Marina Gorbis's Blog, page 1346

How to Invent the Future

We need more than big ideas, or pithy words, or an ultra-clear vision to invent the future.

Odd as it may seem for discussing innovation and management, I’m reminded of a sociology experiment done in the 1960s. Five monkeys were placed in a cage, with a batch of bananas hung from the ceiling and a ladder placed right underneath it. It took only a few seconds for one of the monkeys to race up the ladder to grab the bananas.

But the next day, whenever any of the monkeys started up the ladder, the researchers sprayed all of the monkeys with ice-cold water. Soon, each of the monkeys learned to not go up the ladder, and if any of them started to, the others would hold them back by pulling on their tail. This was done repeatedly until each little monkey had learned the lesson: no one climbs the ladder. No banana is worth it.

Once all five monkeys were conditioned to avoid the ladder, the researchers substituted in a new monkey. And wouldn’t you know it – the New Guy monkey spots the beautiful yellow bananas and goes up the ladder. But the other four monkeys – knowing the drill – jump on New Guy, and beat him up.

One by one, the researchers replaced each monkey, until none of the monkeys in the cage had been sprayed by icy water. And yet none of these new monkeys would go up the ladder, either. The rules had been set, because, “That’s just the way we do things around here.”

You know where I’m going with this story, right?  Most of us are a lot like those monkeys. On the upside (and there is an upside) we learn from one another, we don’t let down our mates, and we get along. But on the downside, we don’t bother to examine the rules as they’ve been handed down.

And this downside – not examining the rules as they’ve been laid down – is not a minor thing; it has a huge cost. It stalls progress. It defeats those with fresh new ideas. It reinforces entrenched interests.

When a society accepts the practices, methods, and measures of the 20th century to conceive the 21st century, failure is inevitable. In order to consider new ideas, you have to be willing to let go of ones that no longer serve you.

The challenge, though, is not how to throw away the Old to embrace the New. That would be folly; the efficiency of the 20th century is what allows (most of) us have clean water and plenty of relatively inexpensive food to eat and so on. Plus, let’s not forget that “new” ideologies can be misleading. I’m reminded of Enron’s “new metrics” once touted by big-name thinkers as reflecting the future of management. Only later did we all collectively learn it reflected criminal accounting practices. So “new” is not the end-all. Unlike the medicine in your bathroom drawer, ideas don’t come with pre-printed expiration dates. There are no clear signs for which ones to toss and when. The challenge is in knowing how to evaluate and build new ideas into reality.

And when management thinkers are confined together in our own enclosures – not cages, but conferences – we seem to do little more than pull on each other’s tails. We find flaws in each other’s arguments (and surely there are many, for they are nascent ideas). We largely advocate for our own idea and ours alone, because we want so desperately for it to be seen. And we show why any New Idea doesn’t prove out, often without sharing our fundamental assumptions. And like the monkeys, we find ways of signaling: “That’s not the way we do things around here.”

And this approach is definitely not the way to invent the future.

So I’ve been thinking about what we’re all facing: How to deal with Change. That’s change with a capital C. Your career, your company (if you have one), and your industry are all coping with change. And with it, comes an opportunity to question what new approaches to adopt, and what to do with existing frameworks and ideas. In this social era, when connected humans can now do what once only large organizations could, the fundamentals are shifted enough, a lot of what once worked, doesn’t.

So, I think we all need a better “how” for creating ideas. It’s not enough to have the best idea, or the phrase that makes an idea go viral. Instead, what we need is a way for ideas to become powerful enough to dent the world. And no one can do that acting alone.

To figure out a way forward, let’s explore how Eric Liu, founder of Citizen University, which runs programs designed to help build the skills of effective citizenship, works on his initiative.

First, any group that joins the program has to have a shared purpose that goes beyond their own private interests. Not common strategies, but a common shared purpose, with many possibly different, most likely opposing strategies to achieve that purpose. This is why Citizen University draws leaders from both MoveOn.org and the Tea Party. They choose to come together, because they’re both leaders and activists interested in revitalizing democracy with a bottom-up, inclusive approach.

Second, the individual participants agree to build on each other’s ideas. Not as a cheerleader or a critic, but what we might call being “loyal oppositionist”: someone able to say “Here’s what’s wrong, why I think so, and one possible way to make the idea better.” As Eric says, “We ask people to not just reflexively respond, but to help one another.” Explaining why you have doubts about an idea lets everyone understand if they have different working assumptions. And proposing a solution helps advances the idea. Eric has been convening the group for three years now, and he says that one sign of success is that people keep making the effort to come back and help one another in these private forums, because people learn best and take in new ideas when they’re not “on the spot.”

Third, and underlying both points above, the conveners are inclusive of who can participate in the conversation. To hear an up and coming idea, you’ve gotta hear from many types of people, from different histories and with different experiences, so you can be challenged by newness.

