Marina Gorbis's Blog, page 1354

Tell Your Team What Customers Should Say About Them

How do you get employees to behave in ways that differentiate your brand to the people that matter most to your business: customer prospects, clients, partners, colleagues, and recruits?

Too many companies are still trying to create thick manuals that lay out every possible scenario and a corresponding brand-appropriate response — an “if they do this, you do that” kind of approach. Very reactive.

With the world a messy place filled with unexpected situations, it’s just not possible to anticipate everything.  (I’d argue it’s not even desirable.) So if you can’t script every interaction, what are some ways to drive a consistent customer experience from a diverse range of employees across an even more varied range of interactions? In preparing for a brand experience workshop with a retail banking customer recently one key element became pretty clear: You have to work from the outcomes back. And the best way to do that is to work back and from a single question: What do you want them to say after they walk away?

This is simple but powerful stuff. Let me illustrate.

I can tell my kids I want them to be honest, hardworking and well-behaved. But they — like your employees — can always ask: “What the heck does that mean?”

Instead, I can tell them: “I want your teachers to say you’re honest, sports coaches to say you’re hardworking, and grandparents to say you’re well-behaved. Not just think or feel it but actually say it.”

By flipping things around and being specific about the outcomes I expect from the various people they’ll encounter during their day, I’ve done a few things:

Changed the accountability. It’s no longer about ticking a box. Your responsibility doesn’t end once you’ve said or done something from a list I gave you. It ends when you’ve driven the outcome we’re looking for.

Accounted for the unexpected. If the focus is on what someone is going to say when they walk away, then it really doesn’t matter what the situation is that they’re walking away from. The consistency is not in the behavior but in the goal.

Activated their cultural knowledge. This is a big one. Everyone is different. And how you interact with someone to make them think you’re honest or hardworking or well behaved, may be very different from how I would do it. It’s the whole freedom-within-a-framework idea and puts the onus on them to figure it out.

Made it specific. By identifying the audience and the outcome, I’ve moved brand behavior from the land of the vague to the world of the concrete.

What did this look like for that retail banking client I was talking about?

Its leaders wanted their brand to be known for three things: ingenuity, simplicity, and humanity. So, instead of doing the usual — exhorting their employees to be ingenious, be simple, and be human — we translated those three things into what they should strive to get others to say about them (and, by association, the brand). Some examples:

“I didn’t expect him to do that, but I’m glad they did.” (Ingenuity)
“That was easy and well worth the effort.” (Simplicity)
“Wow, she gets it. She knew just where I was and what I needed.” (Humanity)

Of course, you have to supplement all of this with training focused on positive examples and parameters around what’s acceptable or allowed and what’s not. But by starting with the end and thinking about what you want people to say about your brand after you walk away, you’ve gotten a pretty good start.

For a New Way to Manage Risk, Look to the Past

By Focusing on Resilient Risk ManagementEbola Battlers Can Learn from Venice's Response to Black DeathNPR

Every now and then, a story comes along that makes us editors say, "Why didn't we think of that?" This is one of those stories, which looks at the devastating Ebola crisis through the lens of both history and risk management, with lessons that go beyond what's happening in Africa. In a recent article in the journal Environmental Systems and Decisions, a group of risk management experts dissect how Venice responded to the Black Death in the 1400s. At first glance, that response may seem chaotic; but "the authors of the article argue that beyond the chaos lay some surprisingly sophisticated crisis management," with civic leaders simultaneously enforcing rules like quarantines while also remaining "flexible enough to try alternatives when things went wrong."



This all comes down to what the article’s authors call resilient risk management. It differs from what usually happens, which involves "predicting the likelihood of various specific crises and devising specific solutions." Resilience theory holds that "many threats are fundamentally unpredictable or have unpredictable twists or secondary effects." Or as Igor Linkov, a coauthor, posits: "Can we design our countermeasures in a way that no matter what the threat is we still manage to do our best to recover fast?" In order to do this, you have to take two tenets to heart: Preparing and communicating with people before a disaster happens is paramount; and you also have to recognize that you don't have all the answers up front.

