Marina Gorbis's Blog, page 1557

Research: Underdog Businesses Are More Likely to Post Fake Yelp Reviews

The rise of online review platforms like Yelp has empowered consumers by reducing the informational asymmetry surrounding unfamiliar products and services. But some businesses face strong incentives to post fake reviews, which compromises the trustworthiness of such review sites.

How prevalent are such fake reviews, and what firms are mostly likely to post them? New research reveals that independent businesses, those without many existing reviews on Yelp, and those that face intense competition are more likely engage in review fraud on Yelp.

I reached out to authors Michael Luca, Professor at Harvard Business School, and Georgios Zervas, Assistant Professor of Marketing at Boston University School of Management, to discuss their findings. Here's an edited transcript of our conversation.

How did the two of you become interested in this line of research?

Michael Luca: We've both done extensive work on consumer review websites in the past, and I've seen in prior research that Yelp reviews are incredibly influential on sales. Because of this influence and because these types of platforms have proliferated over the last decade - think of Yelp, TripAdvisor, Angie's List, and scores of others - it's important to understand the pros and cons of this type of system relative to other information sources.

Georgios Zervas: I was working on reviews as well but from a different perspective. I was trying to see what actually shapes reviews, so I was looking at online promotions like Groupon and LivingSocial and trying to explain why these coupons tended to result in negative reviews on Yelp. So we had both done work on reviews, and we joined forces to work on fake reviews.

According to your research, what leads businesses to post fake reviews on Yelp?

Georgios: The incentives are economic. The system is set up in such a way that businesses can benefit a lot from soliciting fake reviews. So businesses will respond to incentives such as a bad recent reputation, or having few reviews, or generally being unknown.

You've shown that some new businesses post fake positive reviews when they have very few existing reviews. Conversely, established businesses (including chains) are less likely to post fake reviews. Is it possible that high-quality firms might use fake reviews as a form of free but fraudulent advertising, from which they "graduate" as their reputation builds?

Georgios: Yes, I think that makes a lot of sense. For example, restaurants may be very resource-constrained, so when a new restaurant is starting out, they may not have enough resources for advertising, and of course, fake reviews are seen by a lot of people to have a very low production cost. Once these restaurants become established, potentially they'll have more resources to invest in advertising so it's very logical that they would graduate to more legitimate forms of advertising.

Besides misleading consumers, are there any other economic costs or inefficiencies that fake reviews cause?

Michael: Just the mere presence of fake reviews has led to an arms race in the review industry. These review sites dump resources into solving the fake review problem by making it more difficult for someone to leave a review, or by forcing a reviewer to jump through more hoops to make sure he or she is real, or by filtering some reviews off of the site, as Yelp does. Every barrier that you construct on these types of platforms will help reduce the number of fake reviews, but also actually reduces the number of real reviews on the site.

Michael, you mentioned earlier that Yelp reviews can significantly affect sales. How can we quantify that effect?

Michael: The way to think about returns to reviews is in the value of the rating. Say the user goes onto Yelp and sees a business with 3.5 stars and 10 reviews next to it. And the estimates we saw in prior work is that a one-star increase in rating leads to more than a 5% increase in sales for independent businesses, which is a really huge effect. If you think about your ability to influence this at the margin, especially when you don't have many reviews, you have a very high-powered incentive to leave fake reviews.

In future work, what are some other independent variables about a business (like social media engagement, which you've mentioned) that you want to correlate with propensity to commit Yelp fraud?

Michael: One thing that we think would be exciting is the relationship between fraud and advertising. We see that people who are committing fraud have just had a negative reputational shock, are facing intense competition, or are early on in their business life cycle. On the other hand, we have work that suggests that firms using advertising have established reputations, have had positive reputational shocks. So our plan for our follow-up paper is actually to look through and think about the relationship between review fraud and advertising decisions. The question is, do firms face a substitution decision between advertising and review fraud?

How can a content aggregator like Yelp use this paper to improve its ability to detect fake reviews?

Georgios: The detection algorithms for sites like Yelp work by going through a set of reviews and carefully classifying them into real and fake reviews. Then they try to figure out some distinguishing characteristics of fake reviews. For example, fake reviews might come from users that have only written one or two reviews on Yelp ever. Then they use that indicator as a positive signal of a review being suspicious for new reviews that arrive on the site. We suggest that all these features we've identified - a business being new, or a business having recently received bad reviews, or a business facing increased competition - could be incorporated with those prior features into existing algorithms to predict whether a review is fake or not.

How might a small business with a Yelp presence use this research to improve its own sales?

Michael: One simple example is to engage with the system in an ethical way: claim your business on Yelp, make sure the information and hours are correct. This kind of persona can generate more legitimate reviews without gaming the system. Small businesses can also understand how exactly the Yelp system works. If you ask 10 small businesses how Yelp decides to aggregate reviews, you might get 10 different answers. Spending a couple of hours to understand the system and what exactly is being displayed on the other end could reduce the anxiety of somebody who otherwise views Yelp's algorithm as a black box.

What should customers who use Yelp know?

Michael: The customer should realize that some reviews might be illegitimate, and our work gives a sense of the situations in which you're most likely to see a fraudulent review.

Georgios: Most users may just look at the rating itself. Our work tells the consumer that he actually needs to read the reviews, inspect the business, ask about their advertising, ask whether it's a chain, see if it's in a highly competitive area, and then make up his mind.

To wrap up, many of your empirical results are consistent with and thus powerfully supported by theoretical predictions. Did any of your results instead surprise you by going against prediction?

