Marina Gorbis's Blog, page 1553

Apple's New iPhone 5C and 5S: the Results of Creativity or Innovation?

Every idea, no matter how ingenious or successful, will eventually need to be replaced with a new one. But business leaders, as human beings above all, tend to cling to their existing ideas, beliefs, and other mental models — or what we call boxes — longer than they should. For instance, Henry Ford famously insisted on continuing to manufacture the Model T long after his competitors were creating dazzling new automobiles that significantly cannibalized sales of his once bestselling car.

When Apple first created its highly disruptive, history-making iPhone, the company unleashed years of innovation not just in its phone offerings, but in a seemingly infinite stream of related accessories and applications. The release this week of Apple's long-awaited iPhone 5C and 5S should offer business leaders everywhere a vivid reminder of the distinction between paradigm-shifting "creativity" and the "innovation" that often follows. Creativity and innovation are two separate processes — both important, but not identical.

Creativity can be defined as people's ability to change their perception of reality; by doing so, they can then create new ideas, hypotheses, approaches, and other "boxes." Apple couldn't come up with the original iPod, for example, until its leaders changed their mental boxes regarding what a portable music player was — from the Sony Walkman to one associated with a broader ecosystem. The iPhone was not the first mobile phone, but it fundamentally changed the box of what a mobile phone could be (as Apple also did with the iPad and mouse).

Innovation can be defined as a change in reality. In other words, innovation means taking an existing idea or box, such as the idea for a new product, service, or business model, and turning it into reality (for example, by manufacturing the product or implementing the business model). Once the first iPhone was developed, Apple was free to create all sorts of new features for and iterations of the iPhone and iPad — encouraging customers to change their own understanding of the products' possibilities.

Incremental innovations — think of BIC introducing double-bladed or triple-bladed razors once they were already in the razor business — do not require the creation of a new box. But transformational innovations — such as when BIC transformed itself from a pen manufacturer to a company that makes all sorts of disposable plastic objects, including pens, razors, lighters, calling cards — do require a new box.

The development of the earliest lanterns and light bulbs was based on the assumption that "light is created by burning something." Once this box was established, engineers innovated by trying different materials, such as various wicks or oils, to improve the quality and duration of the light. Only when Thomas Edison shifted his, and the world's, perception to embrace a new box — that light is created by preventing something (the filament) from burning — could he then create the first incandescent light bulb.

In creating the new iPhone 5C and 5S, did leaders at Apple have to change some of their most fundamental perceptions of the company and the products and services it provides? Put differently, did Apple create a whole new box or did it use its legendary R&D skills to innovate further?

One thing is clear: no matter how robust and dominant this technology is today, eventually the iPhone and its ecosystem, and the ideas and assumptions underlying them, will need to be reexamined and replaced. And just imagine the tremendous new opportunities and offerings that Apple will provide the world when it does so!

Six Principles for Developing Humility as a Leader

Whether we're looking at business or politics, sports or entertainment, it's clear we live in an era of self-celebration. Fame is equated with success, and being self-referential has become the norm. As a result we are encouraged to pump ourselves full of alarming self-confidence. Bluster and the alpha instinct, contends Tomas Chamorro-Premuzic, professor of business psychology, often get mistaken for ability and effectiveness (at least for a while). It may well be why so many (incompetent) men rise ahead of women to leadership positions, as Chamorro-Premuzic argued in a recent HBR post.

Yes, we have scores of books, articles, and studies that warn us of the perils of hubris. The word comes from the Greek and means extreme pride and arrogance, generally indicating a loss of connection to reality brought about when those in power vastly overestimate their capabilities. And yes, many of us have also seen evidence that its opposite, humility, inspires loyalty, helps to build and sustain cohesive, productive team work, and decreases staff turnover. Jim Collins had a lot to say about CEOs he saw demonstrating modesty and leading quietly, not charismatically, in his 2001 bestseller Good to Great.

Yet the attribute of humility seems to be neglected in leadership development programs. And to the extent it is considered by managers rising through the ranks, it is often misunderstood. How can we change this?

