Marina Gorbis's Blog, page 1423

The Case for the 5-Second Interactive

Watching a “cold read” of a data visualization is revelatory. Try this: Hand some friends a printout of an infographic and ask what they think. Then, watch them. People’s eyes will dart, their jaws will clench. Sometimes they will move the paper around, as if meaning will emerge at just the right angle. Loose bits of internal dialogue sneak out: OK, what does that bar — right, got it. For some, defiance takes over if meaning eludes them: What am I looking at? Why is it green? I don’t get it. One colleague of mine grabs the paper — possessing it seems to be part of making sense of it — and then takes a deep breath, seemingly preparing for a mental fight.

I have no doubt about the value of data visualization. We don’t need to belabor the fact that visual information rules and that dataviz literacy will be as fundamental a business skill in the future as spreadsheet literacy is today. But this problem with the cold read bothers me. Even reasonably simple visuals seem to spark confusion, and that’s a problem if the goal is to improve understanding and be persuasive with data. I’ve begun actively trying to build graphics that reclaim that mental energy lost to parsing a graphic for what it could be better spent on: actually analyzing data and forming ideas based on it.

This was the first prototype for beating the cold read problem:

You might be asking, That’s it? The entire experience requires three clicks and about five seconds. It generates a stacked bar chart. All I’ve done is deconstruct a chart into three simpler ones, then allowed the user to put it back together at his or her own pace. Nothing’s particularly clever here; the idea behind it is simple: if cold reads of visual information are difficult because users have to make decisions about where to focus, then if you remove as many of those decisions as possible, users will require less cognitive work to comprehend the information. I’m betting the five seconds it takes to get through the graphic more than makes up for the amount of work the user would have done parsing a static image that presented all the data at once.

Of course, it’s a dilettante’s hypothesis. I’m no scientist, but I did ask the folks at the Harvard Vision Sciences Lab to weigh in on the idea. The team there said that studies that looked specifically at how our brains process infographics as a whole were limited; most of the research is far more (mind-numbingly more) specific than that — but some themes in the research do seem to support an approach that simplifies visuals, and removes choices for our brains.

Good enough for me. And my method, while not scientific, wasn’t haphazard either. I followed these four basic principles when building this five-second interactive:

Eliminate data whenever possible. This is borrowed from Braess’ Paradox. The actual theory applies to how adding route options in traffic systems reduces overall performance. My simple version is: The more data points you present, the harder you make it for users to decide where to focus and how to proceed.
Explain the data as simply and explicitly as possible. That’s just good editing
Use animation to inform, not decorate. Movement on a screen should help the user make sense of the information, otherwise minimize or eliminate it
Tell a story. I was inspired here by John McPhee, a master storyteller who often employs what I’d call “micronarratives” — a few sentences within an essay that tell a story, often to explain something complex. One such McPhee micronarrative, for example, explained how a log burns; another explained why there’s gold in mountains. Point is, humans like narrative; it helps us engage and deal with complexity, even if the narrative is as small as the one above.

Here’s how those principles were applied in the above chart on Football v. Rugby: The opening scene eliminates more than half of all of the information contained in the source dataset. Data are explained and labeled unambiguously: Ask a question (How long are games?), get an answer (60 minutes and 80 minutes).

Next we add five new pieces of information, but crucially we also remove three — the previous subhed and labels. This lets the user (OK, forces the user to) focus on the most important information: the new data. The animation to expand the new bars over the originals isn’t a design flourish; it’s functional. It explains the relationship between data points. The second bar (how much action occurs) literally fills up part of the first one; it’s a subset. State three repeats this same melody, and the narrative concludes with the full reveal of all of the data. By that point, hopefully, no parsing is necessary. We already get it, and we can spend our time thinking about the meaning rather than trying to figure out the meaning.

We’ve tried this approach at HBR here, and here. I hope it can become a format that’s as natural a component of digital content as static infographics are to print. But I don’t think it’s right for every dataviz. Sometimes, complexity is the point, and some would argue there’s value, even joy, in spending time with complex visuals and discovering as we go. Sometimes we don’t know the answers the data are providing, so we want to spend time coming up with multiple possible interpretations rather than being told what the narrative is. Datasets that allow for user-chosen variables to define the visualization probably won’t work in this model, either.

But for the countless good examples of “here’s the point” data visualizations that stream through Twitter and get social love on the Internet every day, it could be a valuable tool that increases the effectiveness of the visualization by beating the cold read.

Persuading with Data

An HBR Insight Center




Generating Data on What Customers Really Want
10 Kinds of Stories to Tell with Data
Visualizing Zero: How to Show Something with Nothing
Data Alone Won’t Get You a Standing Ovation

3 Myths That Kill Strategic Planning

In its simplest form, strategic thinking is about deciding on which opportunities to focus your time, people, and money, and which opportunities to starve.  One of history’s greatest strategic thinkers, Napoleon Bonaparte summed it up this way: “In order to concentrate superior strength in one place, economy of force must be exercised in other places.” If dead, despotic French emperors are not really your style, Michael Porter said it like this: “The essence of strategy is choosing what not to do.”

At the highest level, this usually means deciding to sell off one company in order to buy another one. More often it simply means deciding to move some initiatives to the back burner in order to concentrate the bulk of your resources in a single key area.

Sounds simple enough. Yet, three pervasive myths continue to make strategic thinking an elusive skill set in today’s organizations.

Myth 1: Productivity is the goal.