Georgios: One thing that surprised us both was our very first finding - that approximately 16% of all reviews are filtered by Yelp. Nobody had measured that before. So while you could see the number of filtered reviews for an individual business, nobody had done an extensive site-wide measurement of how many reviews were suspicious.

Michael: We've found that the "bad apple theory" isn't quite valid. In our research, we both talked to a lot of small businesses, and we don't have the sense that there are these small businesses going around trying to cheat the system. Something we didn't see fully beforehand is that there's simply a lot of pressure for a small business starting out without an established reputation to go and do something that doesn't necessarily seem unethical at the time. But taking a step back, these businesses will often recognize the ethical implications of what they're trying to do.

When Work Is Challenging, Economies Thrive

"In economics, consumption is the sole end of production," the late, great Swedish economist, politician, and social commentator Gunnar Myrdal wrote in 1930. "This is a stock phrase of all the textbooks since Adam Smith: Man works in order to live." Myrdal, though, didn't think that was right:

[T]here are many people who live in order to work, who consume in order to produce, if we like to use those terms. Most people who are reasonably well off derive more satisfaction in their capacity as producers than as consumers. Indeed, many would define the social ideal as a state in which as many people as possible can live in this way.

It's fair to say that Myrdal's argument hasn't really won out. In economics, work is still mostly portrayed as just a prelude to consumption. But Edmund Phelps, the Columbia University economist who won a Nobel in 2006 "for his analysis of intertemporal tradeoffs in macroeconomic policy," has been doing his best to change that. "The passage by Myrdal and a similar one by Marshall I have been using over and over again for years now," he says, "and it always comes to people as something completely surprising."

In Phelps's telling, work is "an integral part of life itself." It's certainly an integral part of his life: At age 80, he's a professor of political economy and director of the Center for Capitalism and Society at Columbia, and for the past three years he's been dean of the New Huadu Business School at Minjiang University in southern China. He's also just written a book, Mass Flourishing: How Grassroots Innovation Created Jobs, Challenge, and Change.

In Mass Flourishing, Phelps argues that the productivity revolution that began in the early 1800s in Great Britain and the U.S., and subsequently swept the world, was the result of a change in values and attitudes that led people to seek out novel products and challenging, uncertain work. And he makes the case that the productivity slowdown that subsequently hit Western nations at various times in the 20th century was the result of a backlash against this modernist ethos in the form of socialist and corporatist attempts to bring back stability, hierarchy, and stasis.

I talked to Phelps at his Columbia office just before a Labor Day weekend that he was planning to spend, in large part, getting to his other job in China. What follows are edited excerpts of our conversation:

In your book, you make a link between whether people feel like they're achieving something at work and overall economic growth.

Well that throws me for a bit of loop. I sometimes say there are two kinds of prosperity, one is material prosperity and the other is a non-material part of prosperity — that's the experiential benefits of having the stimulus, the challenge, the gratification of solving problems, surmounting obstacles and also the having the thrill of creating something new. Figuring out a new way to do something. Or, an even more rare thing, dreaming up a new product to produce.

I think economic growth is important, but it's not why I wrote the book. I wrote the book on the conviction that innovation is important for having a healthy economy, for having an economy that will deliver prosperity.

In your telling, the novelty-seeking ethos arrived in our world in the early 1800s, initially in Great Britain.

Yes, that's right. Everybody we know always thinks that these good things started with the Enlightenment, Sir William Harvey to David Hume. But as I was starting the book and beginning to look in earnest at some data from Angus Maddison which I didn't remember looking at much before, I saw that wages actually went down in Britain between 1750 and 1800.

Yes there was a breakout in textiles in the second half of the 18th century, but in the aggregate data you just don't see much happening. And then when the Napoleonic wars finally came to a halt [in 1815], it was just like the curtain was opened, and suddenly they had this amazing takeoff of productivity and wages.

So in your argument it's this constellation of attitudes that suddenly came together to allow for a place where people were experimenting, taking risks, trying to sell new things, buying new things.

Voyaging into uncertainty, and embarking on new projects.

Yet a lot of people's sense of the mid-19th century in England is not of this barrel-of-laughs place to be.

I just find it unbelievable, that this fabulous period of romanticism has been sort of taken away from us. We only find these dreary accounts of how tough it was to be poor in the 1830s. There's such a naïvete about how things were before the 19th century. I mean, can you imagine if you had to spend all day tending sheep all by yourself? Nobody to talk to, no change going on. I mean, my God, it's almost like a prison sentence. And then when people got to cities they could talk to people and have conversations and get involved in things.

What does the kind of workplace that delivers both non-material and material benefits look like?



It would probably be in a city where there are related businesses. You need some entrepreneurial people who get things done, but you also need some more cerebral, more dreamy types. You want a diversity of people in your company.

Just as the book was almost being snatched from my hands, the thing with Yahoo and Marissa Mayer came up.

She was worried about exactly what you're talking about, plus there were issues where people who were never there weren't as engaged.

Good for her that she had the guts to act on that. It'll be interesting to see what happens. Maybe the people who were brought back to the office were hopeless cases to begin with, and their minds are never going to be engaged by the work.

When I think about the story of the productivity revolution, the narrative I'm most familiar with, from Robert Gordon and others, is of waves of technological changes driving big productivity gains. In your telling, these technological changes are secondary to ...

Yankee ingenuity?

Yeah, basically. The attitude of the society.

The great driver for me is the prevailing individual values in the society. I don't believe that every change in values is of momentous importance, but by golly, the arrival of what Jacques Barzun called the modern era in 1500 right through to Kierkegaard and Nietsche and William James and Henri Bergson, that's not unimportant, for Pete's sake. What people think of as the normal way to conduct their lives is pretty powerful.