It’s hard to know if Eric and the Citizen University idea will accomplish what they set out to do – to revitalize citizenship in the United States. It’ll take years for that story to play itself out. But their approach matches what I’ve seen work for innovation teams across companies. It is the “new how”, a collaborative way that shapes ideas to be better, to be stronger, and ultimately become real. To invent the future, we don’t need more ideas, or better words, or directional visions to invent the future. Instead, we need challenge common beliefs and ingrained interests. We need to stop pulling each other down by the tail and instead build up our ideas together.

 

This post is part of a series leading up to the annual Global Drucker Forum, taking place November 13-14 2014 in Vienna, Austria. Read the rest of the series here.

Why Does Food Taste Better if Someone Else Is Having the Same Thing?

People who ate chocolate in the presence of another person thought it tasted better if the other person had eaten the same thing, rating it 6.83 on an 11-point flavor scale versus 5.57 if the other person had been merely reading a booklet. This is even though there was no conversation about the experience, says a team at Yale led by Erica J. Boothby. Imagining another person’s feelings during a shared event may increase the cognitive resources you devote to it, thus intensifying your experience, the researchers say.

What You Eat Affects Your Productivity

Think back to your most productive workday in the past week. Now ask yourself: On that afternoon, what did you have for lunch?

When we think about the factors that contribute to workplace performance, we rarely give much consideration to food. For those of us battling to stay on top of emails, meetings, and deadlines, food is simply fuel.

But as it turns out, this analogy is misleading. The foods we eat affect us more than we realize. With fuel, you can reliably expect the same performance from your car no matter what brand of unleaded you put in your tank. Food is different. Imagine a world where filling up at Mobil meant avoiding all traffic and using BP meant driving no faster than 20 miles an hour. Would you then be so cavalier about where you purchased your gas?

Food has a direct impact on our cognitive performance, which is why a poor decision at lunch can derail an entire afternoon.

Here’s a brief rundown of why this happens. Just about everything we eat is converted by our body into glucose, which provides the energy our brains need to stay alert. When we’re running low on glucose, we have a tough time staying focused and our attention drifts. This explains why it’s hard to concentrate on an empty stomach.

So far, so obvious. Now here’s the part we rarely consider: Not all foods are processed by our bodies at the same rate. Some foods, like pasta, bread, cereal and soda, release their glucose quickly, leading to a burst of energy followed by a slump. Others, like high fat meals (think cheeseburgers and BLTs) provide more sustained energy, but require our digestive system to work harder, reducing oxygen levels in the brain and making us groggy.

Most of us know much of this intuitively, yet we don’t always make smart decisions about our diet. In part, it’s because we’re at our lowest point in both energy and self-control when deciding what to eat. French fries and mozzarella sticks are a lot more appetizing when you’re mentally drained.

Unhealthy lunch options also tend to be cheaper and faster than healthy alternatives, making them all the more alluring in the middle of a busy workday. They feel efficient. Which is where our lunchtime decisions lead us astray. We save 10 minutes now and pay for it with weaker performance the rest of the day.

So what are we to do? One thing we most certainly shouldn’t do is assume that better information will motivate us to change. Most of us are well aware that scarfing down a processed mixture of chicken bones and leftover carcasses is not a good life decision. But that doesn’t make chicken nuggets any less delicious.

No, it’s not awareness we need—it’s an action plan that makes healthy eating easier to accomplish. Here are some research-based strategies worth trying.

The first is to make your eating decisions before you get hungry. If you’re going out to lunch, choose where you’re eating in the morning, not at 12:30 PM. If you’re ordering in, decide what you’re having after a mid-morning snack. Studies show we’re a lot better at resisting salt, calories, and fat in the future than we are in the present.

Another tip: Instead of letting your glucose bottom out around lunch time, you’ll perform better by grazing throughout the day. Spikes and drops in blood sugar are both bad for productivity and bad for the brain. Smaller, more frequent meals maintain your glucose at a more consistent level than relying on a midday feast.

Finally, make healthy snacking easier to achieve than unhealthy snacking. Place a container of almonds and a selection of protein bars by your computer, near your line of vision. Use an automated subscription service, like Amazon, to restock supplies. Bring a bag of fruit to the office on Mondays so that you have them available throughout the week.

Is carrying produce to the office ambitious? For many of us, the honest answer is yes. Yet there’s reason to believe the weekly effort is justified.

Research indicates that eating fruits and vegetables throughout the day isn’t simply good for the body—it’s also beneficial for the mind. A fascinating paper in this July’s British Journal of Health Psychology highlights the extent to which food affects our day-to-day experience.

Within the study, participants reported their food consumption, mood, and behaviors over a period of 13 days. Afterwards, researchers examined the way people’s food choices influenced their daily experiences. Here was their conclusion: The more fruits and vegetables people consumed (up to 7 portions), the happier, more engaged, and more creative they tended to be.