Productivity is about getting things done. Strategic thinking is about getting the right things done well. The corollary of that truth is that strategy requires leaving some things undone, which stirs up a potent cocktail of unpleasant emotions. When you leave projects undone or only half-completed, you must sacrifice that feeling of confidence and control that comes from pursuing a concrete goal (PDF). You will have to fight through the universal psychological phenomenon of loss aversion that results from saying goodbye to a cherished project in which you have already poured heaps of time and money. You will also have to deal with the social pain and feelings of rejection that come from telling some people on your team that their big idea or entire functional area has been demoted in favor of something else more valuable.

In the face of all that unpleasantness, it is tempting to continue striving for productivity. After all, what’s wrong with being productive?

The problem is that productivity is strategically agnostic. Producing volume is not the same as pursuing excellence. Without a strategy, productivity is meaningless. As Peter Drucker famously said: “There is nothing quite so useless as doing efficiently that which should not be done at all.” So the next challenge is figuring out which things are the right things.

Myth 2: The leader’s job is to identify what’s “important.”

Here’s a quick exercise: Make a list of every project and initiative your team is working on right now. When you finish the list, draw a line through all of the things that are not important.

If you’re like 99% of teams, not one project on your list will get crossed out. That’s because every project your team is working on is “important” to someone somewhere somehow. They all “add value” in some vague way. That’s why debating about what’s important is futile. Strategic thinkers must decide where to focus, not merely what’s “important.” Strategic leaders must consciously table some “important” projects or ignore some “important” opportunities.

While productive teams log overtime hours in order to knock out one important project after another on a first come, first serve basis, strategic teams decide which projects will contribute most to the declared strategy of the organization, and put the rest of the “important” projects on hold.

Myth 3: Strategic thinking is only about thinking.

Strategic leadership is not a math problem or a thought experiment. Ultimately, strategic thoughts must yield strategic action. Thorough cost/benefit analyses replete with mesmerizing forecasts, tantalizing linear trends, and 63-tab spreadsheets beautiful enough to make a newly minted MBA weep with joy are utterly useless without an actionable decision. In spite of the uncertainty, complexity, and the ever-present possibility of failure, a strategic leader must eventually step up and make the call about what the team will and will NOT focus on.

Tipping his bicorne cap to this truth, Napoleon once said, “Nothing is more difficult, and therefore more precious, than to be able to decide.” Perhaps that’s also why this precious ability to decide is the defining feature of those deemed worthy to hold the highest leadership positions.

Make Your Team Feel Powerful

Research has shown that helping others feel more powerful can boost productivity, improve performance, and leave employees feeling more satisfied on the job. A study conducted by Yona Kifer of Tel Aviv University and published in Psychological Science found that employees were 26% more satisfied in their roles when they had positions of power.

Feelings of power also translated to more authenticity and feelings of well-being, the researchers found. Power made the subjects feel more “true to themselves,” enabling them to engage in actions that authentically reflected values they hold dear. This subjective sense of authenticity in turn created a higher sense of wellbeing and happiness.

And yet Gallup research has found that an astonishing 70% of American workers aren’t engaged or committed to their employers. Gallup estimates the cost of their apathy at between $450 billion to $550 billion in lost productivity per year. I’m guessing those workers aren’t feeling all that powerful.

While it would be great to think we could just repeat a mantra each morning to facilitate these wellbeing-enhancing feelings of power, another global study conducted by Gallup found that among some 600,000 workers across several industries, leadership support, recognition, constant communication, and trust were essential to creating a thriving environment where front-line employees felt they had the autonomy to make a real difference in the organization. In other words, to instill a sense of power in people for sustained engagement you need the support of the entire system.

In contrast, overly structured management-driven empowerment programs that are coupled with continuous improvement initiatives don’t work, according to researchers from the University of Illinois, as employees tend to feel such programs are often forced upon them without their input on the initiatives’ usefulness.

Instead, the researchers found that even the least powerful employees will commit to finding ways to make their organization more efficient if given the autonomy to make decisions and execute the improvement measures they find most useful. Managers are advised to act more as coaches, giving direction and support, and trusting that frontline employees, who are the experts on the ground, know better which improvements ultimately work in the best interest of the organization. The study, by Gopesh Anand, Dilip Chhajed, and Luis Delfin, shows that employees will be most committed to the organization when they feel their day-to-day work environment is autonomous and when they trust leaders to have their back. These feelings of power and the reciprocal trust in leadership in turn lead to proactive behaviors by frontline employees, as they’re likely to take charge in continuously seeking ways to improve their day-to-day work practices that lead to organizational efficiency.

While a company-wide effort of making employees feel autonomous and trusted yields the greatest benefit in employee commitment, managers can start with their own team members. Encouraging others to share their unvarnished views on important issues, delegating and sharing leadership, assigning managerial tasks, communicating frequently, and allowing for mistakes to serve as learning opportunities can all empower employees and develop them into independent thinkers who aren’t afraid to take risks and actively contribute in moving the organization forward.

It isn’t necessary, or indeed possible, to elevate every member of staff to a leadership position. But a good manager can offer choices that lead to empowerment, no title required. While we know that people instinctively crave higher status, M. Ena Inesi of London Business School discovered that agency is just as important. She primed study participants to feel either powerful or powerless. They then had to choose whether to shop at a nearby store with fewer options, or a store that was further away but which offered considerably more options. When participants felt powerless, they craved more choices. The participants who felt powerful, however, were content to have fewer choices. “You can imagine a person at an organization who’s in a low-level job,” Inesi said at the time.“You can make that seemingly powerless person feel better about their job and their duties by giving them some choice, in the way they do the work or what project they work on.”