I had a little meeting with journalists yesterday afternoon. I thought it was a total disaster but everybody said it was fine. And the tendency was to talk about tax rates, and there was a ritual reference to regulation of course. I concluded the conversation by saying, Look, I think it took a momentous change in thinking, in attitudes and beliefs, to bring about the marvel of the productivity explosion in the 19th century. Likewise I don't think you can find the roots of slowdown in what happened to tax rates or economic policy more generally, or globalization. I think that suspect No. 1 has got to be that there was another gradual change in the balance between modern values and traditional values, and the power that traditional values gained in politics.

When you talk about modern vs. traditional values in this context, it seems to be mostly it's openness to risk and innovation vs. desire for security.

I would put it almost that way, but I wouldn't use quite those words. It's not as if people used to be afraid of those horrible risks and then they decided to gulp, like taking Castor oil, and swallow these risks and go ahead with their lives as best they could, these poor things. In my view they were drawn to it like a moth to fire. They were exhilarated by it, intrigued by it.

It's not right to think about it in terms of risk. It's exploration, it's discovery, it's voyaging into the unknown. And maybe that's perishable. Maybe that's part of the problem. Society can maintain this enthusiasm, maybe it can maintain it for a long time, but there's simply no guarantee that that enthusiasm will last. We certainly don't understand very well the dynamics of these attitudes and beliefs.

As somebody who spends a lot of time reading HBR and hbr.org, I see a lot of excitement about the new. And obviously out in Silicon Valley the enthusiasm for the new is pretty extreme right now.

They're great, and they're the best part of us. Unfortunately, they're practically pushed out to the ocean. I certainly hope that there's going to be a rebirth of this enthusiasm for the new, and I understand that it's very much present on the West Coast. But I don't think I see signs of a rebirth in the heartland of the country and in most parts of business. The way businesspeople talk, they talk about adaptation as if it were innovation.

[This led to a long discussion of the less-than-innovative ways in which economists have portrayed innovation through the years, and whether their depictions influenced business practice.]

The uncertainty that exists in an economy of dynamism got suppressed. If businesspeople needed a license to talk that way, they had it with the way economics was being discussed. I don't have a very good sense of what it was like to be at Harvard Business School as a student in the 1950s or 1960s.

It feels like the focus at the time was very much on managing something that was there.

Yes, how do you manage the company so it will be a little more efficient than the other guys? And now of course the whole takeover business, private equity, they too are perceived as going in to eradicate the inefficiencies that became encrusted around the management. There's nothing about innovation there.

So what are the policy recommendations? Can you conceive of any particular things that could be done to turn back what you see as this dangerous turn away from modernity?

We've got to do something about corporate governance in this country so that we don't have CEOs with expected tenures of four or five years or something like that. That just is so disastrous, it creates such a tilt toward short termism. And maybe somebody can figure out a way to remove the financial pressures on CEOs to hit quarterly earnings targets.

And then at the policy level, I got really interested in, well, Nancy Pelosi. She was on television advocating something or other, and I was sort of waiting for her to give at least a hint of what her thinking was of why this would be good for the country. What she said was her constituents wanted it. That was kind of the last straw. I began to think that, my God, the whole country seems to be fixated on getting benefits, from state governments, local governments, the federal government. It's not as if we're spending a huge percentage of GDP on it, it's not that. I think it's just that it seems so enervating. We want young people to grow up and come back and give us the world. We don't want them to think now life is going to be how much more in retirement benefits you can get from the city.

Has Maximizing Shareholder Value Gone Too Far?

By the People, Not for the People


In 1963, IBM CEO Thomas J. Watson published A Business and Its Beliefs: The Ideas That Helped Build IBM. The text listed the company's values in the following order: respect for the employee; a commitment to customer service; and achieving excellence. By 1994, when Louis V. Gerstner Jr. headed the company, he orchestrated an epic turnaround, putting shareholder value and customer satisfaction at the top of the list. Employees and community were at the bottom. The most recent two CEOs placed investor returns at the top of their priority lists.



So how did the company go from extolling and supporting employees to slashing jobs in order to make money for its shareholders? Jia Lynn Yang explores this trajectory, focusing on the 1970s explosion of free-market scholarly thought that has become the baseline for running a company in the twenty-first century. This, of course, has led to the implicit notion that CEOs work for the short-term benefit of their investors, not their employees, and will be rewarded with piles of cash and stock options in the process.



But is it actually working? Many people are concerned that we've adopted a mantra as fact without considering its long-term consequences for the health of the American workforce. "We don't build companies to serve Wall Street," Vanderbilt law professor Margaret Blair told Yang. "We build corporations to provide goods and services to a society and jobs for the people." Isn't that enough?

Alternate Title: Those Who Got Left Behind

The Truth About Marissa Mayer: An Unauthorized Biography Business Insider

You've no doubt seen this 22,000-word piece meandering about the internet, promising, per the scintillating title, revelations about Yahoo's CEO. True, there's a fascinating back story about Mayer's childhood, education, and career that provides important insight into how she's running Yahoo. But perhaps more interesting is the behind-the-scenes battle over the CEO-ship that pitted board member against board member in a fight to define the company’s future. Should the company prioritize media and content, competing with the likes of Disney and News Corp.? Or should it compete with Google and Microsoft on products? Obviously, the company went with the latter. But the near-soap-opera narrative of how that decision was made, and who got left in the dust, is engrossing — right down to the limo rides to a secret interview location. The photo Business Insider uses to identify said location, of course, is sourced from Google Street View (I can't be the only person who finds this hilarious).