If You're Dating or Buying a House When Fewer Choices Are Worth MoreKnowledge@Wharton

If a real estate company were to tell buyers that they could only look at 10 houses at a time, and that each seller was showing his or her house to just 10 potential buyers, would it be more or less successful than a company that allowed buyers to see hundreds of properties? Pinar Yildirim of Wharton thinks it would be more successful. She and colleagues Hanna Halaburda and Mikolaj Piskorski have found that under certain circumstances, when companies offer limited choices to consumers, they can still successfully compete with other firms – and they can charge more. For example, one of eHarmony’s competitive advantages in the matchmaking market is that it limits competition on both sides of the match. So when you contact someone, your chances of getting a response are higher. On other sites, so many messages go flying around that people get inundated. The beneficial effects of fewer choices seem to apply to companies that provide platforms where both sides have to consent to a match. —Andy O’Connell

(Don't) Google ItThe Solace of OblivionThe New Yorker

By now, we're all familiar with the basics of this past spring’s European Union privacy ruling against Google: The European Court of Justice ruled that people in the EU "had the right to prohibit Google from linking to items that were 'inadequate, irrelevant or no longer relevant, or excessive in relation to the purposes for which they were processed and in the light of the time that has elapsed.'" That is: you have a right for certain information to be “forgotten” on the internet. So, what exactly does this mean in practice? Jeffrey Toobin visited Google to learn more about how they're reluctantly — but seemingly diligently — handling this new and unexpected aspect of their business, tracing the history of personal information-gathering that helps explain why the U.S. and Europe weigh privacy and free speech very differently. It's a nice primer on a range of views about what search engines should and shouldn't reveal, and how the extraordinarily powerful company in the middle of the battle is responding.

We're All WonderingLarry Ellison Bought an Island in Hawaii. Now What?The New York Times Magazine

The Hawaiian island of Lanai reminds me of Black Beauty, the 19th-century English novel told from the point of view of a horse that bounces from owner to owner, enduring kindness and cruelty and more kindness and more cruelty. Lanai was home to just Hawaiians for a few centuries, then fell under the ownership of mainlanders who ranched sheep and grew sugar cane and pineapples. Then it was owned by a California billionaire who built resorts and eventually tried to construct a wind farm, which provoked protests. Now, Green Beauty is mostly owned by Oracle founder Larry Ellison, who intends to transform it into a luxury tourist spot and “the first economically viable, 100 percent green community.”



One woman tells writer Jon Mooallem that Ellison is rejuvenating everything, and she feels blessed beyond her wildest dreams. In the past, Ellison has been quoted as saying that the island feels to him like “this really cool 21st-century engineering project.” But not everyone likes being part of someone else’s cool engineering project. Some residents seem to view Ellison’s actions with suspicion and uncertainty. “Like a lot of omnipotent forces, Ellison has remained mostly invisible,” Mooallem writes. “He has visited Lanai many times — locals told me they can tell he’s on the island when they see his yacht hitched in the harbor — but he seems determined to keep a formal distance from the community.” —Andy O’Connell

"Watch Yourself" Occupational Hazards of Working on Wall StreetBloomberg View

Michael Lewis knows a little something about Wall Street. And getting past the usual employee complaints about the financial sector (long hours, for one), he offers several often-hidden occupational hazards for the stellar university graduates who think they can make it in the industry while also holding on to ethics and personal responsibility. One: "Anyone who works in finance will sense, at least at first, the pressure to know more than he does." And many of the things you have to pretend to know can't even be known in the first place, he argues. "You will be paid a lot more to forget your uneasy feelings." Two: Working in finance does not involve joining "a team of professionals committed to the success of your bank." Instead, most who work on Wall Street and are successful "have no serious stake in the long-term fates of their firms." And three: "Anyone who works in big finance will feel enormous pressure to not challenge or question existing arrangements."



So for those embarking on a career in finance, Lewis has one last piece of advice: "Watch yourself, because no one else will."