First, let's get a few things straight. Humility is not hospitality, courtesy, or a kind and friendly demeanor. Humility has nothing to do with being meek, weak, or indecisive. Perhaps more surprising, it does not entail shunning publicity. Organizations need people who get marketing, including self-marketing, to flourish and prosper.

Hubris, meanwhile, is not a fair label to apply to any person who thinks differently and has the courage to assert or act on their convictions. Studies show, however, that serious problems emerge when robust individualism commingles with narcissism — another term for which we can thank the Greeks (whose demigod Narcissus fell in love with his own reflection). Narcissism combines an exaggerated sense of one's own abilities and achievements with a constant need for attention, affirmation, and praise. While the label tends to be applied loosely to anyone behaving in a self-absorbed way, psychologists know narcissism to be a formal personality disorder for some, and a real impediment to their forming healthy relationships. The narcissist lacks self-awareness and empathy and is often hypersensitive to criticism or perceived insults. He or she frequently exaggerates contributions and claims to be "expert" at many different things. If you are part of an organization with a leader exhibiting such characteristics, you have a problem. (Executive search firms and hiring committees beware.)

But beyond refusing to hire or promote such extreme cases, can and should organizations try to cultivate more humility in their leadership ranks? How would that goal take shape in the context of a formal leadership development program? As a starting point, we would suggest a curriculum designed around six basic principles. If you're a developing leader, you should be taught to:

Know what you don't know.

Resist "master of the universe" impulses. You may yourself excel in an area, but as a leader you are, by definition, a generalist. Rely on those who have relevant qualification and expertise. Know when to defer and delegate.

Resist falling for your own publicity.

We all do it: whether we're writing a press release or a self-appraisal, we put the best spin on our success — and then conveniently forget that the reality wasn't as flawless. Drinking in the glory of a triumph can be energizing. Too big a drink is intoxicating. It blurs vision and impairs judgment.

Never underestimate the competition.

You may be brilliant, ambitious, and audacious. But the world is filled with other hard-working, high-IQ, and creative professionals. Don't kid yourself that they and their innovations aren't a serious threat.

Embrace and promote a spirit of service.

Employees quickly figure out which leaders are dedicated to helping them succeed, and which are scrambling for personal success at their expense. Customers do, too.

Listen, even (no, especially) to the weird ideas.

Only when you are not convinced that your idea is or will be better than someone else's do you really open your ears to what they are saying. But there is ample evidence that you should: the most imaginative and valuable ideas tend to come from left field, from some associate who seems a little offbeat, and may not hold an exalted position in the organization.

Be passionately curious.

Constantly welcome and seek out new knowledge, and insist on curiosity from those around you. Research has found linkages between curiosity and many positive leadership attributes (including emotional and social intelligence). Take it from Einstein. "I have no special talent," he claimed. "I am only passionately curious."

We can't imagine that an individual exposed to the six principles above and encouraged to take them to heart could become anything but a better leader.

But meanwhile, assuming your organization isn't already helping its leaders develop such habits of mind, let us leave you with two humble, and humbling, suggestions. First: subject yourself to a 360 review. Anonymous feedback from the people who surround you may constitute a mirror you won't love gazing into, but as Ann Landers wrote: "Don't accept your dog's admiration as conclusive evidence that you are wonderful." 360 feedback pays off in two ways. It shows you how your self-perception deviates from others' perception of your leadership. (And in leadership, perception is reality.) And it gives you a valuable practice in receiving feedback and turning criticism into a plan for growth and development.

Second, get a coach. We all have blind spots, and there's certainly no shame in getting help with them. Fast Company reports that 43% of CEOs and 71% of Senior Executives say they've worked with a coach. And 92% of leaders being coached say they plan to use a coach again.

Resolve to work on your own humility and you will begin to notice and appreciate its power all around you. In a recent meeting we convened in Los Angeles, the accomplished Chairman and CEO of a major Hollywood studio shared the benefit of his experience with 20 young professionals and students. What did this leader emphasize with the group? He spoke of his own failures, weaknesses, and blind spots, and how they had spurred his learning and success. The fact that he spoke about himself in this way deeply impressed the group. He projected convincing self-confidence, authenticity, and wisdom.