It's All About Well-Being

Is College Worth It? Gallup

President Obama’s plan to rate colleges by data such as student debt and graduates’ earnings has stirred up talk about collegiate “outcomes” and what the purpose of higher education is or should be. But Gallup isn’t the least bit confused about the purpose of a university education. The point of those four years should be to get you a job you actually like doing. A job where you do what you’re best at, every single day. If you have that, you’re more likely to experience “career well-being,” which is the most important of the five elements of total well-being, the others being social, financial, physical, and community (you’re engaged with the area where you live). Brandon Busteed writes for Gallup that an analysis of graduates’ well-being would be a “real and meaningful measuring stick” for colleges. —Andy O'Connell

.mineallmine

The Great Internet Land Grab The New Yorker

When a 2011 decision from the Internet Corporation for Assigned Names and Numbers (ICANN) came down, widening the market for domain names, it seemed like step in the right direction. After all, simple, intuitive domains are almost impossible to find, unless you're interested in a prolonged battle with whatever weird entity owns the name you want. So are the new possibilities — like .cnn or .book — going to democratize things? Maybe. While "domain-name speculators" have been applying like crazy for every name under the sun — even Google and Amazon are in on the game, with applications for 101 and 78 names, respectively — there's a new system for deciding who gets what name.



Meet Innovative Auctions, a firm that holds private auctions to settle incidences of multiple entities’ wanting the same domains. It's basically eBay for dot coms, but with a twist: "Bid money is divided evenly among those who drop out along the way." This puts money in the pockets of those who bid often, regardless of whether they win. And the more money you have, the more likely you can buy the domains that matter.

Darn

Your Boss Won't Stop Spying on You (Because It Works) Bloomberg Businessweek

Sure, it seems creepy. But a new study from researchers Lamar Pierce, Daniel Snow, and Andrew McAfee "paints ubiquitous surveillance in a pretty bright light." Studying 392 restaurants that are part of five chains, the trio compared rates of theft and revenue at eateries with and without a software system that monitors the data from cash registers and other money-making devices. Those with the system experienced a 22% drop in theft and a revenue increase of 7%. Productivity also increased, to boot. So should this type of surveillance happen on a larger scale? Maybe not: A recent research roundup found that "indiscriminate monitoring fosters distrust, conformity, and mediocrity." What that says about the ethos of the restaurant industry, well… no comment.

BONUS BITS:

Mall Madness

Asia's Mega-Mall Boom Is Headed Toward Bust (Quartz)
The Ruthless Global Battle for Your Back-to-School Shopping Dollars (The Atlantic)
The Amazing and Ridiculous Tech from a 30-Year-Old Sears Catalog (Wired)

Will the Internet Destroy the Stock Market?

Last week, the NASDAQ exchange froze for three hours due to a faulty connection. On Monday, Europe's largest derivatives market shut down for an hour because of a glitch. Last month, 14,000 people in rural Iowa lost internet access after a minor car crash crushed a cable. In 2011, the entire country of Egypt had a total internet blackout after officials ordered the country's ISPs to flip a few switches; the Syrian government is now doing the same. In late 2006, most of Asia had the same experience after a minor earthquake cut a transatlantic cable.

In our era of smartphones, iPads, and Wi-Fi, it is easy to forget that the internet is bound by physical infrastructure. Massive servers housed in high rise buildings, transoceanic fiber-optic cables, and myriad routers and switches crisscrossing the globe have transformed not just how we communicate, but almost every aspect of modern society. Generally, this is a good thing. But our increasing reliance on the benefits of this vast network means we must also acknowledge the internet's limits and the potential consequences of exceeding those limits.

All networks grow until reaching a breakpoint, a point at which the carrying capacity of the system is exceeded. The result is a crash. We see this in nature (ant colonies, for example, only grow to a certain point before retreating), in the brain (neurons multiply exponentially in a child's brain but shrink down to a fraction of their maximum level by adulthood), and in technological networks (remember MySpace?). Now that the world is dependent on the internet, economies and markets are bound by these limits as well. Pushed past the breakpoint, all systems risk collapse.

The stock market in particular is at risk of hitting a major breakpoint. The stock market was intended to be a long-term vehicle for companies to raise money and for investors to reap the rewards after their money was utilized to grow those companies. Investors periodically assessed the health of their portfolios and made decisions to buy or sell certain stocks based on past success and an educated guess of future performance. Over the long term, markets are efficient and generally increase in value. In the short term, however, there are market inefficiencies and fluctuations, which traders speculate on for short term gains and losses.

This type of short-term trading is tantamount to legalized gambling. While it has been around since the beginning of the stock market system, in the 21st century, it has been taken over by internet technologies and accelerated beyond recognition. High frequency traders use complex algorithms to exploit micro differences in trading prices over time — not years, months, or days... but seconds and milliseconds. Admittedly, fund managers cannot even explain the algorithms because the networks learn as they go and change algorithms accordingly. The computers far exceed human ability to compute, calculate, and predict, and they pick up on and exploit tiny factors that no human brain can recognize. I would go as far as saying that there is actually an artificial intelligence at work here, which none of us fully understand.

Increasingly, winners at this new stock market game are determined not just by the fanciest algorithms but also by the speed of the hardware that provides access to the information needed to plug into the algorithms. The process is already fast — news of an event goes from the wire to a trader's computer network in milliseconds. But the difference between recognizing and reacting to that data nanoseconds faster can mean billions lost or gained. These tiny fractions of a second (much, much faster than a blink of an eye) are so important that some traders have gone to great lengths to improve their speeds. Many have purchased dedicated internet cabling, some have gone so far as to move their computer networks to be in close physical proximity to the data centers of the stock exchange and news outlets, paying hundreds of millions of dollars for direct access.