People need to believe they have a sense of control over their situation, particularly in times of change and uncertainty, or they may adopt what psychologist Martin Seligman at the University of Pennsylvania termed “learned helplessness,” where they basically stop trying. In a similar vein, Harvard psychology professor Ellen Langer conducted research on mindfulness and ‘choice’ and found that giving people choices over their environment actually extended life by years, according to her studies conducted among the elderly in nursing homes.

Tom Peters once said, “Leaders don’t create followers; they create more leaders.” Giving your employees real autonomy and helping them feel more powerful is not only your best chance to buck the trend of disengagement and apathy; it is at the heart of competitive strategy.

The Art of Saying a Professional Goodbye

Saying “goodbye” is one of those activities that seems so simple it hardly requires advance thought — and so endings creep up on us and catch us unprepared. We tend to default to our habitual responses whether or not they’ve been effective in the past. As a result we often miss opportunities to enjoy truly meaningful endings — instead they’re rushed and poorly planned — or we skip over them entirely, casting the old aside as we race toward the new.

But at certain times of the year, such as the graduation season that’s about to begin, we’re compelled to give more thought than usual to endings. And in our work lives, we’re saying goodbye with increasing frequency as well, as more work is conducted in ad hoc teams that assemble for a single project and then dissolve.

As an executive coach I’m constantly in the process of beginning and ending relationships. In my private practice I typically see clients for a period of months, rarely for longer than a year, and in my work with MBA students at Stanford I meet an entirely new group of people every 10 weeks. Between the two there’s a steady stream of hellos and goodbyes in my life. (Because of my academic calendar, the beginning of March is particularly intense in this regard — every year at that time I typically end nearly 20 groups and coaching relationships in a span of 10 days.) It can be draining, but I’ve learned how to manage the process to make it meaningful without being overwhelming. Here are five principles that work for me:

1. Understand your needs. We all have different needs when it comes to ending relationships, influenced by our formative experiences, cultural background, and professional training, and it’s important to understand not only the needs of the other people in the relationship, but also our personal needs. That understanding is essential to crafting an ending that works well for all parties, of course, but it’s also a critical step in determining whether our own needs and preferences are helpful or should be modified in some way. I once rushed past endings, sometimes to avoid the strong emotions they evoked and sometimes simply because I was eager to move on to the next thing. But that could put me out of step with the people around me, and it’s been valuable to challenge my preferences and be more flexible about them to ensure that the experience is fulfilling for others.

2. Mark the occasion. Some kind of formal denotation is essential to an ending, even if it’s simply saying, “Well, this is it.” The absence of a denoted ending leaves a sense of uncertainty that can be highly problematic: Are we really saying goodbye? Just what does this transition signify? What will happen on the other side? The difficult emotions stirred up by endings can make us reluctant to formally mark the occasion, but that’s precisely why we should. Rituals, even simple ones, are important ways to acknowledge and deal with these emotions. I’m not suggesting that we need to mark every ending with a complex ceremonial procedure; that’s not appropriate for every group or relationship. But do something.

3. Share the work. Endings work best when everyone involved has a feeling of ownership and agency in the experience. If at all possible, the people participating should have a degree of choice in the nature, timing, and duration of the activities. This doesn’t necessarily require a collective decision-making process or a unified consensus. Sometimes, that’s simply infeasible. But particularly when we’re in a leadership position or another differentiated role we can feel that it’s our individual obligation to orchestrate the ending. With the best of intentions we can take over the process in a way that leaves others feeling disregarded. We’re probably thinking more about the ending than are the others — and thinking about it sooner than they are — and we may well have a unique perspective that should inform the ending. But the more everyone involved feels a collective sense of responsibility for the experience, the more successful it will be. So if we need to make independent decisions as leaders about the nature of the ending, it’s important that the ending we choose provides the other parties with opportunities to be active participants rather than passive observers.

4. Manage the emotion. Endings are — and should be — emotional experiences. The ability to express and share the emotions that are stirred up by an ending help ensure that an actual ending occurs. In the absence of overt expressions of emotion, we can feel that something important was left unsaid, contributing to a lack of closure and heightening feelings of loss or regret. But again, it’s critical to recognize our differences in this regard. Some people are going to feel more emotional than others, and it’s important to make room for a range of expression. If people feel teary, it should be OK for them to cry — and if people don’t feel teary, it should be OK for them not to cry. Emotion management is a critical function of rituals; by design they heighten our feelings and legitimize a fuller range of emotional responses, while also putting some useful boundaries in place that help us contain those emotions, conclude the experience, and move on.

5. Accept — and prepare for — the letdown. Even when we handle an ending perfectly, it’s common, and healthy, to feel a sense of depletion when it’s truly over. Our reluctance to acknowledge endings can stem from our resistance to these feelings. William Bridges, in his great book Transitions, said that all our endings and beginnings are joined by an “empty or fallow time in between,” and that this “neutral zone provides access to an angle of vision on life that one can get nowhere else. And it is a succession of such views over a lifetime that produces wisdom.” When we rush through this period to avoid the letdown we typically feel after a meaningful ending, we cheat ourselves of this wisdom. We’re better served when we accept the letdown, although this doesn’t mean allowing ourselves to become overwhelmed by it. Instead, recognize that it’s coming and prepare for it. We may need to spend some time alone after an ending, or we may need to connect with other people. We may need some open time on our calendar to look back and reflect, or we may need to keep busy and stay active. There’s no predetermined recipe; the key is simply being thoughtful and intentional about what will allow us to access the wisdom that can be found there, while we make ready to move forward again.

So what does this all mean in practice? Here are some techniques to use under different circumstances.