He was a convincing example of the kind of leader our organizations should be trying harder to develop — the kind that knows it's better to develop a taste for humility now than be forced to eat humble pie later.

Female Entrepreneurs Go Beyond "Cookies and Crafts"

In the 1990's, if you asked most women business owners what their dreams were, they'd say they just want to be able to support themselves and their families. The times have changed. Today, women have bigger dreams and seek to grow their businesses to the maximum level. However, many are still saddled with an outdated perception about their roles in business and contributions to the economy, despite tremendous growth over the past decade.

The old perception is that women-led and -owned businesses are micro-enterprises; companies run out of the home with fewer than five employees. But most women outgrew the "cookies and crafts" stereotype a long time ago, and have their sights set on bigger goals. Many have found success in industries like technology, mining, and construction.

Progressive thinking is being pushed forward by new data that showcases the undeniable impact of women-led and -owned businesses on the economy. Consider these datapoints:

American Express OPEN's latest Growing Under the Radar report details just how strong these businesses have been over the past decade. Perhaps the most surprising data is that women-led and -owned businesses experienced 57% growth in revenue of $10 million or above. That is actually a growth rate of 47% more than their male counterparts. This data is even more impressive in the context of a down economy: women-led and -owned businesses continued to grow throughout the recession, as companies around the world had to tighten their belts to weather the storm. The same report indicates that health care, social assistance, and education are industries in which the growth of women's ownership has been the strongest.
The membership of the Women Presidents' Organization (WPO), a nonprofit peer-advisory group for women with $2MM-plus gross revenue, itself accounts for $19BN in aggregate revenue and over 142,000 jobs, stemming directly from its 1,700+ female business leaders. In the WPO, the largest number of businesses are in manufacturing and distribution and 25% of members generate over $10 million annually.
Forbes called 2013 the "Year of the Female Founder." As female entrepreneurship gains steam, interest from venture capitalists will grow as well. There are now a number of investment groups, like Golden Seeds, that specialize in funding and empowering women-led businesses.

It makes sense that we're seeing such a tremendous growth rate for women-led and -owned businesses at this particular time in history. In 1977, only 4.5% of privately held businesses were owned by women. Those businesses were mainly in fashion, fitness and beauty. Today, the greatest number of multimillion-dollar women-owned businesses are in wholesale trade (20%), finance/insurance (12%), and transportation/warehousing (11%).

Over the last decade, women-led and owned businesses generating more than $1 million have grown 31%. That number would be even greater if businesses owned 50/50 by male and female partners and businesses with financial investors were included in census data.

With so many women-led and -owned businesses reaching such lofty benchmarks in the last decade, the stereotypes about female business leaders are thankfully beginning to wear thin. As more women ascend the corporate ladder or build their own businesses from the ground up, they'll bring even visibility to the success of women throughout business.

Strategic Humor: Cartoons from the October 2013 Issue

Enjoy these cartoons from the October issue of HBR, and test your management wit in the HBR Cartoon Caption Contest at the bottom of this post. If we choose your caption as the winner, you will be featured in next month's magazine and win a free Harvard Business Review Press book.

"Watch yourself out there. This guy looks like he means business."

Mick Stevens

"We don't expect you to be married to your job, but the odd date might be nice."

Susan Camilleri Konar

"Hey, Frank, hold up. I stapled the wrong list of grievances to your forehead."

PC Vey

"All booty, ill-gotten or otherwise, must be declared as income."

Michael Shaw

And congratulations to our September caption contest winner, Tim Dean of St. Louis, Missouri. Here's his winning caption:

"Hope you like decaf."

Cartoonist: Paula Pratt

NEW CAPTION CONTEST

Enter your own caption for this cartoon in the comments field below — you could be featured in next month's magazine and win a free book. To be considered for the prize, please submit your caption by Thursday October 19, 2013.

Cartoonist: Paul Kales

A Discount May Devalue a Product More Than a Giveaway

Consumers who were offered free bread sticks as a promotion from a pizzeria said they'd be willing to pay $5.06, on average, for them once the promotion ended, only slightly less than the amount consumers were willing to pay when there had been no promotion, say Mauricio M. Palmeira of Monash University in Australia and Joydeep Srivastava of the University of Maryland. By contrast, people who were offered the bread sticks at a discounted price of 50 cents were willing to pay just $2.76 once the promotion was over. The findings suggest that a discount promotion may devalue a product in consumers' minds, whereas a free promotion offer may not devalue a product at all.