Untold fortunes have been made as a result. But problems have surfaced. In June, Thomson Reuters came under fire for allowing its elite clients to see consumer confidence data 5 minutes and 2 seconds before the general public gained access. On one day — May 17, 2013 — over $100 million changed hands before the rest of the public even knew an event had occurred. This event didn't lead to a crash, but it could have. That is what happened a few years prior when high frequency trading contributed to the May 6, 2010 "Flash Crash" in which the Dow dropped 1000 points in minutes, only to recover a few minutes later. Computer networks are working faster and more efficiently than the markets can bear. Is this a foreshadowing of what is to come?

The stock market was meant to work as a long-term system. Applying these short-range game tactics — and make no mistake, anytime you're trading stocks on a short timescale, you're playing a game — is risky, especially at the speed at which we're now moving. A rational solution would be to limit the amount of trades any individual or group could do on a single stock. But there is very little appetite for that. Yet without slowing down the network, we are allowing it to move towards a cataclysmic breakpoint, perhaps leading to an implosion of the whole stock market structure or the global economy itself.

Anytime a network goes through a breakpoint, there are two possible outcomes. More often than not, the network implodes and dies. 90% of all animal species never make it through a breakpoint; the survival rate is even worse for new businesses and technologies. But systems leveraging a network, those relying on existing network infrastructure, usually fare better. The stock market is such a system. So long as we do not allow it to be abused, our markets will grow stronger and become more efficient. To do so, however, we must paradoxically slow down the system to allow for maximum efficiency.

Don't Let Them Underestimate You

We all hope our resume and experiences will speak for themselves. But a friend of mine — a 40 year-old former special agent and combat veteran — recently emailed me about a persistent problem. "When I contact leaders in my industry, they almost always agree to talk," he told me. "But some have been treating me as if I were an undergrad." One asked if he was working on a "class project," while another suggested he "thank his parents" for sending him to graduate school (he paid his own way).

Those responses might be extreme, but my friend's situation isn't: many of us are underestimated by the people we come into contact with. With co-workers or others we see regularly, we can overcome negative perceptions through hard work and behavioral change. But how do you make a strong first impression on someone you're just meeting - and avoid falling into their unthinking mental frameworks (such as "anyone who asks for an informational interview must be an inexperienced student")?

I've certainly been there. A few years ago, I met a retired professor from a top business school. At the time, I had already taught at one business school and hoped to teach more. I thought he might be able to offer advice about how to break in at his school. He waved me off dismissively. "Every executive wants to teach at our business school," he told me. "My best advice is to apply to the doctoral program and maybe you could be a TA."

A year after that, I connected with an executive who ran a respected conference. I was thrilled when, at the end of our meeting, he introduced me to his employee, who was in charge of recruiting speakers. "I wanted to introduce you two — you should follow up," he said. I assumed the intro from her boss would have paved the way for an invitation to present, but just minutes into our follow-up meeting, I realized she literally knew nothing about me and had no idea why I was there. Suddenly, I was thrust into an unexpected "prove yourself" mode. At the end of the conversation, she turned to me: "I'm always looking for good speakers," she told me. "If you can think of anyone, let me know."

We all hope our merits will be recognized — and it's a jarring comeuppance when they're not. Some people begin to doubt themselves: should I actually be going back to graduate school? Others get angry at the people who have failed to see their potential (or their actual demonstrated ability). But the best plan, of course, is to ensure we're vigilant upfront about conveying our expertise — and that if we falter in an encounter, we move quickly to correct those misimpressions.

Before you meet a new contact, make sure they're aware of your background and expertise. I assumed the conference organizer had been fully briefed by her boss, but it was a costly mistake. She obviously could have been a lot more curious or organized, but setting the tone of the meeting was my responsibility, and I dropped the ball. Instead, as the famed psychologist Robert Cialdini advised when I interviewed him for my book Reinventing You, you should "send a letter of introduction that says, 'I'm looking forward to our interaction on Thursday on the topic of X, and my background and experience with regard to X are as follows.'" Says Cialdini, "It's perfectly appropriate to say those things in a letter of introduction, but it's not appropriate as soon as there's a face-to-face interaction because you look like a boastful braggart and a self-aggrandizer." The letter of introduction establishes your authority before you even step in the room, which would have helped me immeasurably.

During the meeting, have a number of anecdotes ready that demonstrate your expertise. You can likely predict the questions they'll ask; for each one, identify a story that showcases your abilities. If someone asks my friend about his "class project" and gets a response that instead cites his combat experience, it may (finally) sink in that he's not a regular student seeking career advice.

After the meeting, if you suspect they haven't fully grasped your potential, don't push it. I didn't argue with the business school professor that I actually was qualified to teach, or with the conference organizer that I was an excellent speaker. When it's clear someone has pigeonholed you, those protestations come off as slightly pathetic. Instead, recognize that you're in the long game now, and you need to change their opinion of you over time. If the relationship is worth cultivating, keep in touch and periodically update them with news about your progress ("just thinking of you, since I recently spoke at the XYZ conference"); if you have mutual friends, let them talk you up. They need to "discover you" and your value for themselves.

Meanwhile, don't let their limited judgment of you get you down. In the years following the dis from the retired business school professor, I've secured teaching engagements at four additional top business schools; I'm actually just back from guest lecturing at his own university.

Someday, if we're lucky, we may achieve enough recognition that our reputation always precedes us, and people are always thrilled to do business with us. Until then, there will be people who don't have a clue what we can offer. To advance in our careers and get the respect we deserve, the only solution is to recognize it's our responsibility to ensure they find out.