To end a group experience that has been particularly memorable or emotional:

Gather the group in a quiet place where you won’t be interrupted. Ensure that you have roughly 1-2 minutes per group member for the ritual.
If at all possible, sit in a circle, not around a table. Be deliberate about forming an actual circle and have everyone move a little closer to the center; physical proximity matters.
Put a pile of small objects in the center of the circle, one object for each member. The objects should seem noteworthy in some way, but they need not be costly; I typically use small, polished stones used in flower arranging that sell for $1 a bag.
Tell people that when they feel like speaking they should step to the center, grab an object, return to their seat, and briefly say whatever they need to say to conclude the group. The object is theirs to keep as a reminder of the experience.
Emphasize that everyone will speak, however briefly, and you won’t proceed around the circle but rather each person will speak up when they’re ready.
If you’re a leader or authority figure in the group, don’t go first or last; find an opportunity to participate in the middle.

You can modify this exercise to fit the needs of the group or the occasion. For example, at the end of a one-day workshop I might omit the pile of objects, because it can seem too formal for the event. Or if it’s a group in which some people may be reluctant to speak, I’ll ask the participants to go in order around the circle, which creates just enough social pressure to encourage participation without leading to a sense of overwhelm.

Another ritual that works well in groups in which the members have become close is to ask each member to come up with a question for every other member and to bring each question printed out or written on a separate sheet of paper. (I recently did this with some groups of MBA students at Stanford I’d worked with for six months, and the terrific questions I received ranged from “What makes you good at your job?” to “What’s next?”) The exercise consists of distributing the questions to each member, allowing a few minutes for silent reflection, and then having every member speak to the group in turn. Some people will answer a specific question, some will share themes that emerged in the set of questions they received, and some will simply speak about their experiences in the group.

In concluding one-on-one relationships I find that there’s less of a need for formal rituals because it’s typically easier for two people to talk freely about our thoughts and feelings during an ending than it is when we’re in a group setting. That said, it’s still essential to designate the final conversation as such in order for both parties to prepare and to acknowledge the transition.

If you’re concluding a one-on-one relationship as a leader, I recommend sending the other person some questions to reflect on before your final conversation. This will help them clarify what they’re taking away from their work with you and will generate valuable feedback that you might otherwise miss out on. Here are some suggestions:

What’s been most helpful to you about our work together? How has my style as a leader contributed to these aspects of the process?
Are there any ways in which our work together could have been more useful to you? Are there any ways in which my style as a leader was unhelpful for you?
To be as effective as possible with others I lead in the future, what should I continue to do? What should I do differently?

The first few times you try any of these techniques you may feel awkward, but our reflexive aversion to feelings of awkwardness is one of the forces that causes us to fail to mark endings in the first place. In my coaching practice and in my work with MBA students I regularly encourage people to increase their “comfort with discomfort” as a means of better managing difficult situations, and here I encourage you to persist and not allow feelings of awkwardness to dissuade you from acknowledging important endings. With a modest amount of effort and forethought, we can develop the same facility with saying goodbye deliberately that we have for other meaningful transitions in our lives.

Yes, You Can Have a Million-Dollar Business with No Employees

Census figures show that the number of one-person businesses in the U.S. with revenues between $1 million and $2.99 million rose 10% year-over-year in 2012 to more than 29,000 firms, Forbes reports. Most are professional, scientific, and technical-services companies, but retail and construction firms are well represented too. Still, such companies are rare: Firms with sales over $1 million make up far less than 1% of the nation’s 22.7 million nonemployer companies, for which the largest revenue category is $10,000 to $25,000.

Marketing Can No Longer Rely on the Funnel

One of the central concepts of marketing and sales is the funnel — through which companies are supposed to systematically move prospects from awareness through consideration to purchase.

But consumers are now more informed, connected, and empowered than ever. Does the funnel still work in a digital, social, mobile age?

We asked some of the leading marketers in the world — from companies like Google, Intuit, Sephora, SAP, Twitter, and Visa — to assess the relevance of the marketing funnel.  What we found says as much about the future of business as it does about the future of marketing.

According to these marketers, the primary problem with the funnel is that the buying process is no longer linear. Prospects don’t just enter at the top of the funnel; instead, they come in at any stage. Furthermore, they often jump stages, stay in a stage indefinitely, or move back and forth between them.

For example, consider items that come recommended on an e-commerce site. With a click you can add them to your cart, moving straight from awareness through consideration to purchase in only a few seconds. The same holds true on items discovered in a Tweet, Facebook post, or Pinterest board.

In both B2B and B2C businesses, customers are doing their own research both online and with their colleagues and friends. Prospects are walking themselves through the funnel, then walking in the door ready to buy.

As an example, Julie Bornstein, CMO at Sephora, has seen social media change how people buy beauty products. Recommendations from friends have always been important, but now these recommendations spread “quicker, faster, and further” at every stage in the funnel. The decision on what to buy increasingly comes from advocates who share their experience in a way that pulls in new customers and informs their purchase decision. Sephora’s response has been to bring all the stages of the funnel together into a single place, creating its own online community where people can ask questions of experts and each other about brands, products, and techniques.

One popular alternative to the funnel is the Customer Decision Journey popularized by McKinsey. A key advantage of this model is that it’s circular, rather than linear. Prospects don’t come in the top and out the bottom, but move through an ongoing set of touchpoints before, during, and after a purchase.

The Customer Decision Journey is an improvement over the traditional funnel, but some marketers see it as incomplete. The problem is in the name itself. Brands may put the decision at the center of the journey, but customers don’t. Jonathan Becher, CMO at SAP, believes that for customers, “the pivot is the experience, not the purchase.” The Customer Decision Journey might be circular, but if the focus is still on the transaction, it is just a funnel eating its own tail.