Editor's Note: I've had the best time sharing with you the articles our editors have found to be important, controversial, useful, and sometimes downright entertaining. That's why I'm sad to announce that this is the last edition of the Shortlist. This doesn't mean we won't still be alerting you to the best reads from other places; rather, you'll be increasingly able to find them via our social media channels (Facebook, Twitter, LinkedIn and Google+). We will be reinvesting the editorial time that went into the Shortlist in exciting new formats we hope will help you work smarter, faster, and better.



So thank you for subscribing to the Shortlist. It's been such pleasure to write, and I hope it's been a pleasure to read, too. —Gretchen Gavett, Associate Editor

BONUS BITSResumes and Cover Letters

The Biggest Mistakes I See On Resumes, and How to Correct Them (LinkedIn)
Soon, You'll Have to Tell the Truth on Your Resume (The Wall Street Journal)
How to Write a Cover Letter (HBR)

What to Do When You Can’t Predict Your Talent Needs

Predictive analytics are often used in strategic workforce planning (SWP), to forecast and close the gap between the future talent you’ll have versus the future talent you’ll need. Now, powerful analytical tools are driving that organizational calculus. Those tools predict who will leave and when, where talent will be plentiful and scarce, and how talent will move between roles. But there’s a catch: Very precisely matching talent to “the future” is of little value if that future doesn’t happen. For example, it can take five years or more to develop today’s high potentials into leadership roles. Can you know today the five-year future for which you should prepare them?  Increasingly, you cannot. Yet, because HR strategy typically reacts to organization strategy, SWP often assumes a single future as its goal.

Does this mean predictive analytics don’t work for talent? No. Powerful analytics have value in preparing for a VUCA (volatile, uncertain, complex, and ambiguous) world, but optimizing your talent decisions will often mean balancing less predictive power applied to many futures, against more predictive power applied to one future. Options will often trump predictions.

Where’s the right balance? “Work diligently, but don’t fixate on one outcome.” In the yoga Sutras, this is Abhyasa (diligence) with Vairagya (non-attachment). It may be key to effective predictive analytics, especially for your talent.

It’s easy to think expertise can solve this problem through more accurate predictions, but Philip Tetlock’s book, “Expert Political Judgment”  reports results from over 20 years of evidence spanning over 80,000 expert predictions.  He found that “people who make prediction their business … are no better than the rest of us.”  In fact, the deeper the expertise, the more chance of missing something important. Tetlock found that “hedgehogs,” who know a lot about one big thing, predict less accurately than “foxes” who know less about any one thing, but a moderate amount about each of many things. Forbes said, “Experts who had one big idea they were certain would reveal what was to come were handily beaten by those who used diverse information and analytical models, were comfortable with complexity and uncertainty and kept their confidence in check.”

Do you approach strategy and talent like a hedgehog or a fox? With the power that predictive analytics bring, it’s even more important for you to answer that question — are you driving toward one deeply-analyzed future or keeping your confidence in check by preparing for many futures? A hedgehog would start with a confident position such as, “the middle class in emerging regions will be the main source of consumer growth over the next 20 years,” and deeply focus predictive analytics on how to meet that future. A fox would start with many positions (such as different likely regional growth predictions) and use predictive analytics to optimize a collection of tactics for different futures.

In finance, the “fox” strategy is similar to using real options, and it can help you make talent decisions just as it helps in your decisions about R&D, manufacturing and finance. Consider your talent resource like an investment portfolio. As with financial investments, you could “bet on the most likely future” (build talent to fit the one highest-probability scenario and win big if you’re right but lose big if you’re wrong), the typical approach noted above. Sometimes, organizations admit they can’t predict the future and “go generic” by building talent attributes like intelligence, engagement and learning agility that are generally useful in most future situations, but not a complete match for any one.

Or, you might “diversify” talent, building several different talent arrays, each one well-suited to a different future scenario, similar to holding diversified financial assets, each well-suited to a particular future.  Only a small portion of the portfolio will actually “fit” the eventual future, but skillful mixing in advance can optimize risk and return. Of course, people aren’t financial instruments. You can adjust a financial portfolio by selling assets, but removing or retraining talent requires careful consideration. Yet, in those arenas where VUCA-like uncertainty is pivotal to your strategic success, using predictive analytics to diversify your talent options may be wiser than using predictive analytics to bet big on one future.