Sunlight Makes You More Willing to Take Risks

A study at an outdoor parking lot in Singapore shows that the sunnier the weather, the more severe are drivers' parking violations, and an analysis of 40 years of Major League Baseball data reveals that stolen-base attempts are more likely during day games than night games, says a team led by Nicholas Reinholtz of Columbia University. Humans' tendency to take greater risks while the sun is shining may have evolved as an adaptive behavior, the researchers say.

Office Politics for the Pros

Karen Dillon, author of the HBR Guide to Office Politics, talks with Dorie Clark, author of Reinventing You.

Download this podcast

A written transcript will be available by September 9.

The Dangerous Tension Between CMOs and CIOs

Business is largely about competition and, even within organizations, a healthy dose of rivalry between colleagues can be a good thing. However, a survey just conducted by Accenture Interactive (see The CMO-CIO Disconnect) points to a downright unhealthy relationship in many C-Suites which can do nothing but damage to firms.



At a time when many executives say that improving digital reach will be a significant differentiator for their companies, our research shows that two of the most important digital leaders — the Chief Marketing Officer (CMO) and the Chief Information Officer (CIO) — do not trust each other, understand each other, or collaborate with each other. Thus, even though both marketing and IT professionals say they want to be more collaborative, meaningful collaboration is unlikely to occur.

That is very bad news for their businesses and, not incidentally, for their own careers. When IT and marketing departments work at cross-purposes, the results are inefficiencies and mishaps and it is customers who suffer. Potential buyers simply don't have the time or energy to do business with a company that makes things harder for them.

To begin to mend the CMO-CIO relationship, it's important to understand the source of each side's frustrations. CMOs' answers to our survey questions make it clear that they view IT as an "execution and delivery" provider, instead of as a strategic partner. CMOs do not believe they are getting fast enough turnaround on projects and adequate quality from the IT departments. Because many CMOs do not believe they are getting the service they want from their IT departments, many bypass the IT department and work with outside vendors. Forty-five percent of marketing executives say they would prefer to enable marketing employees to operate data and content without IT intervention.

For their part, IT executives believe marketers make promises they can't keep and do not provide them with adequate information on business requirements. The CIOs believe the marketing teams often do not understand — or appreciate — data integration or IT standards. Nearly half (49 percent) of CIOs say marketing pulls in technologies without consideration for IT standards. Forty-seven percent say the marketing team lacks understanding of data integration.

Surely there is truth to both sides' complaints. But why is it that two leaders focused on the same ultimate goal cannot make better progress in working together? For context, consider how the jobs of the two departments have changed over the past few years. Traditionally, marketers were focused mostly on creative and brand strategies, but now they are tasked with turning Big Data into relevant customer experiences via multiple channels and throughout the new decision lifecycle. On the IT side, the teams are being asked to manipulate vast reams of data to analyze every product, customer, or transaction and to adopt new technologies for mobile, social media, etc. But the IT department must also maintain strict privacy and security of data and technology, as well as follow internal protocols. IT focuses on cost takeout, increasing efficiencies, and scale, while marketers strive for ways to respond (or stay ahead) of the ever-changing demands of consumers, who are hungry for more relevant and dynamic experiences, Although both IT professionals and marketers play their parts in driving business growth and innovation, their approaches are very different.

Worse, each side suspects that the difference is even greater than it is. CMOs assume that CIOs' approaches are not only deep-rooted but contradictory to their own, and that their own perspective is undervalued by their counterpart.

CEOs and others in the C-suite should not turn a blind eye to this tension, hoping for it to resolve itself. It is crucial for companies to instill more collaboration and understanding across the functions. Here are five suggestions for supporting a CMO-CIO relationship that will ultimately benefit customer experience and drive sales.

Identify the CMO as the "Chief Experience Officer." This is more than simply a change in nomenclature It is a constant reminder to the CMO that the job doesn't end with branding and advertising. The CMO must design and drive a customer experience that is consistently first-rate, at every touch point within the company — a goal that lays more emphasis on the role of IT and the need to reach a deeper understanding.

Signal that IT is the strategic partner to marketing. The CIO cannot be viewed as only the chief technology platform provider; the role must be elevated to a strategic member of the C-suite.

Get the two leaders working from the same playbook. Already, CIOs and CMOs spend more than 30 percent of their respective budgets on technology. It is time for them to agree on key business levers for marketing and IT integration, such as access to customer data and speed to market along with security, privacy, and standardization.

Change the skill mixes. Make sure the marketing department becomes more tech savvy and the IT department better understands marketing. Again, coming together around the consumer and customers will help to breakdown internal silos and align agendas. Upgrading their skills will help both departments make better decisions about technology and understand its impact on business outcomes.

Develop trust by trusting. It is time for leaders in organizations to extend their trust to — and accept it from — business units beyond their own.

You may never turn your CIO and CMO into the best of friends, but you should be able to convince them they are natural allies. If a little competitive rivalry gets them both to bring their best games to work, so be it. But everyone needs to realize they are part of a team, their job is to make it stronger, and the real competition is out there in the marketplace.

How to Manage Someone You Don't Like

Everybody complains about incompetent bosses or dysfunctional co-workers, but what about irritating direct reports? What should you do if the person you manage drives you crazy? If the behavior is a performance issue, there's a straightforward way to address what's irking you — but what do you do when it's an interpersonal issue? Is it possible to be a fair boss to someone you'd avoid eating lunch with — or must you learn to like every member of your team?

