Marina Gorbis's Blog, page 1413

Google’s Strategy vs. Glass’s Potential

When professor Tom Eisenmann first taught his newly released case on Google Glass at Harvard Business School, he asked his students which of three scenarios was most plausible: that Glass would catch on first in the enterprise setting, followed by gradual consumer acceptance; that adoption would be limited to early adopter “digerati” consumers; or that mainstream consumer adoption would happen rapidly.

Many students voted for the first scenario. They’re not alone.

Firms like Deloitte have predicted robust consumer demand for smart glasses, with global adoption reaching “tens of millions by 2016 and surpassing 100 million by 2020.” But early reports suggest that professions from medicine to manufacturing are interested while consumers remain wary. As Quartz reported last year:

Members of the Glass operations team have been on the road showing it off to companies and organizations, and they told Quartz that some of the most enthusiastic responses have come from manufacturers, teachers, medical companies, and hospitals. That suggests that they may be trying to persuade firms to buy the device and develop applications for it.

Sure enough, in April Google announced “Glass for Work,” an initiative aimed at developing more work-related apps on the Glass platform.

Glass may yet turn out to be a great consumer success. But in the meantime, Google’s choices in marketing and distributing its new product get to the heart of the tension between new opportunities and existing strategy.

Google’s strategy to date has been to build great consumer software, then extend these popular applications to enterprises with additional features, often at a fraction of the cost of competitors. Despite the Glass for Work announcement, it is clear both from the case and the company’s public positioning that it conceives of Glass first and foremost as a consumer device. In March, it announced a major partnership with Luxottica, the world’s largest eyewear company, a move clearly aimed at the mainstream market.

At the same time, the case indicates that the team behind Glass recognizes that it doesn’t yet fully know what it has created. Glass product manager Steve Lee is quoted as saying:

Major new consumer tech products are rarely brought out of the lab at this stage of development. But we knew that by putting prototypes into the wild, we’d start to learn how this radical new technology— something that sits on your face, so close to your senses—might be used.

One of the things they seem to have learned is that there is meaningful demand for enterprise applications.

Google has never been afraid to branch out beyond its core business; it expanded beyond search into email, chat, mobile operating systems, and more. But all these cases were complementary in that they were aimed at consumers.

Glass is different. It is one of the first products to launch out of Google X, the company’s research lab that aspires to “moonshot” innovations, and which is also developing a self-driving car. In 2013, BusinessWeek quoted Google X director Astro Teller as saying, “If there’s an enormous problem with the world, and we can convince ourselves that over some long but not unreasonable period of time we can make that problem go away, then we don’t need a business plan.” Of Glass, he said:

“We are proposing that there is value in a totally new product category and a totally new set of questions… Just like the Apple II proposed, Would you reasonably want a computer in your home if you weren’t an accountant or professional? That is the question Glass is asking, and I hope in the end that is how it will be judged.”

The comparison to the PC is telling. Google has been at the forefront of the trend toward consumer technologies being adopted by enterprises, but the history of computing contains more examples of the reverse. The adoption of computers by firms predated the rise of the PC, and the killer app for the Apple II was VisiCalc, the first ever spreadsheet program.

What if the opportunity in smart glasses really is in enterprises, or at the very least starts there? Should Google revise its strategy to pursue that opportunity?

Numerous frameworks exist for answering this question. Some emphasize the importance of sticking to innovations adjacent to a firm’s core business. Others suggest that a subset of innovation projects be aimed at entirely new markets, regardless of adjacency. Still others offer different deciding factors, like whether management is supportive. But ultimately Google is Google. With Google X the company is attempting to put its mark on the very process of technological innovation. In doing so, it will have to decide for itself whether innovation follows from strategy, or whether it’s sometimes ok for it to be the other way around.

Whatever the answer, there is a lesson here about transformative innovation. Though you may set out to explore strategic territory, there’s no guarantee that that’s where you’ll end up.

When Innovation Is Strategy

An HBR Insight Center




How Boards Can Innovate
When to Pass on a Great Business Opportunity
How Samsung Gets Innovations to Market
Is It Better to Be Strategic or Opportunistic?

Zappos Killed the Job Posting – Should You?

Zappos is often out in front of new and unusual HR policies. It originated the “pay employees to quit” policy adopted by Amazon.com. And now, Zappos will abandon job postings, according to Stacy Donovan Zapar, Zappos’ Social Recruiting and Employer Branding Strategist. The “abandon job postings” policy recalls an earlier era — as Zapar says, “It’s old-school recruiting, made new and fresh again.”