A “hedgehog” approach to organization and talent strategy can be a trap, even when supported by powerful predictive analytics. Perhaps your strategists should be more like foxes, optimizing prediction and options, by knowing when analytics should predict many futures moderately, rather than one future perfectly.

Prevent Conflicting Messages from Confusing Your Team

We’re all a little bit crazy — and at some point, most managers have certainly felt that way about their subordinates. But maybe you’re the one driving them nuts. Are you presenting them with a “double bind”—that is, asking them to behave simultaneously in contradictory ways?

Organizations today routinely tell people to “Be empowered and innovative. Take risks;” while demanding at the same time “Make plan, and deliver on all your commitments.”  If you think this drives people crazy, you’re right. So what can you do to help keep your people sane?

First, don’t pretend that this conflict doesn’t exist.  Chris Argyris has described the sequence of events that happens when you fail to do so: Organizations craft messages that contain ambiguities or inconsistencies. They then instill craziness by acting as if the messages were not inconsistent. Finally, they seal the whole thing up by making the ambiguity or inconsistency in the message undiscussable, and top it off with making this undiscussability undiscussable, too. Argyris pointed out that the problem is not that people cannot deal with conflicting messages; they do it all the time. Mom says one thing and Dad contradicts. But it’s bad news when the “powers-that-be” pretend that their messages are not in conflict and effectively preempt any discussion of the matter.

Second, acknowledge that when people on your team act frustrated, confused, or hesitant there is a good chance that this double bind is at the root.

The remedy is simple. Discuss the undiscussable. Bring it right out into the open without any expectation that the original mixed message will change, because it probably won’t, at least in the near future. The good news is that it doesn’t have to. If people talk and laugh about it, even if only with friendly colleagues and especially their boss, it will go far in creating psychological freedom. Even if your subordinates and entrepreneurs inside don’t talk about it a lot, just the awareness of these mental structures will leave people less frustrated.

You can even let people know you feel the same way. You can laugh about it, too. It means a lot to your subordinate to know you understand the situation the same way he does. Once you’re talking about it, you may even find other creative ways of helping them navigate the bind. Even if you fail, the discussions will naturally lead to increased confidence and sure-footedness.

So, change the mixed messages at the “local” level whenever you can, and help the higher-ups see the effects of these messages “on the ground.”  While you can render the double-bind impotent, changing the originating mixed message is another thing altogether. But have heart. Surfacing and discussing structures like these is probably the single most important first step to effecting systemic change.

Any double bind inevitably means people live in a world of some discomfort. If you or your coworkers are frustrated, confused or reticent you might point out to them the inherent difficulty of being told both to do something and not do it at the same time! It’s pretty hard to find behavior that meets both instructions. Ask them what they might do with this situation. You can never tell what you might learn and you will certainly deepen your rapport with them.

Find the Best Local Markets to Drive Growth

As families settle back into school, parents start to worry about the viruses that naturally spread when children cluster together in classes. My colleague Tim Joyce and I have found a similar viral phenomenon with superconsumers — our term for people who buy big volumes of a product or service, but who often can be convinced to buy even more.

But instead of spreading germs, superconsumers spread growth.

Tim and I observed this while using big data to better understand the habits of superconsumers. First, we found that they tended to cluster together at a local geographic level. In our work with clients, we call these local areas “super geos.” Second, we found that these super geos had a network effect — in these areas, even people who don’t qualify as superconsumers tend to spend more on the product in question. Finally, we found that these super geos made it easier for companies to develop growth strategies. These super geos were local profit pools that were concentrated and big enough to offer big ROI upside for marketing and sales.

Per capita sales of a category can vary wildly across different parts of the country. We wondered if this was a random phenomenon. So we built several models regressing hundreds of macro-economic, category, consumer, and competitive variables to figure out what was driving higher per capita spending. Having a wide variety of variables was critical to get a complete picture.