Why? The authors offer several theories. Among them is an insight we routinely overlook when deciding what to eat for lunch: Fruits and vegetables contain vital nutrients that foster the production of dopamine, a neurotransmitter that plays a key role in the experience of curiosity, motivation, and engagement. They also provide antioxidants that minimize bodily inflammation, improve memory, and enhance mood.

Which underscores an important point: If you’re serious about achieving top workplace performance, making intelligent decisions about food is essential.

The good news is that contrary to what many of us assume, the trick to eating right is not learning to resist temptation. It’s making healthy eating the easiest possible option.

 

More on food, health, and productivity:

Should You Eat While You Negotiate?

Sleep Is More Important than Food

Sitting Is the Smoking of Our Generation

Disrupting TV’s Status Quo

Famed producer Norman Lear on developing groundbreaking sitcoms, managing creative partnerships and the lessons he wants to pass on to the next generation.

Download this podcast

​Numbers Show Apple Shareholders Have Already Gotten Plenty

Carl Icahn is at it again. On Oct. 9, armed with about 1% of Apple’s outstanding stock, the hedge-fund activist published an open letter to Apple CEO Tim Cook, urging him to accelerate the company’s stock repurchases by making a tender offer. I hope Cook doesn’t listen, because I think it would be bad for Apple, all of its employees who have contributed to its success, and the American economy. But judging from Cook’s past actions, I fear he will do Icahn’s bidding.

In August 2013, Icahn bought more than $1 billion worth of Apple shares. As he tweeted, he then had a “cordial dinner with Tim” the following October, during which he “pushed hard for a $150 billion buyback.”

Icahn later reduced his buyback request to $50 billion, and in April 2014 Apple’s board approved a $30 billion program to be carried out by repurchasing its shares on the open market — either by just buying shares outright or doing it indirectly via accelerated share repurchases. That was on top of a $60 billion buyback program authorized a year earlier, along with up to $40 billion in dividends. Apple’s stated intention was to carry out this $130 billion distribution of corporate cash to Apple shareholders between August 2012 and December 2015.

Since August 2012, Apple has been on a buyback binge, expending a total of $53 billion on stock repurchases through the third quarter of 2014, the last figures it has disclosed. But with his open letter to Cook, Icahn has let the public know once again that however much Apple buys back, he feels it has the current cash, borrowing capacity, and long-term profit prospects to do much, much more.

Apple is a company with phenomenal products and profits. But by jumping on the buyback bandwagon — something Steve Jobs refused to do — Apple’s current top management has shown the same lack of strategic vision that has undermined many once-great American companies, including Cisco, HP, IBM, Microsoft, and Motorola. As I explain in my recent Harvard Business Review article, “Profits Without Prosperity,” open-market repurchases that represent the vast majority of buybacks in the United States reward value extraction and undermine value creation.

Here’s an update of some key numbers in that article: In 2004-2013, 454 companies in the S&P 500 Index that were publicly listed over the decade expended $3.4 trillion on buybacks (51% of net income) and another $2.3 trillion on dividends (35% of net income). As is clear by the increasing amounts that U.S. companies, including cash-rich Apple, are borrowing to do buybacks, a large chunk of profits that is not spent on repurchases is being held abroad to avoid U.S. corporate taxation. All of this adds up to profits without prosperity in the United States.

Buybacks done through tender offers may be good for a company and the economy — when their purpose is to ensure that control over the firm’s resources remains with owner-managers who have the ability to identify growth opportunities and are committed to pursuing them. Henry Singleton, who presided over Teledyne in the 1970s, and Warren Buffet, Berkshire Hathaway’s legendary leader, are exemplars. Carl Icahn is not.

Unlike Singleton and Buffet, Icahn makes it abundantly clear that he is only interested in Apple making a tender offer for it shares in order to double their already-high price. (Since the beginning of September, Apple’s share price — adjusted for the 7-to-1 stock split that Apple did last June — has been the highest in the company’s history.) After Apple does its pump, Icahn Enterprises will do its dump.

Of Apple’s $53 billion in buybacks, $25 billion have been direct open-market repurchases (DOMRs), $26 billion accelerated share repurchases (ASRs), and $2 billion retired shares deducted from employee stock-based compensation to pay withholding taxes. Here’s how the first two work:

DOMRs: Apple repurchases stock on the open market on strategically chosen dates under SEC Rule 10b-18, presumably in amounts up to its daily “safe harbor” limit, currently $1.5 billion. It doesn’t have to disclose the dates on which it makes or has made the repurchases; it only has to report the total amount made each quarter

ASRs: Apple contracts with an investment bank to short its stock, enabling the company to retire in one fell swoop the entire amount in the contract. The bank then does the actual repurchases on the open market over time (in the case of Apple, nine months for the first $2 billion ASR and 12 months for each of two later $12 billion ASRs).