So does this mean you should abandon job postings too? The correct answer is “it depends.” Shiny new HR practices should motivate savvy conversations, not just imitation. In this case, organization leaders should demand a conversation about talent sourcing as sophisticated as one about their supply chain.

An important piece of context is that Zappos has long used social channels to describe their culture, people, and events. Now, they have added the Zappos Insider program, which Zapar describes as a place “where people can sign up, stay in touch, talk to real people with real names and real faces, get to know us and allow us to get to know them. Our Insiders are people who might like to work for Zappos someday … today, tomorrow or at some point in the future.” It’s an old-school idea common to technology companies as far back as the 1980’s, akin to “we know more about the engineers that work for our competitors than they do.”

Another context element is that this policy applies to call centers, which employ a large number of people doing jobs that are similar, easily described, and familiar to most applicants. These are pivotal roles with significant consequences at Zappos and Amazon.com. Indeed, Zapar notes that Zappos received over 31,000 applications last year, responded to every single person who applied, and hired only 300 of those applicants. So, Zappos had a large existing staffing investment to work with. The company still has job descriptions “with actual titles and actual job descriptions and actual requirements, we’re just not posting them externally anymore.” So, abandoning job postings doesn’t mean random hiring.

These policies can be effective for Zappos, but how should you decide if they are right for you? Approach that question logically, and with sound fundamentals. Let’s “retool” the Zappos strategy through the staffing supply chain, to see how their innovation can spur a great conversation.

Zappos has a “labor pool” with some applicants who “spam post” resumes. Their new policy can yield an “applicant pool” that weeds them out in favor of applicants who invest effort interacting with Zappos employees. Zappos hopes to “screen” and “select” better, as Zapar describes, “We’re having conversations with candidates, getting to know them — their strengths, their interests, their personality — and matching them to jobs on the back end. Hard skills match is 50% of the equation but, as Scott mentioned, culture fit is 50% of the equation for us.” Zappos might also see benefits at the “offering and closing” and “onboarding” stages, because decades of research suggests that candidates who devote effort to the recruitment process more readily accept an offer, and a “realistic job preview” increases candidate commitment and performance.

The staffing supply chain also reveals why the policy may not work for everyone.

Some applicants may be unwilling to spend time on the Insider site, particularly those with attractive alternatives. Zappos receives 100 applications for every vacancy, so they can probably take that chance. If your jobs are less familiar, more unique, or less attractive, your supply chain optimization may require getting more people into the pipeline, with an application process that makes it as easy as possible for them to apply, perhaps even an online job posting.

Zappos hopes the Insider site will help reveal culture fit, and believes that is best assessed through conversations and interaction. That sets a high bar for Zappos employees and hiring managers. They need to develop and analyze interactions rigorously and effectively. As Zapar said, “We’re just cutting those boring ole job postings out of the discussion and proactively chatting with candidates ahead of time so we know exactly who our top potential candidates might be by the time the opening becomes available.” Evidence suggests that chatting with candidates is not a valid approach, unless you invest in well-informed, disciplined, and skilled interviewers. At Zappos, the investment may be sensible, if 50 percent of performance hinges on culture and when the investment can be amortized across hundreds of yearly hires.

However, if you have a job for which the skills are rare, and can be identified from resumes or work samples, then your optimal supply chain should attract lots of resumes and work samples, perhaps even using algorithms rather than humans to winnow the pool in the early stages based on hard skills. You might even assess culture fit through deep conversations as Zappos does, but perhaps with a small number of well-trained interviews on a much smaller pre-selected group of candidates. You might “build” rather than “acquire” culture fit. Organizations like Disney, Toyota, and the military choose to use onboarding processes that nurture their unique cultural values beliefs and norms. If the talent you need is extremely rare, the optimal supply chain may not hire at all, but rather crowdsource from thousands of candidates who never become employees, removing the need to assess culture fit.

Companies like Zappos do a great service with their HR innovations, but that doesn’t mean you should simply copy them. HR and organization leaders should use them to pose good questions and have smart discussions.

When We Learn From Failure (and When We Don’t)

When do you pass the buck and when do you take the blame? New research shows most of us only cop to failures if they can’t be attributed to something – or someone – else. But when we dodge accountability, we prevent ourselves from learning.

In their recent HBS working paper, Christopher G. Myers, Bradley R. Staats, and Francesca Gino identify what they call an ambiguity of responsibility, which plays a powerful role in determining when you learn from failure and when you don’t.