Sometimes it’s not immediately obvious why some geographic markets are such big consumers of a particular product. For instance, the best markets for top-sliced bread (think hot dog buns) tend to have had three to four times the profit dollars versus the average local market. What makes them unique? It turns out that these super geos tended to be in areas with high concentrations of elementary schools (which serve lots of bun-oriented lunches), warmer climates (more year-round bun usage at cookouts), and a strong lead grocer (which gives the bun-maker more willingness to invest to gain more shelf space). While we don’t know if super geos make superconsumers or vice-versa, we do know that in each instance it is not random. Certain local markets have the right ingredients to ripen demand.

Second, we found that within and adjacent to these super geos, non-supers spent more on the category than the average non-super nationally. This network effect reflects the power of “word of mouth,” which McKinsey says is the primary factor for 20-50% of all purchase decisions. Given that superconsumers are the most insightful and articulate consumers of a specific category, it is no surprise their influence is felt by regular consumers nearby.

In one entertainment category, for instance, non-supers who lived near superconsumers spent 20% more than the average non-super. This is like peer pressure with children.  If you give one child a treat, the other children want one, too. This also works broadly in other areas like private label brands. In some cities (such as Las Vegas), $1 out of every $3 spent at the grocery store go to private labels; in other cities (such as New York), the ration is one-in-eight. If you see enough friends using store brand products, you’re more likely to consider it and buy it yourself.

Finally, when we analyze the economics of these super geos we find that these are attractive local profit pools waiting for companies to get after. In some cases, the top 10 super geos have accounted for 50-60% of the incremental profit pool for companies. This can meaningfully change the ROI equation for how a company goes to market. National marketing may make sense for efficiency sake when only one-in-ten consumers is a superconsumer. But if superconsumers account for one-in-four customers ina  particular market, shifting from TV to digital marketing may make sense, because digital can very precisely find and reach superconsumers.

Some companies we talk to are beginning to question the core assumptions of their growth strategy. Ideas like economies of scale (manufacturing, sales, and marketing) are still relevant, but may have diminishing returns. National plans/strategies have long been efficient, but their effectiveness is in question as the US, in particular, is increasingly diverse in demand. Most European, Asian, and Latin American executives would laugh at the idea of a “continental” growth strategy. One wouldn’t assume the demands of Belgians, Luxembourgers, and Dutch are the same because they are part of Benelux, right? Yet, the vast majority of growth strategies we encounter fundamentally assume all Americans are more or less the same irrespective of where they live. “National average” may be two of the most misleading words in business.

Precision business models and one-to-one marketing may still feel out of reach for some. But perhaps the compromise between mass marketing and CRM is “GRM” — geographic relationship marketing. Super geos seem to show that the decision between a mass marketing/scale driven business model or a precision/niche business model is a false choice. And the best of both worlds is possible.

Women Negotiate Better for Themselves If They’re Told It’s OK to Do So

In an experiment, few women who applied for administrative-assistant jobs entered into negotiations about their wages, and of those who did, more negotiated them downward than upward, say Andreas Leibbrandt of Monash University in Australia and John A. List of the University of Chicago. For example, a typical comment from a female applicant was that the posted wage of $17.60 per hour “exceeds my expectations. I am willing to work for a minimum of $12.” But if the applicants were explicitly told that the wages were “negotiable,” more women negotiated them upward than downward, by a ratio of more than 3 to 1.

Read Fiction with Your Coworkers

I have to confess that I have never entirely understood the concept of “summer reading” for adults. In the Northern Hemisphere (especially the northern part of the Northern Hemisphere, where I live) the three months of summer offer a rare chance to be outside in weather that is actually enjoyable. Kids are out of school, colleagues are out of the office, and, if you’re lucky, weekends are out of a suitcase by some sort of body of water. Who has time to read?

But in fall and winter, the longer nights are perfect for curling up with a book. So when I recently heard about a new nonprofit, Books@Work, dedicated to bringing pleasure reading to the workplace, it seemed like the ideal opportunity to dig a bit deeper. I spoke with Ann Kowal Smith, Executive Director of Books@Work, about how reading groups can make a difference at the office. What follows is an edited version of our conversation.

HBR: You describe Books@Work not as a book club, but as a “voluntary seminar.” What’s the distinction?