What's the Point of Creativity?

Creativity and innovation are hot topics these days, and they are being studied more frequently and intensely. Great observations have come of the attention, as Will Burns writes for Forbes: A coffee-shop study from the University of Illinois concluded that moderate levels of noise, as opposed to high or low levels, foster greater creativity. A study from the University of Stuttgart found that low levels of lighting enhance creativity. And then there's my favorite, another study from the University of Illinois, that concluded that alcohol intoxication improves creative problem solving.

The attention is good, but too often creativity is studied and written about without examining context. Why would we want to be more creative? Why bother fostering the conditions for creativity? Why dim the lights, adjust the volume, and get drunk? What's the purpose of it all?

The unspoken assumption is that our goal is to gain competitive advantage, to crush the competition, to win. But I believe that the best creativity comes from a much deeper place than the desire to win. It comes from a desire to contribute to the lives of others, either by introducing something new that improves the quality of their lives or by showing people that something thought to be impossible is in fact possible. When you change people's perceptions about what can be accomplished or achieved, you contribute to their humanity in the richest possible way. You give them hope for the future — a sense that life is not the demoralizing, unchanging drudgery day after day that the world so often teaches us that it is. When you change the way people think about possibility, it is an existential experience. It makes them feel understood. More than that, it makes them feel loved.

When JetBlue said it was going to bring humanity to its business, it reunited two worlds that had been estranged for decades. When it put those TV sets in the backs of the seats, upholstered the chairs in leather, and gave everyone a little more room, people felt loved. "You know what it's like to be crammed in one of those tiny seats for five hours going out of your mind with nothing to do! You're one of us! You understand me!"

This, in a world in which people so often feel not just that they're misunderstood but that no one is even bothering to understand them. Have you ever been on hold with customer service and heard a recording that says, "This call may be monitored for quality assurance"? Have you ever once seen evidence of customer quality improving as a result of all of that monitoring?

Increasingly, creativity — and the study of it — is divorced from the real needs of real people. Adding ever more gimmicks to a smartphone in the interest of increasing market share, rather than giving people something revolutionary that will make their lives better, reeks of something other than love and has no power to stir peoples' enthusiasm.

So the question we have to ask ourselves in business is this: Why create? Are we doing it for the gratuitous sake of creativity itself, without any larger purpose? Are we doing it because Harvard Business Review writes about it all the time? Are we doing it out of fear? To make more money? To get on the cover of Wired? Or are we doing it out of a desire to improve people's lives and transform their sense of what possibilities life itself has to offer?

I write a lot about philanthropy. Philanthropy means, literally, love of humanity. You don't have to give a million dollars to charity to be a philanthropist. You simply have to actively demonstrate your love of humanity. Your empathy. If the purpose of our creativity is philanthropy — if it is love for our fellow man, an appreciation that people struggle in their lives, and a desire to somehow lessen that struggle and increase their joy, with a little more leg room or with an iPad — it will change the world. And that is the greatest competitive advantage of all.

What See-Through Pants Can Reveal About a Company's Weaknesses

Downward Dog, Perhaps


Lululemon, the upscale retailer of yoga clothing, is doing great. Except when it's not, which is becoming increasingly common — see the sheer pants crisis, the abrupt resignation of a CEO, a poorly-received job ad to replace said CEO, and a bit of media heat over a 2011 murder that occurred in a Bethesda store. And there's no denying that Lululemon founder Dennis "Chip" Wilson figured out something stupidly revolutionary early on: Women's exercise clothes should be made to fit women (not small men), and women will pay top dollar for what's comfortable, durable, and stylish. Hooray! But in this brief investigation by Beth Kowitt and Colleen Leahey, it's pretty clear that having an idea and running a company are very different things — and that Wilson may only sort of know how to do the latter.