It goes something like this: When we fail, we internally pinpoint what the authors call an “attribution of responsibility – namely taking personal ownership for the outcome or blaming it on external circumstances.” If you take personal ownership, their research shows you’re much more likely to learn from and work harder after that mistake.

But in cases when it’s unclear if you’re responsible for the failure, you’re “less likely to internally attribute a failure, and thus less likely to learn,” Myers told me. Importantly, he pointed out that this could be the case even when someone is highly accountable for the outcome. “Francesca Gino and Brad Staats have shown that surgeons learn far less from their own failures (learning instead from their own successes and others’ failures), presumably due to the ambiguity that comes from a bad surgical outcome – the surgeon is held accountable for the outcome, but it is unclear if it is his or her responsibility,” he said. “For example, there could have been an unforeseen complication, an error in another part of treatment, et cetera.”

Importantly, this means that even when people intend to learn from errors, the “ambiguity of responsibility” can undermine those good intentions.

The researchers came to these conclusions after putting volunteers through several experiments. In the one, subjects had to decide whether or not a car should be cleared for an upcoming race – a situation modeled directly after the Challenger explosion. One piece of crucial information – the likelihood of a gasket failure (99.99%) – was omitted, but available via a link. Later, the same group was given a similar test in which they had to identify a potential terrorist, with additional information available via email.

Those who had taken responsibility for their failure to prevent a car crash in the first example – “I just did not take the time to read all the information and jumped to a conclusion based on what was initially presented to me, without reading everything” – were more likely to be successful on the second task. Those who attributed their ultimately disastrous decision to an outside factor – “You can’t expect a person to make a responsible decision on any problem when you leave out one of the major key factors in it” – were less likely to succeed in identifying the fictional terrorist.

In a second round of experiments, subjects were told they’d failed on a blood-smear labeling task (even if they hadn’t), but given two different reasons: Half the group was informed they weren’t engaged enough in the task, while the other half received word there was a potential problem with the web browser they were using. The researchers found that the latter group often attributed their failure to the possible browser glitch. For example: “Apparently, the browser has some difficulty with displaying/labeling these images correctly and that could have hindered my overall performance.” When the entire group did the task again, those who’d been told that they weren’t engaged enough took more time (an indicator of increased effort) and performed better than the browser-glitch group.

The problem, in the real world, is that it can be incredibly difficult to decrease ambiguity when it comes to failure – after all, many of our assignments involve teams of colleagues, multiple stakeholders, glitchy technology, or other unpredictable factors. So how can managers encourage learning when it’s difficult to pinpoint responsibility?

Myers has a few suggestions, including removing the obstacles that can create ambiguity in the first place – a browser that may be faulty, for example, or complicated processes. “Managers could also think carefully about the role of job design – such as the scope of responsibilities and reporting structures – to craft jobs that don’t have ambiguity ‘blind spots’ built in,” he says.

It’s equally important to make failure safe within an organization. “Creating a culture of psychological safety, where individuals are encouraged to acknowledge and learn from failure, can help employees feel less psychological pressure to avoid internal attribution.”

He recommends trying non-punitive root-cause reviews when a team fails, which can result in both learning for those responsible and for other team members who can learn vicariously.

“This can certainly be a challenging cultural element to build,” he cautions. “But books like Failing Forward provide a number of great examples of these kinds of practices that might jumpstart a manager’s efforts.” Another place to start is in HBR’s 2011 failure issue, which includes an important article from HBS professor Amy C. Edmondson on how leaders can better understand failure and make it a central part of their strategies. Edmonson illuminates the big difference between knowing that failure is a valuable learning experience and actually making it a core part of a company’s ethos, and offers five key suggestions on how leaders can build a psychologically safe environment. Among them: create a shared understanding, or framing, around the types of failures that employees can expect to happen at work; and reward the messenger who brings up bad news.

“My experience is that we learn much more from failure than we do from success,” P&G’s A.G. Lafley told us in that issue. He’s right – but this new research, in addition to what we already know about failure, also demonstrates that learning depends on more than one person’s ability to suck it up and declare, as the white paper’s title puts it, “My bad!”

3 Priorities for Leaders Who Want to Go Beyond Command-and-Control

It’s cliché to say that “command and control” leadership is no longer relevant in most organizational contexts. But — especially in large, global, diverse organizations — what should it be replaced with? Leaders increasingly need to model traits that reflect the values and culture of the organization in which they operate. It’s nearly impossible to capture all those traits — every organization will have a different set of norms and customs. But there are at least a few essential leadership traits that we find common in many firms today.