Whether done as a DOMR or ASR, the purpose of such buybacks is to give manipulative boosts to a company’s earnings per share (EPS) to help drive up its stock price. Executives can use them to increase their gains from stock-based pay.

The problem for Icahn as an outsider is that he cannot know when Apple is actually doing a DOMR or ASR. (If he were somehow privy to this inside information, it would be illegal for him to trade on it). The same applies to pension funds and mutual funds, the latter of which Icahn believes are under-invested in Apple.

He hopes that a highly visible $100 billion Apple tender offer at a price premium would convince fund managers to load up on Apple stock, helping to fuel a buying binge that would rapidly raise its price to over $200, adding in excess of $5 billion to his wealth.

What do Icahn’s machinations mean for Apple as a company that directly employs 85,000 people worldwide and for the United States as a nation that has invested in the physical infrastructure and human knowledge that have enabled Apple and other high tech companies to emerge, grow, and prosper? Massive buybacks rewards parties who have contributed the least to Apple’s products and profits. Icahn has contributed absolutely nothing to Apple’s success; nor have its public shareholders in general.

The only time in its history when Apple raised funds on the stock market was its 1980 IPO, which provided it with $97 million. In just the past two years, through buybacks, Apple has “returned” $51 billion to financial interests — the vast majority of whom never invested a penny in the productive assets of the company.

What, then, should the world’s richest company do with all those profits? I asked precisely that question in a paper, “Apple’s Changing Business Model,” that I published in September 2013, before Icahn had begun to dictate Apple’s financial policy. (Another hedge-fund activist, David Einhorn, was then playing that role). My coauthors and I argue that Apple should be returning profits to workers who have invested their time and effort into generating its products and to taxpayers who have funded the investments in the physical infrastructure and human knowledge so critical to Apple’s success.

Corporate Universities Should Reflect a Company’s Ideals

If the number of executives from other companies who have been benchmarking GE’s management-development centers is an indication, interest in creating corporate universities is on the rise. While these visitors are always intrigued by the commitment and sense of mission they observe, many tend to focus on traditional metrics like the number of classes, the number of participants per year, and the cost. But they sometimes fail to understand that a corporate university can and should be used to drive strategic and cultural change and to champion individual and collective growth. Here are some of GE’s principles for achieving those essential aims:

A leadership institute should reflect the company’s leadership ideals. Establishing a corporate university is a big deal. It is a statement you are making to employees about the company’s willingness to invest in talent. It is an expression of a company’s ideal for leadership excellence. So being clear about what the corporate university stands for is an essential starting point. At GE, we use our corporate university to “inspire, connect, and develop.” Employees of all levels, from all our businesses and regions, come together here. We have made our flagship site in Crotonville, New York, the epicenter of our culture — a go-to place to get a feel for what we are all about.

Deep leadership involvement is essential. Superficial measures like number of classes or participants or even costs are not a real indication of value. Deeper qualities, some of which can’t be measured, are critical to success.

One of the most important is how senior leaders engage participants in the learning process. Jeff Immelt, GE’s chairman and CEO, spends more than one-third of his time on leadership development — setting the tone for leaders at Crotonville and worldwide. For instance, we have a course for mid-level executives, called the Manager Development Course (MDC). We have offered well over 100 MDC sessions since Jeff took the helm in 2001, and he has participated in all but one.

Crotonville also provides a platform for driving cultural and leadership change across the company. Some of GE’s best-known initiatives — WorkOut; CAP; Six Sigma, Lean Six Sigma; Leadership, Innovation, and Growth; and, more recently, Simplification — took shape at Crotonville. This is where the leadership of the company tests new concepts, gets the voice of the employee, launches new interventions and initiatives.

The experience matters as much as the content. While great content is vital, providing the right kind of environment and learning experience is just as important. We curate a participant’s experience with the aim of making it an immersive learning journey — intellectually, emotionally, and even physically. When a person enters the campus, every second of his or her stay is focused on learning. We try and make it transformative. Everyone — from the facilities team to the hospitality staff to the faculty — endeavors to create an atmosphere of excitement, learning, and connection.

It is about meritocracy, not hierarchy. We want attendees to be open to learn from everything and everybody. Each individual who comes in is a student, a teacher, and a coach, in keeping with our leadership philosophy of “we all rise.” All the events are open to everyone. Even the residence building reflects an egalitarian view: The accommodations are the same irrespective of seniority. All learners are equal. The prime objective is to learn.

The physical space of a corporate university is always the easy part. Infusing all its applications with the company’s culture, or spirit, is what’s difficult. A corporate university can play an instrumental role in creating a company’s future.

