Harvard Business Review

January/February 2016

Annotated table of contents

1. Adi Ignatius, The softer side of performance

Adi Ignatius, the editor-in-chief of HBR, highlights the four articles in the spotlight section of this issue dealing with the softer side of performance.

Idea Watch

2. HBR Team: How unicorns grow

This is a summary of a research report by Play Bigger, a Silicon Valley consultancy, also available in full though a link in the HBR article and here: https://playbigger.co….

The report tackles some topical questions about the financing of start-ups. There is a concern at the moment in Silicon Valley and beyond that the large number of start-ups valued at $1 billion or more, the so-called unicorns, is perhaps creating a bubble. According to this research, the fast growth of some start-ups is due to some degree to (dangerous) investor optimism, but it is possibly better explained by the fact that services and products get discovered and adopted much faster now, say via Google Play or Apple Store, than used to be the case. Interestingly, the report also discusses the link between the moment when companies go public and their prospects for growth after the initial public offering (IPO). Ideally, private companies should schedule IPOs before exhausting their more sizeable opportunities for growth.

3. Scott Berinato: To stop bad behavior display a virtuous quote

Professor Sreedhari Desai carried out lab research and field work in India, finding that flagging up one’s moral commitments, through virtuous quotes in emails or within the work space, is an effective cue: it tells others that we are unlikely to cooperate in carrying out a dishonest act. Often, we are no longer asked. What kind of quote works, and how, may depend on the culture, but it is heartening to see that such signals could regulate behaviour.

4. HBR Team: How to make extreme numbers resonate

Three examples of visualisation for extremely large numbers (18 billion coffee pots), extremely small numbers (3 in 10,000) and complex flows (thousands of people leaving and joining US cities) are offered here.

How I did it…

5. Blake Mycoskie: The founder of TOMS on reimagining the company’s mission

Blake Mycoskie founded Shoes for Tomorrow in 2006, combining idealism and enterprise: for every pair of shoes sold in the US, another would be donated to a needy child in the developing world. The ethical ‘why’ behind the enterprise caught the imagination and the company developed very fast, reaching $300 million in revenue in 2012. Success and a loss of sense purpose came together however and at this point Mycoskie decided to take a sabbatical from the company. He physically moved to a different part of the country to consider the underlying personal and business dynamics that had brought him to this point. Reinvention followed. I won’t give away what happened next, but I will say that the writing is engaging and insightful about the deeper springs of long-term business success.

The Big Idea

6. Martin Reeves, Simon Levin, Daichi Ueda: The biology of corporate survival

A blue-sky thinking article, it draws on a book on complex adaptive systems in nature, by Simon Levin, Fragile Dominion. It argues that ‘a paradigm shift in managerial thinking is needed,’ as corporate life-spans shorten and corporate mortality becomes an increasing threat. Images and metaphors of natural eco-systems broaden the imagination and help us to see connections between areas we normally compartmentalize, such as the design of systems and the challenges of management. Recommendations offered here tackle both. In the first category, the authors discuss the importance of system features: heterogeneity, modularity and redundancy. In the second, managerial advice is equally strategic: expect surprise but reduce uncertainty; create feedback loops and adaptive mechanisms; foster trust and reciprocity in the wider business ecosystem.

Spotlight: The emotional organization

7. Sigal Barsade and Olivia A. O’Neill: Manage your emotional culture

Here is the rare article that focuses directly on the emotional reality below the surface of the organizational life. The concept of emotional culture is defined as ‘the shared affective values, norms, artifacts, and assumptions that govern which emotions people have and express at work and which ones they are better off suppressing.’ The concept is then put to work to help us begin to notice and define the emotional culture of an organization, as manifested in the ‘micromoments’ of daily life. Clearly, organizations and groups can have a culture of joy, of companionate love, of fear and so on. Cultures could also attempt to balance two or more dominant emotions, such as joviality and companionate love. Importantly, emotional cultures can be actively managed and the authors offer here some very good pointers for where you might want to start: harness what people already feel; model the emotions you want to cultivate; fake it till you make it; cover all levels of the organizations (but start at the top for best results).