In a book club, people come together in a very informal way. Our programs are led by a professor, and the professor brings a degree of expertise about a text that he or she is very passionate about. At the same time, the goal of the program is not to focus on the text alone, but to use the text as a window to exploring ideas. I often think of it as a hybrid between a college seminar and a book club.

Who participates?

A large part of our target audience is the 60% of the American adult population who hasn’t had the chance to go to college. It gives the folks who don’t usually get company-sponsored professional development a chance to have a turn. At the same time, we have found that cross-functional and cross-hierarchical programs – where participants from the shop floor are sitting next to the division president – can play an important social role in the organization.

Have you seen any impact on the organization itself, or is this mostly just a fun “perk”?

Sharing these books is a way to get to know each other better. We’re also talking to supervisors and asking, “Are employees more engaged, working better as a team, more innovative? Has there been a difference in retention?” While it is early days, we have seen quite a few cases already of supervisors telling us that they’ve seen people more willing to speak up, to share an idea, to disagree – it’s a lot more comfortable to practice in the seminar and then in the workplace, especially if it’s very hierarchical.

What are some of the books that you have seen spark the best discussions?

It varies group by group – there’s not one magic book. But we are adamant about using never using a business book or a self-help book or a “how to” book. Some of the books that have been the best well-received are the ones you wouldn’t think would be interesting in the workplace. The conversations are so much richer.

In one company, a professor led a discussion of Edith Wharton’s The Age of Innocence and the group started talking about the similarities between what was happening in [Gilded Age New York] and what we see in society today.

Another example is David Guterson’s Snow Falling on Cedars, where one of the big themes is the strong “us and them” feeling in the community after WWII. Although this had nothing to do with the workplace of the readers, they had recently gone through a merger and got to talking about the struggle to become one community.

The very first book we did was with a group of female cafeteria workers. They read Germinal by Emile Zola. It’s a hard book. It’s about the working conditions of a mine in the 19th century. Zola really gets at the question, “Why do some people have higher standards of living?” and other core class issues. What the professor told me was that the participants loved it, and she did, too – she got a very different perspective from the one she hears in her college classes with undergrads. She said she’ll never teach the book the same way again.

Are there books that have just fallen flat?

There are some that are just too arcane. They become a bit challenging. One group struggled with Gulliver’s Travels. Another read Annie Proulx’s Close Range: Wyoming Stories, which is the short story collection that includes “Brokeback Mountain.” “Brokeback” is actually one of the more uplifting stories in the book — it’s a dark book. So while the book spoke to everyone, everyone said reading it was a slog. Even a book that frustrates people still gives them something to reflect on.

I think I know what you mean. I recently read The Orphan Master’s Son, which is this really compelling story about North Korea, and it was a great book but a hard read, emotionally.

Exactly.

I can’t help but think to some people, this might seem like an imposition on their personal time – a further incursion of work into personal life. Do you ever have any negative reactions from employees to this project?

We’ve never had a situation when someone was so forced into doing it that it heavily impinged on their personal time. Everyone has the option to say, “This isn’t for me.” Our offer is not, “this would be good for you, so you should do it.” It’s more, “We think you might enjoy this, and we’d love to provide it for you as an extra.” Generally the discussions happen at least partly on company time, so they’re not using personal time except to read the book.

If someone wants to “try this at home,” so to speak, what’s the key to guiding an effective discussion in a work context?

Pick a book that has broad human themes that are not necessarily related to a particular workplace, but let the reader stand in someone else’s shoes. The closer you get to the workplace, the more instrumental it feels and the harder it is to get people excited and engaged. When the book is totally unrelated, it’s amazing how many links the readers find back to [their work]. The facilitator should let people find the connections themselves not tell them what they should be discussing.

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Eric Schmidt, executive chairman, and Jonathan Rosenberg, former SVP of products, explain how the company manages their smart, creative team.

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Two Forces Moving Business Closer to Climate Action

This week, CEOs and world leaders met at the UN to talk climate. In the run-up to these high-level talks, many companies and some relatively new voices from the business community have been sounding both the alarm and the rallying cry for action. At the same time, the cost of renewable energy has dropped very far, very fast. It’s a perfect storm bringing us to two important tipping points: one of belief and commitment to action, and one of economics.