For years, the creative side of the company was the top priority, leaving things like finance, IT, and HR to suffer (yes, they tried to run their operations on spreadsheets). Lululemon was also slow to develop quality-control systems in manufacturing (thus the unfortunate pants), with fewer than 30 employees overseeing 90% of the 30 million units of clothing per year. After former Starbucks executive Christine Day was named CEO, Wilson also faced a passionate-founder's crisis: He didn't know what to do. Holding roles ranging from chairman to chief innovation and branding officer, he "tended to zoom in and out, creating confusion about who was in charge." While we don't know what led to Day's resignation, Kowitt and Leahey posit it had something to do with the ethos of the company, which was either all-in with the founders' ideas or, to quote Day, "peace out." Wilson, for his part, says that Day did what they brought her in for: "to replicate a perfectly set-up organization that just needed basically the knowledge of how Starbucks replicated what they did." Ouch. The authors also say Lululemon should probably pay more attention to its supply chain. After all, they point out, strong supply chains "are the hallmark of businesses that outlast their founders."

The Option You Can't Use

Workplace Flexibility is Top Consideration for Nearly Three-Fourths of U.S. Working Adults Mom Corps, Harris Interactive

Two-thirds of working adults surveyed by Harris Interactive for talent-acquisition firm Mom Corps say their companies would be willing to accommodate them if they requested flexible work schedules (for reasons such as taking care of their kids). Yet 47% of respondents feel that asking for flexible options would hurt their chances of advancement. So even though flexibility is gaining popularity as an abstract concept, organizations aren't doing enough to make employees feel secure in actually using it. That represents a "significant disconnect between employer and employee," says Mom Corps CEO Allison O’Kelly. —Andy O'Connell

There Are Actually Many Reasons

The Real Reason Women Are Leaving Wall Street Quartz

In Wall Street’s heyday in the early 1980s, author Margo Epprecht was a young analyst who worked across the hall from Maryann Keller. Keller, a top auto analyst, "never rested," working the phones and gathering industry data constantly. She had reached a level of high authority and was widely respected; yet when Epprecht went back and interviewed her recently, Keller reflected, with a laugh, that she had "thought she was going to die" with that workload. More important, she said Wall Street now is less appealing to women than it was 30 years ago. "It's not as intellectually challenging as it used to be," she said. "It's more like cage fighting."



This is just one of many interviews and observations that shed light on what, exactly, is going on with gender and Wall Street. While there's no single conclusive answer to the question alluded to in the title of the piece, the combination of a deep-rooted culture of man-to-man networking and the sheer number of market downturns over the past few decades — during which women were laid off disproportionately — has created a place where the brightest of the bright (yes, they're more often than not of the lady persuasion) can't actually thrive. And with their reluctance to take dangerous financial risks, something that led to the 2008 collapse, Wall Street probably needs them more than ever (as does the global economy).

Missing the "How" and "Why"

The Psychiatric Drug Crisis The New Yorker

"Why would an industry beat a hasty retreat from a market that continues to boom?" This is the million-dollar question facing the psychiatric-drug industry, a sector that has been wildly successful in making drugs like Paxil and Zoloft, says psychotherapist and author Gary Greenberg. Corporate giants like GlaxoSmithKline and Merck have been backing away from neuroscience research and from developing new drugs to ease anxiety and depression, and one reason is that the science behind these pills might not actually be science at all, but a psychopharmacological misunderstanding that's made billions.



SSRIs alter serotonin metabolism, but those changes don’t explain why the drugs work, and researchers have given up on the highly marketable but too-simplistic view that depression is just a matter of a chemical imbalance. Pharma companies are unable to produce new depression drugs because "scientists don't even know where to begin." Thus, "it makes no sense for the industry to stay in the psychiatric-drug business."

Sorry for Your Loss

Hallmark Struggles to Update Its Card Empire The Verge

When's the last time you received a Hallmark card on Facebook? ("Never," you say. "But my grandmother just sent me one in the mail for my birthday.") Now think about the last time you saw a Someecard on the site ("Just today," you explain, chuckling at its almost perverse yet perfectly applicable life message, which seemed like the opposite of anything your grandmother would ever dare send.) Such is the struggle facing the greeting-card industry, whose revenue has declined 5.4% over the past five years. Hallmark in particular, which by all accounts is doing better than most, with $4 billion in revenue last year and almost half the market, seems to know that it can't simply keep doing business as usual. A company spokesperson told The Verge that its analog products are doing great — who doesn't need ornaments, crayons, or, er, the Hallmark Channel? The company, writes Carl Franzen, is betting on nostalgia, which may not help Hallmark going forward — or protect Kansas City's third-largest employer. That's OK, says Someecards CEO Duncan Mitchell. "Maybe if we get big enough, we'll just buy them."