One of the most critical weaknesses of the Customer Decision Journey is the connection between purchase and advocacy. Almost every marketer we spoke to described how social media has disconnected advocacy from purchase. “You no longer have to be a customer to be an advocate. The new social currency is sharing what’s cool in the moment,” says Joel Lunenfeld, VP of Global Brand Marketing at Twitter.

In today’s marketing landscape, people can experience a brand in many ways other than purchase and usage of a product. These include live events, content marketing, social media, and word-of-mouth. Consider all the members of the Nike+ running community who don’t own Nike products or the half million fans of Tesla’s Facebook page who don’t own a Tesla. Or consider companies where employees use their own devices or download their own software until IT purchases the enterprise version for the entire company. In today’s digital age, advocates aren’t necessarily customers. Marketers who think that advocacy comes after purchase are missing the new world of social influence.

Antonio Lucio, Chief Brand Officer at Visa, believes the solution is to shift the focus from the transaction to the relationship.  After exploring the Customer Decision Journey, his team developed what they call a Customer Engagement Journey.  In this model, transactions occur in the context of the relationship rather relationships in the context of the transaction.

As an example, consider a real world journey of a family’s trip from the U.S. to Mexico. Visa has mapped out the entire experience, from where the family gets ideas on where to go (TripAdvisor), to how they gather input from friends (Facebook), to how they pay for their cab (cash from an ATM) or hotel (credit card), to how they share photos of their trip with friends back home (Instagram). Only a few of these situations are opportunities for transactions, but they are all opportunities for relationship. “When you change from decision to engagement,” Antonio says, “you change the entire model.”

Market trends suggest the mismatch will only widen between customers’ actual experiences and the models of the funnel or Customer Decision Journey.  One key trend is the integration of marketing into the product itself.  The funnel presumes that marketing is separate from the product.  But for digital products like games, entertainment, and software-as-a-service, the marketing is built right into the product.  Examples include the iTunes store and Salesforce’s App Exchange.

Caroline Donahue, CMO at Intuit, oversees numerous web-based products for which “the product and the marketing become one thing.”  The funnel changes because “with cross-sell and up-sell, you move from awareness to action instantaneously.” Instead of a Customer Decision Journey, her approach might best be described as a User Experience Journey into which opportunities for transactions are thoughtfully embedded.

Google shares a similar view, taking the fusion of product and marketing one step further. Arjan Dijk, the company’s Vice President for Global Small Business Marketing, believes products should be designed to market themselves. For Google, the question is not “how can we market this product?” but “which products deserve marketing?” Marketing isn’t about “pushing people’s thoughts and actions. It’s about amplification, helping what’s already happening grow faster.”

So where do we go from here?  The funnel and Customer Decision Journey aren’t going away.  They are useful models, and will continue to be helpful in certain contexts.  But marketing today requires a new mental map to navigate a changing landscape. We need a model that informs marketers how to enable and empower, not just persuade and promote.  There are a variety of alternatives including journey, orbit, relationship, and experience.

Whatever model you choose, what’s most important is that it addresses: first, the multi-dimensional nature of social influence; second, non-linear paths to purchase; third, the role of advocates who aren’t customers; and fourth, the shift to ongoing relationships beyond individual transactions.

A Social Brain Is a Smarter Brain

It is well established that brain games and puzzles act as calisthenics for our brains, expanding their capacity and improving their overall health. More surprising are the findings of a study led by researchers at the University of Michigan. It shows that just as effective in building cognitive strength are social interactions.

The design of the study was simple – the researchers took one group of participants, randomly paired people up, and instructed them to get to know each other by asking probing questions. After ten minutes of such interaction, the participants were given a battery of cognitive tests. In parallel, participants in a second group were given challenging brain-game activities to perform, also for ten minutes, and followed by the same cognitive tests. A third group served as the control and took the tests with no prelude. The result? The social interaction group outperformed the control group on the cognitive tests, and did not differ from the brain games group. For the researchers, this suggests that the active perspective-taking one does in conversation involves mental gymnastics as demanding as any brain-teaser.

I find it fascinating that a good way to keep your brain “oiled” is simply to spend time talking with people. I’m also happy to note that this makes the case for open innovation even stronger.

Open innovation projects (where organizations facing tricky problems invite outsiders to take a crack at solving them) always present cognitive challenges, of course. But they also force new, boundary-spanning human interactions and fresh perspective-taking. They require people to reach out to other people, and thus foster social interaction.

Two other recent studies underscore how deeply social an activity open innovation is.  The first, from Newcastle Business School in the UK, looks directly at knowledge exchange between higher education institutions and industry (a typical exchange in open innovation challenges) and concludes that its success depends upon the social processes that facilitate the collaboration. The second, from the University of Lapland in Finland, explores what executives who sponsor open innovation challenges value most about them, and finds that the broader benefits of the multidisciplinary social interaction outweigh the concrete results of getting specific solutions.

In my experience, the “solvers” of challenges also recognize the value of open innovation as social exercise. Take one of the teams that recently responded to the GE/NFL Head Health Open Innovation Challenge, which NineSigma managed. GE and the NFL were looking for fresh approaches to diagnosing concussions, and someone at The University of Akron saw a connection to “neuromarketing” work being done by the school’s Suarez Applied Marketing Research Laboratories. But they recognized they would also need to address other angles, so they assembled a team drawing on the University’s Department of Sport Science and Wellness Education, its Statistics Department, Akron Children’s Hospital, and NE Ohio Medical University. These groups had never before worked together on a common solution, or even imagined that their research could be combined into a larger solution.