What the Experts Say

Of course, your job would be a whole lot easier if you liked everyone on your team. But that's not necessarily what's best for you, the group, or the company. "People liking each other is not a necessary component to organizational success," says Ben Dattner, an organizational psychologist and author of The Blame Game. Robert Sutton, a professor of management science and engineering at Stanford University and the author of Good Boss, Bad Boss and coauthor with Huggy Rao of the forthcoming Scaling Up Excellence, agrees. According to Sutton, "there's a list of things that make you like people and there's a list of things that make a group effective, and there are very different things on those lists." It's neither possible — nor even ideal — to build a team comprised entirely of people you'd invite to a backyard barbecue. But there are real pitfalls to disliking an employee. Consciously or unconsciously, you might mismanage him or treat him unfairly and fail to see the real benefit he can deliver to your team. Here's how to get the most out of someone you don't like.

Don't assume it's a bad thing

Sure, you may grit your teeth at her lousy jokes or wince at the way he whistles at his desk, but feeling less-than-sympatico with your direct reports might not be the worst thing. "From a performance standpoint, liking the people you manage too much is a bigger problem than liking them too little," says Sutton. The employees you gravitate toward are probably the ones who act nice, don't deliver bad news, and flatter you. But it's often those who provoke or challenge you that prompt new insights and help propel the group to success. "You need people who have different points of view and aren't afraid to argue," says Sutton. "They are the kind of people who stop the organization from doing stupid things."

Focus on you

Still, the days can feel very long when you're constantly dealing with someone you don't like. It's crucial to learn how to handle your frustration. Rather than thinking about how irritating the person is, focus on why you are reacting the way you are. "They didn't create the button, they're just pushing it," says Dattner. He suggests asking yourself the following questions:

Is the problem the individual or someone they remind me of? "You can have a competent person who looks like your unkind aunt and suddenly she can do no right."

Am I afraid of being like this person? If your direct report constantly interrupts people, for example, and you worry you do too, you may react more strongly.

Are they a member of a group that I have issue with? This question gets into a whole host of prejudices and possible legal issues, but you need to be honest with yourself about any hidden biases you may have. "Try to unpack what this person represents to you."

"You don't have to go into therapy to figure it out but be honest with yourself about what situations or attributes make you most irritated," Dattner says. Once you've pinpointed the triggers that might be complicating your feelings, you may be able to soften or alter your reaction. Remember: it's far easier to change your perspective than to ask someone to be a different kind of person.

Put on a good face

Everyone wants their boss to like them. Whatever your feelings for your employee, he will be highly attuned to your attitude and will presume that any disapproval or distaste has to do with his performance. The onus is on you to remain fair, impartial, and composed. "Cultivating a diplomatic poker face is important. You need to be able to come across as professional and positive," says Dattner.

Seek out the positive

No one is 100% annoying. Yet it's easy to see the best in your favorites and the worst in people who bother you. "Looking for some of the flaws of your stars and the redeeming attributes of the people you don't like can help you be more balanced," says Dattner. Search for what you like about the person. "Assume the best, focus on what they're good at, and how they can help your team," says Sutton. He suggests you regularly ask: Given their talents and their limits, what can they do that would be best for the team? Can the over-achiever shoulder some additional projects? Might the slow-talker's snail-paced delivery spur the whole team to reflect more before speaking?

Keep your bias out of reviews

When someone irks you, you need to be especially vigilant about keeping your bias out of the evaluation and compensation process. Dattner recommends asking yourself: "Am I using the same standards that I use for other people?" If you find you're having trouble being fair, Sutton suggests seeking counsel from another manager who is familiar with the employee's work. Ask for frank feedback on whether your evaluation matches the outsider's. You might even ask the person to play devil's advocate, to make the case for the employee's strong points. "Leadership is mischaracterized as a solo adventure. It's much more of a team sport," says Sutton.

Spend more time together

This might sound like the last thing you want to hear, but it might help to give yourself more exposure to the problem employee. Sometimes strong medicine is the most effective cure. Sutton cites studies that demonstrate how collaboration on difficult tasks tends to build affinity. "Over time, if you work together closely you may come to appreciate them," he says. Consider staffing him to your toughest project, or asking him to serve as your right-hand person on an important initiative. Most importantly, remember to keep an open mind. "Your favorite employee today might become your least favorite tomorrow. The people you like may become untrustworthy tomorrow," says Dattner.

Principles to Remember

Do:

Be honest with yourself — pinpoint the triggers that might be complicating your feelings

Check your bias in evaluating the employee's performance by getting an outsider's opinion

Keep an open mind — your perspective may change

Don't:

Assume that disliking someone is a bad thing — differing points of view are critical to a team's success

Let your distaste show — everyone wants their boss to like them

Avoid working with the person — collaborating together on a difficult task may positively alter your relationship

Case study #1: Hire "allergy shots"

Linda Abraham, the co-founder of comScores, a leading digital analytics company, established her organization on a simple premise: hire people you respect, not necessarily people you like. Since starting the business in 1999, she has intentionally brought in people she didn't like but thought would be good for the team. "They're almost like allergy shots for your organization," she says.

A few years back, she hired Dan* against the wishes of other people on her team. Even during the interview process, he rubbed people the wrong way. But Linda thought he had the right skills and experience. He came from a large tech company and tended to talk a lot about scale, which many people interpreted as advocating for bureaucracy — a no-no in the start-up culture.

For the first six months, he made regular observations about one of the company's products and how it could work better. "When I really dug into what he was trying to say, I was impressed," Linda says. While he wasn't diplomatic in his comments (he often described things as "dumb"), he was insightful. "We ended up scrapping the job we hired him for and had him take on the improvements he suggested," she says.