First, in a world in which labor markets are fluid, leaders must inspire and impart purpose. When one of us interviewed young leaders for a book, two of the top three reasons they sought particular jobs were “intellectual challenge” and “opportunity to impact the world;” and other studies have consistently highlighted the increasing focus younger workers in particular place on purpose in the workplace. Anecdotally, that emphasis on finding purpose in our workplaces and in the companies we patronize — or as Simon Sinek might phrase it, starting with “why” — is redefining the way innovative companies like TOMS, Zappos, Whole Foods, and Google attract and retain talent. And at Red Hat, where one of us is CEO, the organization’s mission is a powerful catalyst in communities of customers, contributors, and partners for creating technology the open source way. The people who succeed in that context are those who are most inspired by that mission and are able to pass that inspiration to others and impart purpose in everything they do.

Second, as the pace of change in the marketplace quickens, leaders must adapt and engage. Many modern organizations simply can’t afford to hold constant for too long. To some extent that has always been true. One of our favorite quotes is from World War I German field marshal Helmuth von Moltke who said, “No plan survives contact with the enemy.” The other favorite is Mike Tyson: “Everyone has a plan until they get punched in the mouth.” Command-and-control isn’t a fading leadership model simply for cultural reasons, but because modern organizations must respond in real time to fast-changing consumer preferences and agile competitors. This can only be done effectively when leaders have engaged their organizations deeply enough that employees aren’t simply executing tasks; they’ve understood and internalized the “whats” and “whys” of the strategy deeply enough that they can innovate on and improve that strategy as the market demands. This requires intensive, one-on-one work. At Red Hat, for example, the senior team is held accountable for how associates (Red Hat’s way of referring to “employees”) answer the question: “I understand Red Hat’s strategy and what I can do to make it successful.” This call for engagement and adaptability also requires leaders who are willing to empower the community to adapt and solve problems, and who are willing to listen to those with whom they work rather than simply doling out commands.

Finally, in this environment so reliant on inspiration, purpose, and engagement, leaders must embody authenticity. Bill George, among others, has written eloquently on the demands of authenticity for some time; but the demands of authenticity — and the ways in which colleagues can perceive a lack of authenticity — are widening. In our  travels speaking to young and senior leaders alike about the changes technology is catalyzing in modern organizations, the theme of increasingly blurred personal and professional lives — wrought by a combination of social media and “always on” mobile technology — has been perhaps the most prevalent. Coworkers know who you are and what you value and can more easily discover when your personal values and actions conflict with what you say in the workplace. We see this as positive because it allows leaders to be themselves at work — vulnerabilities, values, and all — and view those very vulnerabilities and emotions as a central way in which leaders can connect with coworkers in deeper, more human ways, an opinion shared by others like Brene Brown. This very personal approach to authenticity also helps reinforce the truth that there is no one prototypical effective leader. A variety of leadership traits and characteristics may succeed in different circumstances and their combination in the context of a team leads to strength in diversity.

Are you and the leaders with whom you work learning to adapt to a changing model of leadership? Certainly, there are a multitude of traits that will be important depending on the context in which you work. But inspiration and purpose, adaptability and engagement, and authenticity will be critical to most leaders in the information economy.

Managing a Negative, Out-of-Touch Boss

The most frequent question I get asked by the 250,000 people enrolled in my MOOC on leadership is, “How do I deal with my boss who is not only dissonant, but quite negative?” These bosses are “dissonant” in the sense that they’ve lost touch with themselves, others and their surroundings — and it’s nothing new. They come across as negative, self-centered, focused on numbers, and their employees feel like they’re being treated as resources or assets (not as human beings).

Why are these people still in management positions? Often, it’s because we excuse them for their incompetence or rude behavior because they are a rain maker – maybe they brought in the largest client the company has ever had, or maybe one of their parents owns the largest share of stock. Sometimes, we excuse them based on organizational norms (i.e., people can be excessively analytic), or policies that make it so difficult to fire someone that we live with such incompetence. You’d think that with all of the MBA programs and management education that exists today, we would have changed this dynamic by now. But sadly, empirical evidence suggests just the opposite — these programs often focus on analytics, and —  as I explain below — chase out the ability to be open to new ideas.