What Peter Drucker Knew About 2020

When PwC released its annual survey of corporate chief executives for 2014, it was immediately obvious that change is on leaders’ brains: “As CEOs plan their strategies to take advantage of transformational shifts,” the consultancy reported, “they are also assessing their current capabilities – and finding that everything is fair game for reinvention.”

It’s no wonder why.

“Every few hundred years throughout Western history, a sharp transformation has occurred,” Peter Drucker observed in a 1992 essay for Harvard Business Review. “In a matter of decades, society altogether rearranges itself – its worldview, its basic values, its social and political structures, its arts, its key institutions. Fifty years later a new world exists. And the people born into that world cannot even imagine the world in which their grandparents lived and into which their own parents were born. Our age is such a period of transformation.”

For Drucker, the newest new world was marked, above all, by one dominant factor: “the shift to a knowledge society.”

Indeed, Drucker had been anticipating this monumental leap – to an age when people would generate value with their minds more than with their muscle – since at least 1959, when in Landmarks of Tomorrow he first described the rise of “knowledge work.” Three decades later, Drucker had become convinced that knowledge was a more crucial economic resource than land, labor, or financial assets, leading to what he called a “post-capitalist society.” And shortly thereafter (and not long before he died in 2005), Drucker declared that increasing the productivity of knowledge workers was “the most important contribution management needs to make in the 21st century.”

Sadly, judging from the way most of our institutions are run, we are still struggling to catch up with the reality Drucker foresaw. How should managers alter their approaches to fit the times? Here are six aspects of running an enterprise that should now be front-and-center:

Figure out what information is needed. “It is information,” Drucker wrote, “that enables knowledge workers to do their job.” This is especially true for executives. The trouble is, even in a hyper-connected world where endless amounts of data are literally at our fingertips, many rely on the producers of the data – the bean counters, the sales force, the IT department – to serve up the numbers they believe are most relevant. And these folks don’t necessarily have a clue. A 2014 McKinsey & Co. survey found, for example, that fewer than 20% of IT professionals say they are effective at targeting where they can add the most value inside their organizations. “An adequate information system,” Drucker wrote, must lead executives “to ask the right questions, not just feed them the information they expect. That presupposes first that executives know what information they need.”

Actively prune what is past its prime. Virtually every executive is eager to see his or her organization innovate. Through our work at the Drucker Institute, however, it is clear that most are reluctant to take the necessary first step toward creating the new: continually winding down those products, services, programs, and procedures that are no longer making a real contribution. “Every organization will have to learn to innovate” on a constant basis, Drucker wrote. “And then, of course, one comes back to abandonment, and the process starts all over. Unless this is done, the knowledge-based organization will very soon find itself obsolescent, losing performance capacity and with it the ability to attract and hold the skilled and knowledgeable people on whom its performance depends.”

Embrace employee autonomy. Drucker urged executives to push decision-making and accountability all the way down through the organization as early as 1954, when he introduced the concept of Management by Objectives. And yet there is ample evidence that most organizations remain paragons of command-and-control. In a knowledge economy, top-down direction is particularly detrimental because employees are bound to know more than their supervisors do about the specialized fields in which they operate. They may also know more about the customer—his needs and desires. “Knowledge workers have to manage themselves,” Drucker advised. “They have to have autonomy.”

Build true learning organizations. “If knowledge isn’t challenged to grow, it disappears fast,” Drucker cautioned. “It’s infinitely more perishable than any other resource we have ever had.” To keep it fresh, John Hagel, co-chairman of Deloitte’s Center for the Edge, says that firms need “new architectures” designed to increase the flow of information and learning inside and outside the organization’s walls. Traditionally, the organizing principle for businesses was to achieve efficiencies of scale. Now, Hagel says, “scalable learning” must be the aim. Pursuing it begins with redesigning work environments to foster new knowledge creation – that is, to move beyond sharing what’s already known to helping workers make genuine discoveries more quickly by tackling performance challenges together. Unfortunately, there’s an awfully long way to go. Asked how many corporations have implemented this vision, Hagel says: “The answer is zero.”

Provide a much stronger sense of purpose. Survey after survey reveals that the vast majority of employees are not engaged in what they do. One big reason is the failure to connect people’s jobs with a larger sense of purpose. Too often, the organization seems to be an end in itself; no meaningful link has been forged between the daily tasks of the enterprise and how they serve the customer and better society. “What motivates – and especially what motivates knowledge workers – is what motivates volunteers,” Drucker wrote. Among other things, “they need to know the organization’s mission and to believe in it.” A paycheck, even a fat one, is not enough. No longer can organizations expect to inspire “by satisfying knowledge workers’ greed,” Drucker counseled. “It will have to be done by satisfying their values.”