BONUS BITS:

Mommy (and Daddy) Dearest

We Post Nothing About Our Daughter Online (Slate)
Media Elites Are Creating Twitter Accounts for Their Babies (New York Magazine)
I Didn’t Know What ‘LOL’ Meant (The Daily Beast)

Don't Let Your Career "Just Happen"

We all know The Statistic: Only 4.2 percent of Fortune 500 CEOs are women. But the gender split in mid-level management is now nearly even. While women have made progress in being recognized as managers, why aren't they making it to the top?

In many cases, they've climbed to the last rung of a ladder that simply doesn't go all the way up, like a business function (HR, perhaps) that isn't generally tapped for the CEO position. In others, they lack the critical experiences or skills required to take the next step, such as an international assignment, high-risk project, or major P&L responsibility. While many complex factors contribute to women hitting the glass ceiling, more proactive career management and clearer manager guidance would help them identify and use the right tools to break through.

When Hay Group examined the performance and paths of 12 of the highest leading women in one Fortune 500 company and other executive women in large, global organizations, we found that, like their male counterparts, the highest-performing women had in common a strong orientation toward achievement. But more than men, this was manifested as a lifelong focus on continuous learning, which helped them prepare for the roles they took as they moved upward.

But we also found that these traits are not synonymous with proactive career management. Women — even high-performing women — still have a ways to go in becoming intentional and specific in their efforts to drive their careers up a particular ladder.

Our study found that women are less deliberate than men in their career progressions, thinking, "I will learn, grow, and build my capabilities," rather than, "I will create opportunities to learn X and gain experience in Y to get to position Z."

The former mindset can drive advancement to a point, but we found that without specific career plans, women often weren't the ones behind the wheel: Many high-performing women who participated in our study felt that their careers "happened" to them — driven by recognition from sponsors who gave them opportunities. Which is fine, unless you want to be the CEO, and the sponsor-identified opportunities don't give you the skills or perspective required to get there.

Those who want to move all the way up must create opportunities to understand how the organization works, how it makes money, and who its key people are. And they need to do so early in their careers. Sometimes a lateral move to gain experience across business lines is a better choice than a promotion within a department, and it can help women avoid being promoted up a functional silo by managers seeking to use their talents to advance their own agendas.

Because women won't be handed the experience they need, they must speak up. Many women in our study felt uncomfortable with the self-promotion of "asking for a job." Some have found it easier to think of such conversations as expressing interest in or speaking up about new ways to be helpful. Regardless of your approach, do speak up. You don't want management to pass you over because they thought your silence meant satisfaction with stasis, or there was a squeakier wheel.

Our research also indicates that women tend to hesitate when offered promotions because they didn't expect them, felt unprepared, or needed time to address work-life considerations. This is where women's tendencies to forego informal networking (like after-hours drinks) can hinder them: that inkling you're about to be promoted might be more apparent in a social setting than it is in the office. So stay in touch at work.

And stay in touch at home. While you're thinking about what your future job could be and learning new skills and roles to take it on, keep conversations open at home about how your life outside work could change if those career opportunities came to pass, and what would have to adapt. Having a forward-thinking home plan can help you say "yes" without hesitation.

Part of the blame for the c-suite gender gap lies with recognition and advancement policies — or lack thereof. Managers can help ensure the strongest leaders rise through the ranks, regardless of gender, by:

Providing employees with an orientation to the organization and the business, and advice for navigating one's career.
Clearly defining the criteria and experiences necessary to qualify for key leadership positions.

In doing so, the organization gives employees clearer pictures of the work, skill, and knowledge required to rise, and they help eliminate hiring biases that could otherwise push particular constituencies onto career ladders that don't go all the way up.