Even an effective leader or manager can become dissonant (i.e. lose touch with others, clients, the environment) over time. Usually, it’s because they’re too analytic. They focus on metrics, numbers, and analyzing problems. In doing so, they overemphasize a neural circuit called the “Task Positive Network (TPN),” which is useful for focusing, solving problems and making decisions. We know from neuroscience that , which is key to being open to new ideas, people, and moral issues. People with a suppressed DMN have trouble seeing others around them. Sometimes a boss is dissonant because he or she is a negative person, or egocentric, or just plain scared and defensive. None of this excuses their inappropriate behavior. But it does help us understand why they are suffering from a syndrome in which chronic stress or defensiveness has eroded their ability to renew themselves and be courteous, pleasant, and often much more effective.

So what do you do if you have a boss who’s fallen into this trap? First, recognize that these bosses are diminishing themselves and their ability to effectively lead others. They can deliver on known tasks — mostly routine tasks — but this style returns the least amount of innovation, the lowest levels of employee engagement, and often the lowest performance from teams.

Second, it’s key to talk to a boss like this. See if a frank conversation can help him or her move into what my colleagues and I called the Renewal Process. Ask him or her to envision a desired future over coffee, lunch, or dinner with questions like: “What could this organization be like in 10-15 years if everything were ideal?” You can do this by asking about the core purpose of the organization, or even its noble vision. “What is our purpose?” Not, “how are we doing?” but “why do we exist and how do we serve our organization and society?” Sometimes, you can get to the same place by asking about core values and virtues: “If we were being consistent with our values, how should we act with each other? with our customers/clients? our vendors? our community?”

From the point of view of neuroscience, all of this will arouse the Parasympathetic Nervous System (PNS) by activating the DMN, which is the state in which your body can rebuild itself and the only way to recover from stress. I know what you’re thinking: “I shouldn’t have to be my manager’s therapist.” True. But, you can be a valued friend or advisor, even to your boss.

Remember that your boss didn’t become a carrier of negativity overnight. Reversing it will take even longer. But, brief chats about positive topics might, to paraphrase from Star Wars, “Bring them to the light side of the force.” It is my experience that this approach will work 20-30% of the time. And when it does, you will have rebuilt a positive relationship with your boss and helped him or her become an effective leader once again.

If that doesn’t work, try the third option:  You may be able to get your boss some help. Find out if your boss has a coach or a trusted advisor. Who does your boss talk to when he or she wants advice or help? Talk to a thoughtful senior person in HR about coaching for your boss.

If nothing seems to be helping, then your fourth option is to protect yourself and your sanity. Upgrade and increase the frequency of positive renewal activities in your personal life and work day (i.e., meditation, yoga, exercise, prayer, helping others, playfulness, feeling hopeful about the future). Your job is to protect yourself, your people and your organizational unit. But, this can be exhausting and overwhelming. And while you might not see the consequences at work at first, your family may begin to feel them. And work could become just that — work — and not the fun and exciting challenge it used to be.

This leads to the final option — leaving! There comes a point where you need to protect your own creativity and spirit and find something else to do or somewhere else to do it. Because life is too short to waste it dealing with an out of touch boss.

Focus On: Conflict




Most Work Conflicts Aren’t Due to Personality
Conflict Strategies for Nice People
Senior Managers Won’t Always Get Along
When Your Boss Is Too Nice

Think Twice Before Eating Pretzels Directly Off Your Tray Table

In an experiment, E. coli bacteria survived and was highly transmittable for 72 hours after being dabbed on airline tray-table surfaces, according Kiril Vaglenov and James Barbaree of Auburn University. Their study, conducted on behalf of the U.S. Federal Aviation Administration, also found that the bacteria survived for 96 hours on armrests. The researchers obtained the tray-table and armrest material from a major airline, inoculated it with the bacteria and exposed it to typical airplane conditions.

Quantify How Much Time Your Company Wastes

Forty-four hours of meetings per week. Forty-six average attendees per meeting. Twenty-two hours of e-mail per week.

These numbers are not a dramatization; they are the actual year-long averages for a large technology company’s vice president. And at the managerial level, things don’t look much better: One IT manager, for example, spends 35 hours a week in meetings, sends emails during 85% of those meetings, and interfaces with an average of eight different teams each day.

There are so many initiatives, goals, people, customers, and vendors competing for our time that it’s extraordinarily challenging to just simply focus. While most would agree this overload negatively affects performance, it’s also something that’s notoriously difficult to measure. This is changing, however – just think about how many companies are utilizing sophisticated social intelligence algorithms to create a deeper understanding of their customers’ patterns and behavior. The next step is turning these analytics inward – harnessing the massive amount of e-mail, calendar, and messaging data a company already has – to diagnose surprising inefficiencies that exist at an organizational level.