Be more mindful of those left behind. Drucker worried a lot about a group that he characterized as “knowledge-worker cousins”: service workers. “Knowledge workers and service workers are not ‘classes’ in the traditional sense,” Drucker wrote. “But there is a danger that … society will become a class society unless service workers attain both income and dignity.” He added: “Anyone can acquire the ‘means of production’, i.e., the knowledge required for the job, but not everyone can win.” Again, Drucker’s words prove prescient as the gains in the knowledge economy are hardly being shared equitably. “Our basic grievance with today’s billionaires is that relatively little of the value they’ve created trickles down to the rest of us,” the University of Toronto’s Roger Martin asserts. He warns that this situation is unsustainable, and that top executives need to rein in their compensation. Surely, Drucker would have agreed. “A healthy business,” he wrote, “cannot exist in a sick society.”

It’s easy to forget how profound the emergence of the knowledge age really is. Ours is “the first society in which ‘honest work’ does not mean a callused hand,” Drucker noted. “This is far more than a social change. It is a change in the human condition.” But for all that, what it takes to manage effectively now is no mystery. We’ve been headed down this path for more than half a century.

In his HBR piece, Drucker suggested that our great transformation would be completed by 2010 or 2020. It is high time that management started acting like the clock is running out.

 

This post is part of a series leading up to the annual Global Drucker Forum, taking place November 13-14 2014 in Vienna, Austria. Read the rest of the series here.

Make the Internet of Things More Human-Friendly

In early research, McKinsey emphasized that the distinctive character of the Internet of Things — which is predicted to be a $7.1 trillion market by 2020 — lay in its ability to operate with little or no “human intervention.” The initial vision involved embedding sensors and actuators in physical objects like UPS packages and factory machinery to sense the environment, transmit “huge volumes of data,” and facilitate new kinds of automation.

But I’d argue that notion is shifting, and that people will be a more deeply intrinsic part of the IoT. And as the Internet of Things (IoT) expands to include people, companies that create value will need to understand user experience, psychological, and even some philosophical concepts much more deeply than they do now. They must learn how people really interact with things and why those things matter.

To make the IoT more human-friendly, the “things” involved need to do three things:

Things need to talk to other Things we use. Today, companies usually envision singular product offerings for the Internet of Things, resulting in store shelves with things that do not connect very well to other things once the consumer gets them home. Consider Google’s Nest or Schlage’s digital locks or smartphone-controlled home lighting systems. Each product functions perfectly well on its own, but doesn’t connect to other things in ways we might expect. Though people naturally rearrange things in their heads to complete everyday tasks, IoT products lack that flexibility. “You can control each of them from your smartphone…but the Nest won’t act to adjust the climate in response to the locks being keyed open, for example, nor to lights being turned on,” according to one user.

When things work together as we assume they should, our brains “cope smoothly,” displaying  “interaction-dominant dynamics” (IDS), to use the terms from cognitive science. By comparison, the standalone product design characteristic of many of early IoT consumer offerings leads to “component-dominant dynamics,” where a user’s ability to solve everyday problems by imaginatively connecting a number of elements is prevented by design.

Things don’t need to be so conspicuous. From smart refrigerator manufacturers to start-ups, high-design has become a predominant area of focus for the Internet of Things. Prototypes at one entrepreneurial firm include “a stylish leather clutch that can light up with a soft pulsing grid of glowing LEDs to let a wearer know she’s got a text message.” Similarly, Google just enlisted Diane von Furstenberg to design fashionable Glass frames, while the Cupertino-designed Apple Watch will eventually be angling to compete with stylish wrist-worn fashions from Geneva.

Yet companies should also note that in most of our work and play, we want things to be usefully inconspicuous, according to experimental research. Working in the kitchen, I interact with the refrigerator, knife, can opener, frying pan and stove in such a way that I “see through” each individual thing to the task of making dinner. If the can opener becomes the object of my attention and scrutiny, it’s because it’s malfunctioning and thus disruptive of my smoothly coping IDS.

Despite all the interest in eye-catching designs, cognitive science suggests most opportunities for the Internet of Things will arise by creating useful offerings that intentionally avoid sapping users’ attention away from what they’re trying to accomplish.

Things need to go beyond remote control. Today, IoT product designs generally emphasize process automation and ability to access a device from anywhere in the world. This “remote control” logic misses the fact that our most fundamental orientation toward things is one of physical connection and interaction rather than removal and distance.

As we go about our business in the physical world, the distance between mind, body, and things fades away. When I grab a hammer to install shelving, the distinction between “hand” and “tool” recedes into the unconscious, while completing the job becomes the main object of my thinking; in function and thought, the tool is the extended hand when it works properly. Even our words suggest this: the tool is “handy,” the completed bookshelves are “handiwork.” As cognitive scientists put it things like hammers became a part of the body’s “extended periphery” and are “functionally a component of the [subjects’] smoothly coping IDS.”