As it happens, the solution they proposed didn’t win the challenge. But the University of Michigan research suggests the team members themselves got smarter in the process. Maybe that’s why they are eager to maintain the connection, and have collaborated in other ways since.  And I would go a step further and posit that GE and the NFL built their brainpower, too – not just because they got a smart solution to their challenge but because they expanded their networks. Every time we run a technology search for an organization, proposals pour in from world-class solution providers – usually more than a dozen, and often many times that amount. When our clients reach out to these submitters, they make new connections that sharpen their thinking – even more so if the interaction persists after the immediate search is concluded.

On this point, I can’t help recalling yet another interesting study, published in Nature Neuroscience in 2011. It demonstrated a positive correlation between the size of the amygdala – a part of the human brain that performs a primary role in the processing of memory and emotional reactions – and the size and complexity of a person’s social network. In other words: Bigger brain, greater social interactions. It’s a correlation, and the first assumption people make is that the larger amygdala supports greater emotional intelligence and better memory, allowing the individual’s social network to expand. But perhaps the causality also goes the other way, and interacting widely with others – as companies do when they use open innovation – grows the capacity of brains.

The Commencement Speech Parents Need to Hear

For graduating seniors, spring marks the season of advice as predictable as the flip-flops under their caps and gowns. Throughout the May and June rituals of Class Day celebrations and graduation ceremonies, successful members of older generations will urge this year’s crop of Millennials to pursue their dreams and, by extension, travel the same path they did. But most of their young audience already knows better. They know they face an uphill climb on their path to economic independence and the markers of full adulthood.

The upbeat entreaties of this year’s commencement speakers will likely not mention the graduates’ extraordinarily high student debt load that, in the last year alone, has grown by 10%. Nor are they likely to reference data showing that recent graduates aren’t earning enough to pay off their loans and face an estimated 12% unemployment rate.

Over the past several years, I have surveyed more than a thousand Millennials as well as researched thousands of articles, books, and studies about this young generation for my book, You Raised Us – Now Work With Us. Through it all, I have been most struck by the fact that, even if the graduates are lucky enough to find a job, they are entering a workplace where senior generations have already formed a negative opinion of their commitment, work ethic, and tendency to ask questions and seek feedback.

For Millennials to move past these stereotypes and succeed in the workplace, perhaps it is time to change the patterns of the season, and have the senior generations be on the receiving end of the advice. After all, Millennials have been urged to speak up throughout their lives, but never has it been so important for other generations to listen. Before the 2014 graduates embark on their collective journey into workplaces still struggling to adapt to changing demographics, senior generations would benefit by heeding advice from the Millennials’ perspective.

For Millennials, such a speech would be directed primarily to one particular group in the audience: the parents who raised them at home but cannot understand them at work. And that speech would likely go something like this:

Parents, as you come here to celebrate your child’s graduation milestone, remember that the young person whose accomplishments you celebrate will soon be in the workplace – which also means that the Millennials raised by those who surround you will be in yours. Remember that each time you form a stereotype or paint the entire generation with an unnecessarily broad brush. And in that spirit, consider these six principles as guidance in your interactions with young people at work.

First, think of each new hire as a future leader. As 10,000 Boomers turn 65 each day, and with too few members of Gen X available to replace them, Millennials will be taking on increasing responsibilities at younger ages. Do not expect this exceptionally large, diverse, and educated young generation to walk into your workplace and assimilate. To retain Millennials and develop their leadership potential, set aside preconceived notions and, instead, pay attention to what truly will motivate young employees.

Second, recognize that the “entitled” label you tend to attach to Millennials is not entitlement at all, but rather the self-confidence and self-respect that you have instilled in them since birth. You raised your children to believe in themselves and to believe in their future success. They will need this self-confidence now more than ever, since the economy serves as a sobering backdrop to their positive expectations. Embrace this generations’ confidence as a building block of future leadership.

Third, many of you were fortunate enough to provide your children with a large safety net. Once Millennials are away from that protection, it may be difficult to learn how to thrive in an environment that encourages risk-taking through reach assignments and problem-solving without clear direction. There is a difference between being pushed by parents along the path to success and knowing what to do when that path must be traveled alone. Workplace navigation skills are critical to career success and advancement, but do not assume that all young workers arrive adept at steering their way forward. But if you are willing to invest in the process of meaningfully integrating young employees into the culture of your workplace, you will maximize the likelihood of optimal performance.

Fourth, replace clout with mutual respect. Millennials are often viewed as being disrespectful for asking too many questions. Getting past this reaction is crucial, however, to bridging generational differences at work. A free and open exchange of ideas invariably leads to a better result and a more engaged workforce.

Fifth, pay greater attention to workplace dynamics, particularly around technology. Consider ways to provide internal credit for a Millennial’s unrecognized role as tech support when they are frequently asked to troubleshoot the problems senior workers encounter on their devices. In addition, formalized reverse mentoring programs can help Millennials develop stronger relationships with their more senior colleagues, which has the added benefit of making older workers more technologically proficient.

Finally, recognize that research consistently documents that Millennials are committed to a life in which family responsibilities are not overshadowed by work. This is no longer a woman’s issue alone, as the desire for flexibility has become a gender-neutral issue. Millennials value work-life flexibility and its availability leads to workplace loyalty and engagement.

In the pomp and circumstance of the next several weeks, graduates need to hear speeches grounded in an understanding of the actual challenges they are about to face, as well as the expected acknowledgment of their past accomplishments. As this year’s Millennials embark on their career journeys, the best graduation gift would be a workplace in which senior generations stand ready to welcome them with an understanding of their strengths, and a genuine desire to help them succeed. The health of our workplaces, and our economy, depends on it.

