in the United States. An American city, no matter how disadvantaged, could fend for itself, right?

Conrad’s proposal had divided the board down the middle, with half the members favoring it and the other half crying foul. Out of respect for her friend, Helena had held her tongue at the meeting. But she’d been thinking about it ever since. Was he way off base on this one? Or could Unamano’s geographic scope be expanded?

 

A Bold Idea

Unamano had been a pretty big idea for a shy, studious girl whose Colombian family still lived within sight of Miami International Airport. After graduating first in her high school class, Helena had gone north to college, where she studied, among other things, new-business funding in Latin America. She was disturbed by what she learned: It was easy enough for an aspiring entrepreneur to get a $100 microloan, but borrowing sizable amounts was impossible—as was obtaining any kind of venture capital—unless you were rich and from a prominent family.

Helena had dreamed of starting a nonprofit that would seek out, mentor, and support high-potential entrepreneurs in Latin America. But it wasn’t until her first year of law school that she’d found someone to help her: her classmate Conrad. They’d bonded over their Miami roots and their desire to make a difference in the world, and soon they began developing Helena’s idea into a fully fledged organization. Unamano’s purpose wouldn’t be to raise cash and spread it around. Instead, it would serve as a connector, recruiting local business leaders to commit to helping entrepreneurs.

Because the defining vision had been Helena’s, she became the CEO. Conrad was juggling too many other pursuits to take an executive position at the time, but he agreed to help her and serve on the board, and his ideas, energy, and fearlessness contributed to the organization’s success in attracting dedicated people and money. He’d been the one to suggest that Unamano aim to quadruple the revenues of the small businesses it targeted, an audacious goal given the long odds facing any emerging-market start-up.

Helena realized that to meet that goal, Unamano had to carefully select the most promising entrepreneurs to assist, putting candidates through a gantlet of pitch sessions, reference checks, and interviews. Once anointed as Unamano Entrepreneurs, or UEs, they would receive abundant free advice from experienced local advisers, be introduced to local and global mentors and service providers, and attend conferences and meet-ups. Successful UEs would be expected to become the next generation of local angel investors and venture capitalists. Put simply, Unamano aimed to build entrepreneurial ecosystems where none had existed before.

Within a decade the organization stretched well beyond Latin America to the Middle East and Asia. It had 12 country offices in places as distant as Jakarta and Dubai and, while about 30 people worked in the New York headquarters, another 250 staff members were scattered around the world. Businesses run by UEs generated $6 billion in annual revenue and employed 225,000 people. Helena had been profiled in Forbes, the Wall Street Journal, and The Economist as a champion of entrepreneurship. Although she was based in Manhattan, she traveled constantly and was a frequent keynote speaker.

Still, she hadn’t forgotten her roots. She spent most holidays back in Miami. And it was over Easter, a week after Conrad’s board presentation, that she finally had time to catch up with Guillermo.

Helena still remembered him as a friendly, energetic adolescent; she and her sisters had called him el cachorro, the puppy. But he was now a postdoc working on a desalination project that he believed could solve South Florida’s water problems. He’d found a receptive chemical-company owner who was providing lab space and even some financial support. But it was clear that Guillermo was much more of an engineer than a businessman, and despite his outgoing nature, he hadn’t been able to find new mentors or investors. Helena could see that his aspirations were being choked by lack of access to experienced businesspeople.

“Is there anything Unamano can do for me?” he asked plaintively as he was leaving the holiday dinner at her parents’ place.

Helena told him she was sorry, but it was out of the question. For now, at least, Unamano was focused on emerging markets, like Latin America. It didn’t have U.S. operations.

“But that makes no sense,” he protested. “The capital of Latin America is Miami!”

Guillermo had a point. Miami-Dade County, 66% Hispanic, was home to more than a million Latin Americans, some displaced by dysfunctional regimes at home, others seeking opportunity. It should have been a prime area for entrepreneurial activity: It had a solid technology infrastructure and a substantial population of 25-to-44-year-olds—many of whom were engineering or computer-science graduates—as well as a large local consumer market.