So, what might a “handy” IoT offering look like? An offering from New England Biolabs offers one example. The company’s biologist customers work by handling a variety of things, including petri dishes, microscopes, indicators, forceps, probes, slides, beakers, test tubes, and — importantly for the sake of this example — freezers stocked with enzyme samples.

Yet, in carefully studying the behaviors of its biologist clients as they interact with lab equipment, New England Biolabs recognized that running out of the right enzymes at the right time would often slow down experimental work and drastically reduce scientific productivity. Lacking the expected products, the freezer and its contents would suddenly become unhandy to scientists.

To solve the problem, New England Biolabs developed an IoT enzyme freezer to replace its conventional one. The IoT enzyme freezer tracks inventory levels of multitudes of enzyme SKUs, predicts demand based on patterns in biologist behavior, and ensures the right samples are always handy when researchers need them.

An IoT innovation that both recognizes the way users really think about things and removes barriers to a smoothly coping IDS, the new freezer makes experimentation more productive. “We get to the Eureka moment faster,” according to one user.

So remember: while much of today’s IoT rhetoric focuses on making things smarter, the distinctive value of the freezer derives from the way it makes people smarter.

Banning Affirmative Action Hurts Minority Enrollment in Elite Colleges

Bans on affirmative-action-based admissions in certain U.S. states are associated with a decline of 15% to 30% in the proportions of blacks and Hispanics enrolled in selective colleges and universities there, says Peter Hinrichs of the Federal Reserve Bank of Cleveland. Courts have upheld states’ authority to impose such bans, and Hinrich writes that nationwide, the tide appears to be turning against affirmative action. Average schools appear to be unaffected by affirmative-action bans.

How to Deal with a Mean Colleague

When a colleague is mean to you, it can be hard to know how to respond. Some people are tempted to let aggressive behavior slide in the hopes that the person will stop. Others find themselves fighting back. When you’re being treated poorly by a coworker how can you change the dynamic? And if the behavior persists or worsens, how do you know when you’re dealing with a true bully?

What the Experts Say

“When it comes to bad behavior at work, there’s a broad spectrum,” with outright bullies on one end and people who are simply rude on the other, says Michele Woodward, an executive coach and host of HBR’s recent webinar: “Bullies, Jerks, and Other Annoyances: Identify and Defuse the Difficult People at Work.” You may not know which end of the spectrum you’re dealing with until you actually address the behavior. If it’s a bully, it can be difficult ­— if not impossible — to get the person to change, says Gary Namie, the founder of the Workplace Bullying Institute and author of The Bully at Work. But in most cases, you can ­— and should ­— take action. “Know that you have a solution, you’re not powerless,” says Woodward. Here are some tactics to consider when dealing with an aggressive colleague.

Understand why

The first step is to understand what’s causing the behavior. Research from Nathanael Fast, an assistant professor at the University of Southern California’s Marshall School of Business, proves a commonly held idea: People act out when their ego is threatened. “We often see powerful people behave aggressively toward less powerful people when their competence is questioned,” he says. Namie agrees: “People who are skilled and well-liked are the most frequent targets precisely because they pose a threat.” So it may help to stroke the aggressor’s ego. Fast explains: “In our study, we saw that if the subordinate offered gratitude to the boss, it wiped out the effect,” he says. Even a small gesture, such as ending an email with “Thanks so much for your help” or complimenting the person on something you genuinely admire, can help.

Look at what you’re doing

These situations also require introspection. “It’s very easy to say, ‘Oh, that person is a jerk,’” Woodward says. But perhaps you work in a highly competitive culture or one that doesn’t prioritize politeness. Consider whether you might be misinterpreting the behavior or overreacting to it or whether you’ve unknowingly contributed to the problem. Have you in any way caused the person to feel threatened or to see you as disloyal? Self-evaluation can be tough so get a second opinion from someone you trust, who will tell you the truth, not just what you want to hear. Don’t put too much of the blame on yourself, however. “It’s important to balance not being threatening with not being a doormat, which just invites more aggression,” Fast says. Namie agrees: “Targets regularly assume it’s their fault,” when it’s not.

Stand up for yourself

Don’t be afraid to call out the bad behavior when it happens. “I believe very strongly in making immediate corrections,” says Woodward. “If someone calls you ‘Honey’ in a meeting, say right then: ‘I don’t like being called that. Please use my name,’” she says. If you’re uncomfortable with an immediate, public response, Woodward advises saying something as soon as you’re able. After the meeting, you could say, “I didn’t like being called ‘Honey.’ It demeans me.” Show that there is no reward for treating you that way. “The message should be: don’t’ mess with me, it won’t be worth your effort,” Namie says.

Enlist help

“Everybody should have alliances at work — peers and people above and below, who can be your advocates and champions,” says Woodward. Talk to those supporters and see what they can do to help, whether it’s simply confirming your perspective or speaking on your behalf.  Of course, you may need to escalate the situation to someone more senior or to HR. But before that, “you owe it to the relationship to try to solve it informally,” says Woodward.