Equipped with this information, companies can make decisions about how to better allocate what a recent HBR article (using VoloMetrix data) called their “scarcest resource:” time.

People analytics is not one-size-fits-all, as there are about as many ways to apply it as there are types of organizations themselves. But here are a few examples of how it’s helped managers better align their workforce with their business goals:

Identify expensive errors. A large IT organization we work with combed through its organizational time budget for a big systems integration project and found that a trivial requirement missed by a vendor cost $86,000 in its own peoples’ time to fix later on.
Monitor partner relationships. A new media company working with a partner company discovered it had over twice the number of their own employees working to support that relationship, at a cost of hundreds of thousands of dollars of their own peoples’ time.
Personalize feedback loops. To reduce organizational distractions and allow employees to better focus on priorities, a high tech company delivered personalized weekly reports to employees and managers. The reports were used for performance conversations to identify the issues and specific projects that were distracting people from the work that mattered most.

One fairly easy way to start analyzing your own company’s data is around what we call time fragmentation. This is based on the idea that making any real progress on thoughtful work requires more than a 30-minute increment of time, and that it takes 15 minutes to return to a productive state after an interruption. So when meetings and other workplace realities (such as email, hallway conversations, phone calls, bathroom and coffee breaks, etc.) are taken into account, a two-hour time block realistically equates to one-hour of productive work.

At one large software company, for example, we saw the average manager had only eight of these two-hour blocks of unfragmented time. That’s 16 hours available per week, which equates to about 8 useful hours. These same managers spent an average of 20 hours per week in meetings. After taking this into account, and assuming a 45-hour work week, managers were each left with nine lost hours per week because of fragmentation and too much context switching (45-16-20 = 9). That’s over 450 lost hours per year, per manager.

One solution could be a 20% reduction in meeting load through initiatives aimed at encouraging smaller, shorter and fewer meetings. We’ve found that a change like this can free up even more time for productive, unfragmented work than is saved on paper because people are less frequently interrupted.

While people analytics can be incredibly powerful for revealing patterns, I want to caution that it is not a panacea. In the end, effective management still requires the perspective of an experienced leader to ensure the data is viewed in context, taking into account factors like changing market conditions or the learning curve associated with a new initiative. In addition, companies that use people analytics should factor in a period of adoption, as people determine how they can best use the data and define the value of the analytics for their specific organization.

But by more closely tracking how you and your employees are spending your time, you may find new approaches to time management that go beyond individual attempts to work harder.

How One Law Firm Maintains Gender Balance

No area of the business world is more illogically gender imbalanced than law firms. Every year, top law firms recruit 60% female and 40% male law graduates into their practices. Within two years, their female majorities begin to leave. The percentage of female equity partners is now 17% in the top 100 US law firms.

The strangest part is that women lawyers aren’t leaving the profession. They are only leaving law firms, taking on corporate, government or regulatory roles instead.

Law firms who want to hold onto their female recruits can do so – but they need to behave differently. Gianmarco Monsellato, head of TAJ insists it’s only an issue of leadership.

His own firm is 50/ 50 gender balanced, at all levels – including equity partners and governance bodies. It’s fueled their success over the past decade, and TAJ is now the No. 5 law firm in France.

How did he do it? Dramatically differently than most law firms. Most of his competitors have spent years organizing women’s initiatives, networks, or mentoring programs that have done little to increase the percentage of women reaching the top. The National Association of Women Lawyers’ recent report is pretty clear: These “fix the women” approaches have not delivered.

Instead, Monsellato tackled the problem personally. He was involved in every promotion discussion. “For a long time,” he says, “I was the only one allocating cases.” He insisted on gender parity from the beginning. He personally ensured that the best assignments were evenly awarded between men and women. He tracked promotions and compensation to ensure parity. If there was a gap, he asked why. He put his best female lawyers on some of his toughest cases. When clients objected, he personally called them up and asked them to give the lawyer three months to prove herself. In every case, the client was quick to agree and managed to overcome the initial gender bias.

This kind of leadership on gender is rare, but spreading. A growing number of courageous male leaders are working very hard to balance their companies – because they ferociously believe it will enhance their businesses. I spend a lot of time with these kinds of leaders. The smartest among them know that gender balance is more about getting male leaders, and men in general, to push for balance than it is about getting women to change their own behavior.