Generating Data on What Customers Really Want

At a fundamental level, the decisions managers make about revenue and profits fall into two categories—those related to growth and those related to cost reduction. Both types are meant to increase margins. But how data are used in each decision-making process is completely different.

Cost reduction data are precise. Firms know their cost structure very well and can compute with a reasonable level of certainty the savings each alternative being considered will generate. Managers use cost-related data as an objective input for decision making, since they consider it both reliable and reasonably predictable.

Managers do not treat growth-related data in the same way, and for good reason. Growth alternatives usually involve either launching new products or entering new markets, and these are activities where uncertainty is high. Here data are used mainly as a tool for persuasion among managers. A stereotypical example would go more or less like this: Managers gather the data that reinforce their own point view on what they believe is the right business decision. During a meeting they all explain their various rationales and present their various data points. Usually, they end up reaching a consensus that they all consider makes sense. Then they leave the room still thinking that their own alternative was best but that in life you have to make tradeoffs.

Most growth-related decisions in management are made this way because managers do not have data that reliably predicts how new customers will react to their offerings or how any customer new or old will react to innovative offerings. If only Coca Cola would have predictably known that its customers would not embrace New Coke! But its executives lacked a way to generate predictable information on that score or tell them that the data they’d generated from their taste tests would ultimately not be relevant.

Disruptive innovation practitioners have just such a tool for reliably predicting customers’ behavior. It’s a methodology that uncovers what in disruptive innovation parlance is called a person’s “job to be done.” Briefly, the idea is this: Consumers don’t go to the store to buy products. They go to the store to buy something that will enable them to get some important job done in their lives. The classic example, attributed to HBS professor Ted Levitt, is that people don’t want to buy a quarter-inch drill; they want something that will make a quarter-inch hole. Making a quarter-inch hole is the job to be done. The product that does that job most reliably, easily, conveniently, and less expensively is the tool they will be most likely to purchase for that job.

Work out your customer’s jobs-to-be-done, disruptive innovation practitioners have found, and you will generate data that more reliably predicts what a customer will buy and why. How do you do that? Traditionally, corporate innovators are told to conduct ethnographic studies, starting with no preconceptions, and to observe customers’ behavior and frustrations with the same open mind that start-ups employ. Human nature being what it is, that’s a hard thing to do.

Here, instead, is a simplified version of a methodology for identifying a customers’ job-to-be-done that starts with information about your own product. Since product information is not part of a job-to-be-done, the information about your product will drop out of the process in step 6, so that it doesn’t distort your results. But in this way, you can make your way to a new insight by starting in familiar territory. (And you’ll not keep the people you’re interviewing wondering what all your questions are about during the entire interview process.)

Step 1. Prepare a list of the key characteristics of your offering. List at least 10 of them. Your product or service may be faster than your competitor’s. Or cheaper. Or have a better screen resolution. Or have leather seats. Or a battery that lasts for many days. Or connect to the internet and let you play with other people online. Let’s say you sell cars. Your list might include characteristics such as speed, gas consumption, how little it pollutes the environment, number of doors, colors, type of seats, cup holders and amenities inside the car for the driver and the passengers.

Step 2. Interview at least 10 consumers and 10 nonconsumers about the various features connected to your offering. Nonconsumers are people who are not buying either your offering or your competitors’. So in this case you would be interviewing both people who drive cars and people who could drive cars but chose not to. The interviews can be anonymous, but you need to record the entire conversation. For each of the characteristics listed above ask three questions. First, “Where are you when you are using this feature?” Second, “When you use this feature, what are you really trying to do?” And third, “If this feature were not available, what would you be using instead?” Now, here’s an important part: for consumers, you need to ask the second two questions without reference to your product. So, to return to the car, let’s say you asked: “Why do you sit in the passenger’s seat of your own car?” and the answer was: “I am a salesman, and in between meetings I work in the car.” Then you ask: “When you do that what are you trying to accomplish?” He answers: “I try to have an environment that mimics my office space so I can concentrate and work comfortably for a while.” Then the third question: “If you could not do that what would you do instead?” He replies: “In the car I use the cup holder for my coffee, and in the passenger’s seat I can work with my laptop and recharge my phone. If I could not do that I would go to a cafeteria, but it is difficult to concentrate there. It’s noisy and I waste time locating one.”

Step 3. Transcribe the recordings. It is important that you do not miss anything. The transcript must end up looking like an interview, faithfully recording exactly what was said, complete with pauses. Being systematic about when the data stop is important for the statistical analysis used in step 5.

Step 4. Codify the transcripts by tracking all the meaningful nouns, verbs, adjectives, and adverbs. To continue our example we would extract from the sentence: “I try to have an environment that mimics my office space” will result in the following codes: “try,” “environment,” “mimics,” “office,” and “space.” With this you create a table in which you count the number of instances of each word (so if in the entire first transcript the word office is only repeated once you would have a 1 in the first row). Complete the table until all the sentences from all the transcripts have been codified. There are software tools available to do that more easily.

Step 5. Group the codes. Using the statistical technique of cluster analysis, group the codes based on their proximity. That is, it measures how many times each word appears close to one another (that’s why the pauses matter). Let the software that you choose determine the optimal number of clusters. The end result is that all your codes will now appear in groups.

Step 6. Remove descriptive data so you have only prescriptive data left. To do this, you remove all the groups that contain information about your product, in this case, all the groups that contain the word “car.” The end result is a series of groups that each contains a number of different code words. Within each group, these codes refer to the customer’s way of thinking and the portions of the context that the customer considers relevant to deciding on which product alternative to buy. If you compare how product performs in relation to the concerns expressed in each group, your next product improvement will become compellingly clear, not only to you, but also to your colleagues. In this example, it would become easy to make the case for focusing an innovation effort on helping salespeople become more productive and work more comfortably in their cars. Better electrical outlets, perhaps, so people can charge more than one item at a time? Storage for computers or samples? Something that mimics a desk more effectively? The point here is this is a fruitful avenue for further attention since most car models sell fewer than 100,000 units per year, but millions of people work in their automobiles.