But Guillermo’s struggles weren’t unique. The local economy hadn’t diversified beyond its base in tourism and real estate into fast-growing areas such as health care or bioscience, and entrepreneurial success stories were few and far between. R&D investment had been growing, but slowly, and the region didn’t generate much early-funding activity. In the past year only 16 firms in greater Miami had received venture capital.

People with entrepreneurial ambitions learned early on that to seek their fortunes, they needed to move to New York, Boston, or the West Coast. Amazon’s Jeff Bezos, the valedictorian of his class at Miami Palmetto Senior High School, had been part of that exodus. As a result, Miami was a prime example of widening economic inequality. While millionaires abounded, most people in the region were losing ground economically.

Helena and Conrad’s families represented those two poles. Helena’s father had run a coffee-and-sandwiches cart in downtown Miami. Conrad’s was a real estate investor in Coconut Grove. Conrad still lived in that neighborhood and now ran multiple companies, including an oil-exploration firm and a VC partnership.

From that perch, he saw only potential in Miami. If Unamano was to meet the strategic goal it had set out last year—to open affiliates in 25 countries by 2020—why wouldn’t it consider the city?

An Acute Need

On her flight back to New York, Helena ran through Unamano’s guidelines for regions in which it would expand. They had to have very limited access to key resources for scaling up young companies, such as capital, talent, and mentors. But they also needed to show promise, with a healthy per capita GDP. There had to be respect for property rights and the rule of law; a cohesive culture; a robust middle class; solid educational institutions; a sizable population of university-educated citizens; a core group of influential local business leaders who had demonstrated a commitment to boosting local entrepreneurship; a modest level of VC activity; and “pull” from the region in the form of a desire for Unamano’s presence and a commitment of operational funding. A region also had to have some local business leaders willing to contribute funds or their time for a three-year period.

Miami certainly qualified. A local media mogul had already offered $3 million to get an Unamano affiliate going.

But how could Unamano justify opening an affliliate in such a comparatively wealthy city? Miami’s median income was 10 times that of most of the cities where Unamano operated. And whatever problems entrepreneurs faced in Miami, the truth was that America led the world in support for start-ups.

Besides, Helena kept going back to her mission statement: “transforming emerging countries by supporting high-impact entrepreneurship.” That was the vision that had attracted Lawrence Melchior, a veteran social entrepreneur, onto Unamano’s board as chairman. Lawrence had told Conrad at the recent board meeting: “‘Twenty-five by 2020’ means 25 emerging countries. I joined Unamano to take it from being ‘charming’ to being globally important. And that means being in as much of the developing world as possible.”

Although they’d all agreed to table the discussion that day, Helena knew the fight would continue at the next meeting.

From the taxi line at La Guardia, she called Conrad. “Some board members think this will derail the entire organization,” she said. “They think you’re just favoring your hometown.”

“Our hometown,” Conrad said in a teasing tone.

“I just don’t think it can fly,” she said. “I don’t think it should fly. How can we hit 25 developing countries by 2020 if we get distracted by operations in the U.S.? What will this mean for the Unamano brand?”

“We’re focusing too much on countries,” he said. “One thing we’ve all learned over the years is that it’s not about countries, it’s about cities. City demographics. City economics. City-based entrepreneurial ecosystems. Look at Lebanon: If we had focused on the demographics and economy of the country as a whole, we never would have opened an affiliate there. It’s Beirut that matters. We shouldn’t be misled by national borders.”

“OK, but Miami is in the U.S. How can any U.S. city be in the same sort of position as Beirut?”

“Yes, but it was Greece and southern Italy, which were getting killed by high unemployment, currency problems, and falling demand. The need there was acute.”

“It’s acute in Miami too,” Conrad said.