Demonstrate the cost to the business

If you do need to take formal action, start with your boss (assuming he isn’t the aggressor). But you may need to take the issue higher up the hierarchy. When you have someone’s ear, Namie recommends, focusing the conversation on how the person’s behavior is hurting the business. “Talk about how it’s affecting morale and performance,” says Fast. Personal pleas rarely work and too often degenerate into he said-she said type arguments. “Don’t tell a story of emotional wounds,” Namie advises. “Make an argument that the person is costing the organization money.”

Know the limitations

When none of the above works you have to consider: Is this uncivil, mean behavior or am I being bullied? If you are in an abusive situation (not just a tough one), Namie and Woodward agree that chances of change are low. “The only time I’ve seen a bully change is when they are publicly fired. The sanctions don’t work,” says Woodward. Instead, you need to take action to protect yourself. Of course, in an ideal world, senior leaders would immediately fire people who are toxic to a workplace. But both Namie and Woodward agree that rarely happens. “Even though the statistics are clear on the impact on morale, retention, performance, it’s very hard for organizations to take action,” Woodward says. If you’re in an abusive situation at work, the most tenable solution may be to leave — if that’s a possibility. The Workplace Bullying Institute has done online surveys that show more people stay in a bullying situation because of pride (40% of respondents) than because of economics (38%). If you’re worried about letting the bully win, Namie says, you’re better off worrying about your own wellbeing.

Principles to Remember

Do:

Know that most people act aggressively at work because they feel threatened
Ask yourself whether you’re being overly sensitive or misinterpreting the situation
Call out the inappropriate behavior in the moment

Don’t:

Take the blame — many bullies pick targets that are highly skilled and well-liked.
Escalate the situation until you’ve tried to solve it informally and with the help of your allies
Suffer unnecessarily — if the situation persists and you can leave, do it

Case study #1: Don’t stay and suffer

Eleven years ago Heather Reynolds* took a new position at a veterinary clinic owned by another veterinarian named Adam* with the intention of buying into the practice. At first, Adam was thrilled about Heather coming to work with him. “He was positive, supportive, and encouraging. He was over the moon about me joining,” she says. After several months, she bought half of the firm and became Adam’s business partner.

Things continued to go well until a year later when, after what seemed like a minor disagreement, Adam stopped speaking to Heather for six weeks. When she confronted him, he told her he was considering dropping her as a partner. Heather was shocked. She had taken out a loan to buy into the firm and felt stuck.

Eventually, they got back on track but Heather soon learned this was a pattern of behavior. Any time there was conflict, Adam reacted the same way. “If I disagreed, he would ice me out. If I confronted him, he iced me out longer,” she says. She eventually figured out that stroking his ego was more effective. “You could flatter him, tell him how great he was, how he did well in a case, and he’d be back on your side. I learned to do this sort of dance in order to survive.”

But Adam’s harsh behavior took its toll on Heather. Last year, things got so bad that he didn’t speak to her for three months. Heather sought the help of a professional coach, who helped her see that Adam was a narcissist and a bully, who was threatened by her skills. Late last year, she told him she was looking for someone to buy out her part of the business and he offered to do it. “It was the best thing I could’ve done,” she says. “I wished I left when he first showed me who he truly was.”

Case study #2: Call out the bad behavior

Christine Johnson* was excited about her new role as deputy editor at a San Francisco-based media company. The position had just been  created so she would be managing a team of  existing staff, and everyone  welcomed her except for one person, Terry*. “What I didn’t know and I learned later was that he wanted the role and was angry that he didn’t get it,” she says.

During her first weeks on the job, Terry was aggressive. “I was constantly fending off little attacks from him,” she says. He kept asking her how she wanted to supervise their work, what processes she wanted to put in place, how he should interact with her about his projects. Looking back, Heather realizes these were all questions designed to make her look unprepared and incompetent. “And I was too green to say I didn’t know yet,” she says.

Terry started sending Christine 50 emails with return receipt before 9:00am. When she hadn’t responded by 11:00am, he would start emailing to ask if she’d seen his emails. “He was constantly badgering me. I actually considered quitting. I didn’t feel like I had any allies and wasn’t sure this was the job I wanted,” she says. After five weeks of this abuse, Christine stood up to Terry in a staff meeting. “He kept asking me questions over and over and I just lost my cool,” she says. She snapped at Terry and said, “I’m sick of you asking me so many unnecessary questions. Can you please stop?” Terry backed down.

Christine was embarrassed by her behavior but later, when she was in her office, people began stopping by to thank her for standing up to Terry. “Once I had a small amount of reinforcement from my peers, I knew I could take him on,” she says. And once he saw that she wasn’t willing to take her abuse, he stood down. “It got better and we were cordial but it was an awful start,” she says.