During the 1950s Edward Deming and others developed such tools as statistical process control charts and total quality management techniques that have made the cost-reduction data we use today predictable and reliable. Before that, though, data about cost reduction was as unreliable as growth related data are today. Now the first tools are starting to emerge that add predictability and reliability to growth related decisions. Jobs-to-be-done is one such tool. Once managers learn how to compute a job-to-be-done by themselves, their growth related decisions will become much more objective and less opinion based.

Persuading with Data

An HBR Insight Center




Visualizing Zero: How to Show Something with Nothing
Data Alone Won’t Get You a Standing Ovation
Data Doesn’t Speak for Itself
Data Goes Best With a Good Story (and Vice Versa)

The Best Lecture I’ve Ever Heard

Mr. Frost, my superb economics teacher in England, once shared the story of two people talking about a lecture given by the late Milton Friedman, the father of Monetarism. The first said, “Twenty years ago, I went to the worst lecture I’ve ever heard! Friedman gave it and I still remember how he just muttered on and on and all I could make out was the word ‘money.’” The second man responded, “If you can remember what the key message was some twenty years later, I think it might be the best lecture you ever heard!”

Indeed, Friedman’s singular message — that by controlling the supply of money, you can stabilize the whole economy — became, arguably, the most impactful economic theory of the second half of the 20th century. The point I wish to emphasize is not an economic one, but a human one: if you try to say too many things, you don’t say anything at all.

It is clear, in the conference keynotes that I give anyway, that if we take on too many subjects, the message will not be remembered 20 days later, never mind 20 years later. The communication challenge is immense: often such events are packed with a dozen different speakers, each with a plethora of ideas. Then there is the digital distraction of the participants’ smart phones within easy reach. According to research reported in TIME magazine, the average phone user unlocks their phone 110 times a day and at the highest levels, 900 times a day. The best compliment I ever received from a conference organizer was that she had not seen one person reach for a digital device during my presentation. That doesn’t happen every time, of course. But through trial and error over many years, I have learned a few lessons about ensuring that the essential message is heard amidst all the nonessential noise:

1. You can’t communicate what you haven’t defined. I was once asked to work with an executive team who wanted to find a sticky message for a new initiative they wanted to run. But after interviewing a series of executives involved, all on video, I realized the problem was really a strategy problem dressed up as a communications problem. They couldn’t communicate the message with greater effectiveness until they defined their message with greater clarity. And that meant making decisions about what their initiative was and what it was not. I have found that designing a message around the following helps: “I am teaching [this narrow subject] to [this specific audience] in order that they [clear learning objective/call to action].”

2. Lose the slides and have a conversation. I recently spoke at SXSW, a conference held in Austin, Texas that attracts thousands of creative movers and shakers.When I spoke, there was standing room only and a palpable energy. Sensing the pulse in the room, I killed the slides and just had a conversation. Basically, I asked one question: “Why are otherwise intelligent people tricked by the trivial?” Lots of people shared their thoughts and we riffed on each of the comments, which ranged from “We’ve been trained from our first days in school to do what we’re told without question,” to “We have so many things to do, we’re overwhelmed.”

Then, instead of simply moving on to another question, I led the conversation back to the same one. We just kept going deeper on the same question and the conversation in turn became richer. Slides would have inhibited that conversation. One person said afterwards that the session had been the highlight of SXSW for him; another said it was the most interactive session of the whole event. Slides lead people to lean back in their seats while a conversation causes them to lean forward and engage.

3. Kill your darlings. Stephen King has written that in order for a story to come to life, you must “kill your darlings, kill your darlings, kill your darlings, even when it breaks your egocentric little scribbler’s heart, kill your darlings.” The same type of self-editing can be applied to telling stories. Jack Dorsey, the CEO of Square and co-founder of Twitter, thinks his primary job is to be the Chief Editor of the company in order to “present one cohesive story to the world.”

4. Be repetitive without being boring. Alastair Campbell, the communications advisor to Tony Blair for years, explained at a CIPR conference the challenge we face today in getting a message through in our noisy world: You’re in a huge room with a wall on the far side that’s painted white. Your job is to paint it blue using only the paint gun in your hand. You shoot a single ball and it hits the wall on the other side and makes the tiniest blue mark. You’ve got your message out there once, but it’s still drowned out. So you shoot another ball over. Then another and another and another. You keep going with great persistence until you look over there and the wall starts to look as if you aren’t sure if it’s white or blue. This, according to Campbell, is the best you can hope for.

But before you can be repetitive, you have to decide on the one message you want to hammer home – which means prioritizing. When the word priority came into the English language in the 1400s, it was singular. What did it mean? The very first or prior thing. It continued to have that useful definition for the next five hundred years. However, in the 1900s we pluralized the term and started speaking of priorities. But can we really have many first or prior things? Words can be potent enough to change the world, but if we try to share too many different messages, we water down the power of our message.

Whether you’re an executive preparing to give a high stakes keynote or an event organizer (which might be the most underappreciated job out there), you want participants to be impacted and inspired. You want a home run, not another forgettable talk. You want participants coming up to you months—or years—later thanking you for giving that talk or bringing in that speaker. It can be done, if you practice the disciplined pursuit of less, but better. That is the price for having people say, “That was the best lecture I’ve ever heard.”