Monsellato laughs at the ideas of “leaning in” and diversity programs. “If partners aren’t convinced, you won’t get anywhere. And diversity programs headed by women reporting to all-male boards will never work.” He never referred to his gender push as a diversity initiative, and he has never run diversity programs. “What I have done is promote people on performance. If someone works 50% of the time, we adjust that performance to its full-time equivalence. When you adjust performance on an FTE basis, maternity issues stop being an indicator.”

He knows just how hard his female lawyers work, and he doesn’t want to lose out on the benefits of their productivity and ideas. “My biggest issue is trying to stop women from working all the time,” he says, “as technology allows them to work anywhere, anytime.” It’s the “tone from the top” that is key, he insists. Speaking to a roomful of female lawyers at a recent conference, he reminded them, “You are not a minority. It’s about balance, not about gender diversity.”

Interestingly, in my experience, most of the leaders who’ve pushed hardest for gender balance are themselves not fully members of their companies’ dominant majority. They are often a different nationality than most of their colleagues, or the first non-home- country CEO. So, for example, the Peruvian-born Carlos Ghosn at Nissan in Japan, the Dutch Marijn Dekkers at BAYER (disclosure: they are a client) in Germany, or the Italian Monsellato at TAJ in France.

There is nothing better than being a bit of an outsider to understand the particular stickiness of the in-group’s hold on power. These are some of the more enlightened leaders on gender balance. They build true meritocracies, they get the best of 100% of the global talent pool – and they will win a huge competitive edge in this century of globalization.

Finding Your Superconsumers When It Isn’t Obvious Who They Are

In the March issue of HBR, some colleagues and I described a growth strategy of selling more to people we call “superconsumers.” In the article, most of the examples involve consumer packaged goods (CPG) companies; the central example involves Kraft’s Velveeta brand. The gist of the strategy is that instead of trying to convince new customers to buy their products, smart managers should find ways to get their best customers to buy even more.

Since the article appeared, my team has received a steady stream of questions about whether superconsumers can cut across product categories, and whether they can exist in big-ticket industries where consumers typically make just a single purchase.

The answers are Yes and Yes.

The trick is using broad data versus just big data, specifically looking across seemingly unrelated categories that are, in fact, related. Our research has found that superconsumers of one category tend to be superconsumers of nine other categories.

We’ve come to think of this as the superconsumer Rubik’s Cube — you solve for one side first, then find that the other sides fall into place. This works especially well for big-ticket items that, unlike Velveeta cheese, most people only buy once, because marketers can identify a superconsumer by observing their behavior in other categories.

We found an interesting link between two seemingly unrelated, big-ticket, long-purchase-cycle categories — insurance and standby power generators. Both are highly valued by the same consumers, those who are very proactive and value protection.

I asked one of our financial services partners, Alok Gupta, to help me with this.

Life insurance is not a topic most people want to think about, so superconsumers do not immediately come to mind. Alok noted that life insurers as a whole are shrinking. According to a McKinsey study, in 1985 life insurers represented 40% of the financial services industry in market capitalization. Today that figure is 25%.

Alok and I discovered that life insurance superconsumers do exist. They are the top 10% of the market, and they buy five times more death benefit coverage and have three times more accumulated cash value than the typical life insurance customer.

One might be tempted to say that these are just high-income consumers. But not all high-income consumers are motivated in the same way. In fact, the same analysis of high-income consumers shows that they only have 1.3 times more death benefit and 0.7 times the accumulated cash value as the typical life insurance consumer. And these superconsumers are emotionally engaged in insurance—proactively shopping for insurance, and looking forward to phone calls from their agent

The real question is how do you find them?

It turns out that these are superconsumers of insurance in general. They spend 40% more in annual premiums across all forms of insurance (e.g., auto, home, personal liability, long term care). The challenge is that many insurance companies have access to this data, so no one company has a distinct advantage.

Strange as it may sound, one of the best things an insurance agent can do is to look for consumers with standby generators. Generac is the leading standby generator company. These gas-powered devices provide power when the electrical grid shuts down, usually in extreme weather. The challenge of selling standby generators is that disaster is equally unpleasant to talk about as death. Beyond that, while every consumer has a vague idea of what life insurance is, few people have ever heard of a standby generator.

The CEO of Generac, Aaron Jagfeld, noted that while their growth was strong, it’s historically been reliant on “reactive” consumers — generally people who’ve suffered during a major blackout. We found that the ideal consumer for Generac was a superconsumer of proactive protection, who was willing to learn about and make a large purchase without previously experiencing an extreme event.