Women managers, of course, have a symbolic role to play once they reach the top, though many tend to shy away from it and hide family and "feminine" aspects of work-life balance. Please don't. Be a mentor. Join women's leadership groups. Show those coming up behind you how you prioritize, share your rationales for your personal and professional boundaries (yes, this means it's OK to say you're leaving early for the school play), and be as intentional in these realms as you are in your career decisions.

Customer Intimacy, Meet Operational Excellence

What is more important to company success, a strong external focus on customer experiences or an internal focus on effective and efficient operations?

Of course, it's a false dichotomy — you need both. I described in an earlier post how Tesco worked for years to improve its supply chain capabilities, then leveraged this value by using deeper customer knowledge to enrich customer experiences. But let's flip the paradigm. Some organizations which have competed successfully for decades by focusing primarily on creating unique solutions for each customer are now embracing operational excellence to drive even more customer value.

For example, catalog and online retailers like L.L. Bean have had lots of information about customers for many years that they have used to tailor offerings and services. As they have grown their ability to analyze ever more data about their customers, they have found new ways to provide uniquely tailored catalogs and offers, increasingly online. But while such customized services used to be enough to compete effectively, these retailers are now finding they need to improve their operational reliability too.

L.L. Bean is embarking on a major investment in its systems infrastructure. Terry Sutton, vice president of business transformation, told me that "The systems we're implementing are about operational excellence. As a direct marketer we have been good at customer intimacy. We know a lot about our customers. But our new system infrastructure investments are about running better. We have known for a long time that we needed to be operationally excellent, but in the past we've fixed problems reactively, after the event, to keep customers happy. We've survived through heroics."

While retailers and consumer packaged goods companies are leaders in understanding and serving their customer uniquely, no industry is closer to its customers than healthcare. Doctors are driven to understand each patient deeply and to deliver a unique solution tailored to the patient's specific needs. And new tools are emerging to push the frontiers of personalized medicine. Gene sequencing, wireless physiological sensors, and digital anatomical imaging are creating more granular patient profiling and tailored treatments. For example, gene sequencing is enabling better prediction of disease susceptibility and drug reactions. By sequencing the tumor DNA of cancer patients, doctors are able to tailor treatments only to patients who will benefit. And all the data is being captured in patients' electronic health records, allowing more coordinated and customized care.

At the same time, many healthcare organizations have been working hard to complement their historic strengths in delivering unique solutions for each patient with an added focus on operational excellence. Patient safety is one motivation. The landmark report by the Institute of Medicine, "To Err is Human, Building a Safer Health System," chronicled the unexpectedly high incidence of medical errors. Many hospitals began pursuing the "triple aim": better patient experiences, consistent quality, and lower costs. Hospitals such as Virginia Mason and ThedaCare adopted process improvement systems from manufacturing ("Lean" and the "Toyota Production System") to deliver increased consistency, reliability, and quality. While skeptics are right when they say, "Patients are not cars," the reality is that medical care is, in fact, delivered through extraordinarily complex organizations, with thousands of interacting processes, much like a factory.

Consider ThedaCare, a health delivery system with five hospitals, 26 clinics, and over 6,000 employees, based in northeast Wisconsin. Like many healthcare institutions, Thedacare was good at diagnosing and delivering unique solutions to each patient. But in 2003 ThedaCare leaders decided to focus on designing processes that consistently work better, reduce waste, and enable staff to better meet the needs of patients. To learn more about how to approach process improvement, their leaders consulted with a nearby Wisconsin-based business, Ariens Outdoor Power Equipment Company, which had successfully employed Lean management for several years. ThedaCare built its version of the Toyota Production System, which it calls the ThedaCare Improvement System. Leaders engage staff in intensive week-long process improvement efforts. There are typically five of these projects running every week. The projects have improved clinical performance, including lowering the incidence of preterm births, improving heart attack response rates, offering same-day appointments in every office and clinic, and changing the way care is delivered to a collaborative, team-based approach. ThedaCare employees have increased productivity 12 percent since January 2006, saving the company more than $27 million. They have passed those savings along to patients and insurers. With a price increase rate that is half that of their nearest competitors, their costs are consistently the lowest in the state.