But there’s still a major disconnect happening in one other area: the relationship between business and citizen consumers.

First, though, a few of the highlights from the business community:

In June, former U.S. Treasury Secretaries Paulson and Rubin joined New York Mayor Michael Bloomberg in issuing the Risky Business Report, a pithy, hard-hitting look at how much climate change is “already costing local economies” billions and the hundreds of billions of assets and property at risk in the coming years.
In July, General Mills — nobody’s idea of a radical company —  expanded the pro-climate lobbying group BICEP beyond the usual suspects (Nike, Starbucks, Ben & Jerry’s) to add a distinctly mainstream voice to the call for policies like a price on carbon. Kellogg’s officially joined the group yesterday as well.
Last week, “The Better Growth, Better Climate” report from the Global Commission on the Economy and Climate exploded the myth that we have to choose between building a prosperous, expanding economy and doing it in a way that protects our shared home and resource base (also called the planet).
This week, an important coalition of coalitions, We Mean Business, launched with its own report and commitment by large organizations to recognize the reality of climate science and the ability to act on it. One exciting offshoot of We Mean Business, called RE100 launched as well, with Swiss Re, Mars, IKEA, and others making the bold commitment to use 100% renewable energy. (Disclosure: I’m on the steering committee of RE100 this group working to bring in corporate members.)
This week, the World Bank, representing a group of 73 countries and 1,000 businesses — including many of the world’s largest — issued their own commitment to pricing carbon.
The cherry on top of the sundae this week was the Rockefeller Brothers Foundation — a $900 million pool of money that originally came from oil fortunes — announcing it would divest itself from fossil fuel companies.

This is all representative of the first tipping point: The large-scale commitment and belief in climate action in the private sector. If it’s not clear by now, this is no longer a fringe movement in business. The CEO leaders of the parade, like Richard Branson and Unilever’s Paul Polman, took the stage at The Climate Group’s climate week launch event in New York on Monday. Polman implored the world’s governments to stop heeding those companies, presumably the fossil fuel giants, with enormous political influence: “Don’t just listen to the few voices getting disproportionate air time, but to the majority of business now — they’re asking for a price on carbon, and more support for cleaner technologies and efficiencies.”

Polman and Branson are expected at these meetings now, but more leaders are joining. Apple’s Tim Cook spoke as well, saying “the time for inaction has passed,” and commenting that we don’t need to accept any “tradeoff between economy and environment — both are doable if you innovate and set the bar high enough.”

As it turns out, that bar doesn’t have to be so high after all. What’s really compelling about the new reports is the data on how cheap it’s becoming to slash carbon.

This is the second tipping point that will really drive action: The economics behind a clean economy shift are very strong. The We Mean Business report cites an internal rate of return of 81% (that’s a ridiculous payback) on energy efficiency in the U.S., and an IRR of 27% for those companies with the most aggressive, science-based goals and actions on climate. Even the most “expensive” options like renewables are becoming cheap so fast that it’s making CFOs’ heads spin. Even those hippies over at asset manager Lazard calculate that the cost of solar PV technologies has dropped nearly 80% in five years. Assuming that we’ll lose money by radically cutting carbon has become a radically outdated idea.

So business is moving closer to going all in on this clean economy thing, making what I call the Big Pivot toward a new way of doing business. A couple notes of caution though before we break out the bubbly, though. Two other pillars of society — government and citizens — need to make headway as well. Government doesn’t have a great track record of global negotiations on climate policy, but local and regional action is more robust, with 46 carbon markets globally covering a small but respectable 12% of emissions.

We citizen consumers need to step up, too. I brought my family to the amazing climate march on Sunday in New York. Hundreds of thousands of people made their voices heard. But there was a large dose of anti-corporate, anti-capitalist messaging in the crowd. I get it — business does some nasty things and the obsession with short-term profit maximization above all other definitions of business value is a pathology that’s dangerous for society and for business. But it’s not helpful to cast all companies into the same lot.