This behavior spills out into many aspects of these consumers’ lives. Not only do they have more insurance, but they often have three or more refrigerators and freezers because they enjoy cooking and freezing food for the future—a form of planning ahead. We also found that for them, buying a standby generator was a deeply emotional purchase, not a rational one. When asked to draw a generator, they drew super heroes with bulging muscles, capes flying in the wind, standing on top of buildings. They said buying a generator made them feel like the best providers and protectors of their families. One consumer said, “I actually look forward to when the power goes out. I imagine myself standing in my driveway at night looking at the sea of darkness, with my house as the only bright beacon on the hill. As a result, my family and everyone else knows that I am the man.”

Generac took the broader insight about proactive protection superconsumers and improved their marketing strategy. This has helped their business double in the last few years.

The takeaway: When looking for superconsumers, don’t restrict yourself to considering your own best customers. Often, somewhere in the data, there’s a hidden correlation between the people who’d love to buy your product and people who are already deeply engaged with a seemingly unrelated product, all stitched together under a singular and powerful emotional benefit.

Dealing With Investors the Sam Palmisano Way

Last fall, when it was still not clear who would be the next chief executive of Microsoft, Jack Welch recommended Sam Palmisano for the job.

The two were sitting on stage at Radio City Music Hall chatting about business-y stuff when the retired GE CEO made the suggestion, and I was a little surprised when the retired IBM CEO didn’t dismiss it out of hand.

I’d be interested, Palmisano replied, but only “if Bill took the company private.”

Bill Gates did not choose to take Microsoft private (it would have cost a lot), and insider Satya Nadella became the company’s new CEO. But I tucked Palmisano’s remark away, and when we started putting together a package of articles for the June HBR on American corporations’ relationship with Wall Street, I thought I’d ask Palmisano about it. What was so horrible about publicly traded companies that he’d consider being a CEO again, but only if he could avoid public markets? Are today’s investors really that horrible?

Short answer: no. Palmisano’s main complaint with public companies, he said when I asked, had to do with “the regulatory environment and the role that’s being defined for the board.” Basically, he thinks public-company boards are being forced to spend too much time on compliance and control, which crowds out more important topics like strategic investment and growth. But investors — he didn’t have a problem with them at all.

They do, however, have to be managed intelligently. Palmisano and his executive team struggled with that during his first few years as CEO, but eventually came up with the approach that he discusses at length both in the Q&A published in the latest HBR and in this brand-new Ideacast podcast (we covered some similar ground in the two interviews, but they were entirely separate conversations, so if you’re a glutton for this stuff, you should consume both):

Download this podcast

The abridged version is that Palmisano and then-CFO Mark Loughridge came up with what they called the “investor model” or the “road map” — a strategic plan complete with multi-year goals for investment, revenue growth, and earnings growth that they asked investors to judge them by.  (Here’s a version of it from a couple of years into the process, which started in 2006.) The idea was to avoid the distracting dance around quarterly earnings and quarterly earnings forecasts, but at the same time tell investors more than just “trust us.”

At first investors didn’t trust them, but as IBM began meeting and surpassing the targets it set for itself, and Palmisano began inviting the company’s biggest shareholders in for day-long discussions of the company’s strategy, criticism of his leadership faded and the company’s stock began a long upswing. He succeeded in charming Wall Street … without ever deigning to participate in one of his company’s quarterly earnings conference calls or talking up its prospects on CNBC.

Obviously, if IBM hadn’t met the targets Palmisano and Loughridge set, it would have been a different story.  And there are indications now that Palmisano’s strategic plan and its focus on earnings-per-share gains may have eventually become counterproductive. In the cover story of the latest Bloomberg Businessweek, Nick Summers reports that many IBMers now refer to what is officially called Roadmap 2015 as “Roadkill 2015.”

But in dealing with the investment community, Palmisano’s approach still seems like the only productive one for the CEO of a publicly traded company to take. Don’t respond to Wall Street, in the sense of paying attention to the day-to-day or even month-to-month movements of the share price or the things that sell-side analysts ask on earnings calls or business-channel anchors ask on TV. Instead, come up with a strategy, communicate it clearly to investors and give them transparent ways to judge whether you’re succeeding or not. Last year I wrote about how Amazon’s Jeff Bezos had succeeded in part by approaching Wall Street with the attitude of a good dog trainer. That’s an extreme case, and in some ways so is Palmisano’s: CEOs of companies with lower profiles than IBM’s sometimes probably do have reason to join in on conference calls and make the voyage to Englewood Cliffs. But they need to figure out what to tune out — and learn to manage Wall Street rather than being managed by it.