L.L.Bean and ThedaCare show that organizations that have historically competed on customer intimacy can simultaneously strive for operational excellence. But it isn't easy. Autonomy to make customer-specific decisions seems to be in conflict with the use of standards, which are essential to delivering consistency, reliability, and low cost. In another post, I described how the Cleveland Clinic standardized an approach for patient web searches, so they were able to scale easily to over 100 unique patient pathways.

The art is in finding ways to optimize these apparent opposites simultaneously: introducing standard operational work wherever possible, while continuing to get better and better at delivering tailored customer solutions.

Seven Types of Sales Managers

Over the past decade, I've worked closely with hundreds of vice presidents of sales, and like all of people, each has a unique personality. Some are gregarious. Some are assertive. Some are action-oriented. But even as I observe their individual differences, I have recognized patterns of behavior, which have allowed me to catalog their styles of sales management.

I have found that seven management styles are most prevalent: mentor, expressive, sergeant, Teflon, micromanager, overconfident and amateur. Most likely, a sales leader will use several different management styles and move from one style to another depending on the situation.

To better understand these sales management styles, I asked more than 60 top vice presidents of sales from leading high technology and business services companies to estimate what percentage of their time they used a particular management style, and then to rank the applicability of the style to the success in their role on a scale of 1 (least important) to 5 (most important). Below, you will find a description of each style and the average results for the study group.

Mentors

Mentors are charismatic leaders and sales experts who measure their success using three criteria: exceeding revenue goals, creating an environment where the entire team can succeed, and helping all team members realize their individual potential. Mentors are confident in their own abilities and possess the business insight to know what needs to be done and how to do it. On average, study participants reported they used the mentor management style 26 percent of the time. In terms of importance as a driver of success, they gave mentor management style the highest ranking of all the styles at 4.3.

Expressives

Expressive managers are people-oriented with a flair for sharing their emotions and amplifying the emotions of those around them. They have a natural ability to put people at ease but are also quite comfortable extolling or admonishing the team. Expressive managers create an environment where a considerable amount of energy is focused on how their organization is thought of and perceived within the company. Study participants indicated they used the expressive management style 30 percent of the time on average and ranked the style's importance at 4.

Sergeants

The sergeant is named after the field sergeant in a military organization. Sergeants develop an intense loyalty to their team, perhaps even greater than their personal loyalty to their company. They are hard workers who are constantly worrying about their "troops." They will even sacrifice their own best interests and tolerate personal hardships if they feel it will benefit their team. The sergeant management style is used 18 percent of the time on average and its importance was ranked at 3.2.

Teflons

Teflon managers are pleasant, agreeable, and polite people. However, unlike sergeants, they tend not to have deep personal relationships with their sales team members. Another characteristic of Teflon managers is their ability to stay above the daily fray of politics. Regardless of the situation, Teflon managers are even keeled and rarely frazzled. The Teflon management style is used 10 percent of the time on average and its importance was ranked at 2.

Micromanagers

Micromanagers are the most organized and methodical of all the management types. They have a strong sense of responsibility to their company and they pride themselves on achieving their revenue goals. They tend to be all-or-nothing thinkers who want things done their way. The micromanager style is used 7 percent of the time on average and its importance was ranked 3.3.

Overconfidents

Overconfident managers tend to be more self-centered. They are charming and gregarious in public, excellent on sales calls. They tend not to be open to feedback and will get the job done their way and succeed at any cost. The overconfident management style is used 6 percent of the time on average and its importance was ranked at 1.8.

Amateurs



The amateur management style should not necessarily be equated to someone who is new to sales management. Rather, the style reflects that the person is outside of their comfort zone in a new management role, working with an unfamiliar product at a new company, or in a new industry. As a result, their management style may suffer an identity crisis until they are able to build back their practical sales experience. Study participants indicated they experienced the amateur management style 3 percent of the time on average and ranked the style's importance at 1.

The structure and effectiveness of the sales department will mirror the sales management style of its leaders. This is because sales leaders naturally imprint themselves on their organization. Therefore, it can be argued that the vice president of sales is the most important person within a company because this person is in charge of an organization's most critical assets: customers and the revenue they generate.