Companies in the clean economy world, a large and growing industry worth trillions, want action on climate and carbon, and they want it badly. But so do other mainstream companies. I marched in the business section (if you could call it that) on Sunday. Executives and employees from Unilever and Seventh Generation were there, but so was David Crane, the CEO of utility NRG, which currently uses coal for the majority of its energy. Crane is another one of those CEO voices making real noise – he’s “mad as hell” and wants a clean energy revolution. Crane’s treatise first asks all of us to think about our energy and put up solar panels. He’s smart to ask for consumer action and policy changes — both will make it much easier for NRG and other energy companies to chart a new, cleaner path forward.

It’s easy to march against the current system, but harder to commit to something to march for. Bringing the voice of the people and business in line is another tipping point we need to foment. Business can’t thrive unless the planet and society are thriving as well. But the reverse is true also — we can’t build a prosperous future without the resources and innovation that business provides.

The tipping points the business community is hitting are critical, but we need a society-wide movement, working together without creating unhelpful divisions. The climate isn’t a citizen issue or business issue — it’s an everyone issue.

Why We Hide Some of Our Best Work

Your employer can track your every move, no matter where you sit in the organization. Often, the impulse is to scrutinize all behavior — through real-time performance data, for instance, and open workspaces — so that nothing unproductive or unethical can lurk in the shadows.

But that much transparency can have a dampening effect on performance. Creativity and productivity suffer because the desire for control is so great. And that’s not an acceptable tradeoff, even in an age of reputation management, because this also happens to be an age of innovation and complex problem solving.

You can see these consequences in the results of a behavioral study at LEGO: Parents staged their kids’ childhoods with such a heavy hand — subjects’ bedrooms were “meticulously designed” and “suspiciously tidy” — that they left little space out in the open for truly creative play. The kids responded to living in such a highly controlled environment, with close parental surveillance, by stashing their favorite toys out of view. One boy hid a shoebox filled with “magic poisonous mushrooms” under his bed. Bottom line: The kids wanted privacy so they could play more freely and inventively — and to get it, they resorted to hiding the things they really cared about.

Workers similarly conceal their most creative thinking and problem solving from management when they feel scrutinized, because they fear retribution for not following carefully prescribed norms. It’s easier that way. They appear to be falling in line, doing what’s expected, so they’re left alone. Unfortunately, this also means they’re not sharing the improvements they’ve created and the lessons they’ve learned. It’s one of transparency’s biggest traps (for more detail, see my recent article in HBR). Managers think they’re seeing more in an utterly transparent environment, but they actually end up seeing less.

In a world where anything visible is likely to be assessed or evaluated, people respond as you would expect them to: They keep the most important things under wraps in an effort to manipulate what others think of them. The incentives run counter to authenticity, productive deviance, and simply getting work done efficiently.

Consider what’s happened in health care reform, particularly in recent reforms to how hospitals conduct rounds. Patients and family members are now being included in rounding discussions, which means some of the conversations that doctors and other care providers used to have amongst themselves have become taboo. While Socratic method may have previously been the norm for teaching residents, getting something wrong in front of the patient and family would result in a loss of credibility. And having the patient witness real-time problem-solving in a complex diagnosis may cause more anxiety than relief.

What’s the solution? Finding the sweet spot between transparency and privacy. HBS researcher Bethany Gerstein and I observed a smart approach at the liver transplant ward at the Cincinnati Children’s Hospital Medical Center: Do the problem solving and teaching in a private space, before conducting rounds. That frees caregivers to make their rounds more transparent and family-centered, because the messy work of discovery has already happened backstage.

As one senior member of the rounds explained, “We actually do the pre-rounds to get everyone on the same page.” It helps the team “come up with a solidified message so that when we talk in rounds in front of the family, the plan is clear.”

All this jibes with what my colleagues and I have observed in other organizations. When people can solve problems without a spotlight shining on them, they become less defensive and, as a result, more creative and productive.

You may find that to be true in your own work. What’s more, your employer doesn’t have to sacrifice the benefits of transparency to ward off its ill effects. Chances are, you’ll end up sharing more of what you learn if you aren’t afraid it will be used against you in a performance review or somehow put your reputation at risk (as in the hospital rounds example). After all, the LEGO study subjects were all too happy to share their secret toys and ideas with the researchers — because there was no penalty for doing so.