8. Adam Waytz: The limits of empathy

Waytz explains that empathy is a limited resource, it is very hard work after all, and can have some negative consequences as it is zero-sum, eroding ethics. By empathizing with some people, taking their side, it becomes more likely that we will be aggressive towards others, not always a good idea. Recognising these limits of empathy can allow us however to find more effective ways to husband this scarce resource. We can split up the work. We can make empathy less of a sacrifice. We could allow people not to empathise and give them permission to be self-interested as needed.

9. Rob Cross, Reb Rebele and Adam Grant: Collaborative overload

Have you noticed how being helpful and competent often backfires? The best helpers can quickly get overloaded, leading to bottlenecks for the organization and alienation for them, as they begin to experience a sense of lack of fairness. Especially since being helpful is not always a requirement for getting ahead in one’s career. While drawing attention to the dysfunctional potential of collaboration, the authors also suggest some practical ways to counteract the downsides, including restructuring work and rewarding effective collaboration more consistently.

10. James R. Detert and Ethan R. Burris: Can your employees really speak freely?

There are two main sets of reasons why employees may choose not to speak freely: they are afraid of repercussions or they may feel it is futile to try. Worryingly, some of the means devised to encourage openness, such as anonymous surveys, may actually reinforce the message that it is not ok to speak up. If you want to take advantage of the wisdom of the people in your organizations, you will have to encourage constructive contributions and criticisms actively. Techniques to create a more vocal culture and open up those crucial channels of communications are presented here, with examples: make feedback a regular, casual exchange; be transparent; reach out; soften the power cues by putting yourself on their territory through management by walking around; avoid sending mixed messages; be the example; and close the loop.

Features

11. Roberto Verganti: The innovative power of criticism

Tapping into the wisdom of the people in your organization might be useful in another way, too. In every organization there might be some people who are thinking about alternative ways of constructing a product or delivering a service, about novel value propositions more appropriate to changing circumstances. In the process devised by Verganti for innovation though criticism, working with and nurturing such ideas is the crucial starting point. Then, he suggests, set up pairs of such insider innovators to sharpen the focus and develop the idea in a nurturing environment. Further development and criticism, in a wider circle and then through the involvement of outsiders can prove a valuable path towards designing new products and services. Examples include new value propositions around home thermostats, furniture, game consoles and cars.

12. Michael Luca, Jon Kleinberg, and Sendhil Mullainathan: Algorithms need managers, too

Algorithms are extremely literal and they do not explain how they have arrived at their results. Understand these limitations and you begin to appreciate how important it is to think through the tasks you ask algorithms to perform and to interpret their results carefully. The authors recommend us to be explicit about all our goals, to choose wide and diverse data sets and to remain alert to the fact that correlations established by algorithms are not the same as causal explanations. Otherwise, as eBay has found, you may be paying for an advertising campaign that will reach only the people who already know about your products and services; or you may be unable to use the results to answer your business question because the enquiry you set the algorithm to investigate is too narrow.

Experience

13. Sydney Finkelstein: Secrets of the superbosses

Superbosses are bosses who know how to nurture and launch talent into extraordinary career trajectories comparable to their own. Based on extensive research on tens of such bosses across a number of industries, Finkelstein distils some of the common techniques and behaviours they use to tackle common tasks. In hiring, they tend to go for unconventional candidates, focus on intelligence, creativity and flexibility, look for unlikely winners, adapting the job to fit the talent, and accepting the need for people to move on. Their leadership is hands-on, setting high expectations, being a master, encouraging step-change growth and staying connected. There is plenty of insight here about how to bring out the best in people and that is a talent that anyone would do well to cultivate.

Case Study

14. Ram Subramanian: When tragedy strikes your supply chain

A case study about a clothing company in the US whose Bangladeshi supplier collapsed two weeks before the launch of the new season; it highlights both the ethical and business considerations that come with global supply chains.

Review article

15. Gretchen Gavett: Generations united

Do the problems of management differ depending on employee age cohorts? Three out of the four books reviewed here try to tease out specific implications for the management of Millenials (born late 1970s – mid-1990s) and the other focuses on Gen Z.

Life’s work

16. Alison Beard: Interview with Neil deGrasse Tyson

Neil deGrasse Tyson is an asthrophysicist, director of the Hayden Planetarium in New York, and a media personality. He talks about balancing tasks for extreme productivity: good use of interstitial time seems crucial. No complainer despite his underprivileged background, he says that it is enthusiasm and love for your subject that might just give you the deep tanks of fuel you need to overcome the inevitable difficulties in your path.