“Sure, and in Newark, and Bridgeport, and New Haven. If we open in Miami, where do we stop? Our whole mission will be watered down.”

“I don’t want to open an affiliate in Newark or anywhere else in the States,” he said. “Only in Miami.”

“But what about the affiliates?” she asked, with exasperation. “The managing directors in Lebanon and Saudi Arabia and Brazil and Argentina and the others. They’d never agree to diverting our resources to the U.S.”

“Haven’t I told you?” Conrad asked. “I surveyed them. On balance, they think it’s a good idea, especially the managing directors in Latin America. They see Miami as a potential target market for their local companies. By developing entrepreneurship there, we’d be developing their customers.”

Question:











Please remember to include your full name, company or university affiliation, and e-mail address.

“You know the board doesn’t feel the same way. Half of them are totally against this idea.”

“I know one person who could change their minds,” Conrad said, again in that teasing tone. “C’mon, Helena, trust me on this one.”

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Data Monopolists Like Google Are Threatening the Economy

The White House recently released a report about the danger of big data in our lives. Its main focus was the same old topic of how it can hurt customer privacy. The Federal Trade Commission and National Telecommunications and Information Administration have also expressed concerns about consumer privacy, as have PwC and the Wall Street Journal.

However, big data holds many other risks. Chief among these, in my mind, is the threat to free market competition.

Today, we see companies building their IP not solely on technology, but rather on proprietary data and its derivatives. As ever-increasing amounts of data are collected by businesses, new opportunities arise to build new markets and products based on this data. This is all to the good. But what happens next? Data becomes the barrier-to-entry to the market and thus prevents new competitors from entering. As a result of the established player’s access to vast amounts of proprietary data, overall industry competitiveness suffers. This hurts the economy.

Federal government regulators must ask themselves: Should data that only one company owns, to the extent that it prevents others from entering the market, be considered a form of monopoly?

The search market is a perfect example of data as an unfair barrier-to-entry. Google revolutionized the search market in 1996 when it introduced a search-engine algorithm based on the concept of website importance — the famous PageRank algorithm. But search algorithms have significantly evolved since then, and today, most of the modern search engines are based on machine learning algorithms combining thousands of factors — only one of which is the PageRank of a website. Today, the most prominent factors are historical search query logs and their corresponding search result clicks. Studies show that the historical search improves search results up to 31%. In effect, today’s search engines cannot reach high-quality results without this historical user behavior.

This creates a reality in which new players, even those with better algorithms, cannot enter the market and compete with the established players, with their deep records of previous user behavior. The new entrants are almost certainly doomed to fail. This is the exact challenge Microsoft faced when it decided to enter the search market years after Google – how could it build a search technology with no past user behavior? The solution came one year later when they formed an alliance with Yahoo search, gaining access to their years of user search behavior data. But Bing still lags far behind Google.

This dynamic isn’t limited only to internet search. Given the importance of data to every industry, data-based barriers to entry can affect anything from agriculture, where equipment data is mined to help farms improve yields, to academia, where school performance and census data is mined to improve education. Even in medicine, hospitals specializing in certain diseases become the sole owners of the medical data that could be mined for a potential cure.

While data monopolies hurt both small start-ups and large, established companies, it’s the biggest corporate players who have the biggest data advantage. McKinsey calculates that in 15 out of 17 sectors in the U.S. economy, companies with more than 1,000 employees store, on average, over 235 terabytes of data—more data than is contained in the entire US Library of Congress.

Data is a strategy – and we need to start thinking about it as one. It should adhere to the same competitive standards as other business strategies. Data monopolists’ ability to block competitors from entering the market is not markedly different from that of the oil monopolist Standard Oil or the railroad monopolist Northern Securities Company.

Perhaps the time has come for a Sherman Antitrust Act – but for data. Unsure where you come down on this issue? Consider this:  studies have shown that around 70% of organizations still aren’t doing much with big data. If that’s your company, you’ve probably already lost to the data monopolists.

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