Even in the new role, he wasn't likable. But Linda tried to focus on the content of what he was saying rather than the way he was saying it, and she coached others to do the same. She also invested time in helping Dan understand how he was coming across and what he could do to alter his style. Eventually her attitude toward him changed. "I've come to like him quite a bit," she says. "He's ruffled more than a few feathers along the way, but he's been promoted and has really crushed it."

Case study #2: Keep your bias in check

Kevin Niehaus, a business manager at a large children's hospital, inherited a team of employees when he first took on the role. One member of the group, Chris*, always rubbed him the wrong way. "He was the source of 90% of the drama in our unit," Kevin says. "It got to the point where I would discredit his ideas because I did not like him."

One day Chris came to Kevin upset. "He wanted to know why I didn't trust him. I quickly realized that I had let my emotional reaction get in the way of being his manager." Kevin decided to change his approach; he needed to be more objective. Going forward, he intentionally paused after Chris irked him and asked himself, "Would I care if this was anyone else?" Often the answer was no and he learned to let certain things go. Using Chris's initial confrontation as a starting point, Kevin also started giving him honest feedback about his behavior, which in turn "cut down on some of the dramatics." Over time, they were able to develop a trusting relationship where Kevin kept his emotions in check and Chris felt heard.

*not their real names

Solving the Looming Talent Shortage in the Energy Industry

These days, each passing season seems to mark a new weather record, whether hottest year in the US, driest drought in Australia, or a record heat wave in South Korea. The trend towards more extreme weather appears to be continuing around the globe.

So just when electric systems need to operate flawlessly — whether to power air conditioners, pump water, or heat homes — long-term challenges to power grids are multiplying. From the US to Europe and Asia, electricity players are facing a similar set of human and physical challenges. The unprecedented loss of highly-skilled, senior workers is compounding challenges posed by aging infrastructure, rising power demand, and climate stress.

While the labor challenge is especially stark in the U.S., utility systems in most advanced economies are facing similar demographic dynamics. New workers are not entering the market as fast as veterans — particularly engineers — are retiring. In the U.S., for example, a backlog of baby-boomer retirees is expected to turnover upwards of 40 percent of utilities' 400,000-strong workforce, according to a study by the Task Force on America's Future Energy Jobs produced by the Bipartisan Policy Center (BPC). The need for digitally savvy technical hires is especially pronounced. By 2030, the BPC predicts, utilities in the United States will need to hire 150,000 additional workers in information-technology intensive roles.

The consensus solution to the infrastructural challenges is to continue the build-out of a smarter, self-healing digital grid (which President Obama mentioned in his June 25th speech on climate change), while integrating new technologies with the old. But solving the workforce problem is inherently part of this process. A digitally-skilled workforce is vital to help deploy advanced digital technologies that can streamline and automate grid operations.

The industry's most competitive companies are using this generational shift as an opportunity to transform their organizations, aggressively recruiting for digital fluency at all levels — from research engineers to midlevel customer service managers. To this effect, we've seen them implementing programs that cultivate the following vital milestones on the way towards a smarter grid:

Grooming more data scientists. Utilities are taking a crucial first step of adding sensors and digital meters across their networks. Once in place, this new generation of devices can feed a deluge of data, which presents huge opportunities to discover early signals that can prevent faults and increase grid reliability. Data scientists are vital in analyzing data not only from these devices, but also from customers' signals in the form of unstructured data from posts on social media sites, so technical troubles can be detected early and communicated. Behind company walls, data scientists' ability to mine operational data is helping to develop digital repositories of workers' best practices, and helping fewer workers do more, via collaboration tools.

Utility companies are now developing these advanced data skills through public-private initiatives. For example, the Pittsburgh-based University Energy Partnership is working with the Energy Department's National Energy Technology Laboratory and URS Corp. Collaborating with five research universities, the program is cultivating engineering, software, and material science research projects that address key grid challenges, from transmission and distribution problems to computer-aided simulation of carbon capture.

Getting the attention of the next generation. Other utilities and businesses are partnering with local colleges to raise awareness about smart grid job opportunities and start training talent to replace those departing boomers. In 2010, Florida Power & Light estimated that 65 percent of its workforce was near or eligible to retire. Now their Gateway to Power program ranks among the largest of the 52 smart grid labor training programs seeded by the 2009 Recovery Act. That same year the utility partnered with seven regional colleges and universities to promote a series of programs focused on ensuring the graduates had the knowledge and skills to design, plan, construct, operate, and maintain a modern electricity delivery system, including power system infrastructure and information systems.

Encouraging trade skills. Traditional vocational and technical education programs are also part of the answer. San Francisco-based utility Pacific Gas & Electric (PG&E), which is facing the potential retirement of two in every five of its workers by 2015, is collaborating with colleges, vocational schools and universities across the state, together with the Gates Foundation, and other public and private partners to train tomorrow's workers. The result is PG&E's PowerPathway program which has already graduated hundreds of new workers with skills that span from linemen to advanced power engineering. The program has also helped PG&E's current staff to upgrade their skills.

August 14th marked the tenth anniversary of the US's worst-ever blackout, a grid failure that left more than 50 million North Americans in the dark for days. While experts agree the grid has improved since then, the economic toll still looms according to a recent White House report. To avoid these costly disruptions, investment in both the workforce and the infrastructure is a rising imperative around the world, both in mature markets such as North America, Western Europe as well as the growing economies such as Latin America, Africa and Middle East.

A new generation of smarter energy technologies, coupled with a workforce that is just as digitally savvy, holds great promise to ensure reliability of the grid, decrease economic losses due to power outages, and meet the world's growing demand for power. There is time, technology, and will to avoid this fate, but the clock is ticking.