Building Resilience – In Individuals and Organizations

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Paul was a successful executive whom I met a few times, and over the course of several conversations, learned his life story. Abandoned by his drug-afflicted mother, he grew up in an orphanage until he was adopted by a couple when he was five. Paul was sexually abused, and at thirteen he left home and stayed with friends until he finished high school. Eventually he got a scholarship to go to college and found his passion in engineering. When I met him, he had become a senior executive, in one of the major automobile companies and was widely respected and admired as an empowering leader.

Take Penn State’s former running back Saquon Barkley, who has just started his NFL career. His father had a drug problem and was in and out of jail. While his mother uprooted him when he was four, along with his four siblings, so they could have a better life. Despite it all, Saquon has graduated and by all accounts is thoughtful, self-aware and very personable.

Many others in Paul’s and Saquon’s situation might not succeed under similar circumstances. Psychologists and management theorists attribute part of their overcoming all these obstacles to “resilience”. Yes, resilience seems to be a term often invoked these days. Even the U.S. military has recognized the importance of resilience and has built this concept into some of its training.

Field Manual 6-22 points to resilience as a critical leadership attribute: “Resilient leaders can recover quickly from setbacks, shock, injuries, adversity, and stress while maintaining their mission and organizational focus.” (Sewell, 2011).

There have been a number of research studies attempting to identify the characteristics of resilient people. Marston and Marston (2018) write that they have identified six characteristics of what they refer to as Type R:

Adaptability

A healthy relationship to control, continual learning, a sense of purpose, leveraging support, and active engagement.

Cacioppo et al. (2011) introduced an additional aspect of resilience with their concept of social resilience, which they define as “…the capacity to foster, engage in, and sustain positive relationships and to endure and recover from life stresses and social isolation.” (p. 44). Within communities and organizations, this collective resilience can be very powerful; workers who feel they are part of a larger whole can find strength when dealing with adverse working conditions or challenging situations.

Rodin (2014) suggests that resilience is “the capacity of any entity – an individual, a community, an organization, or a natural system – to prepare for disruptions, to recover from shocks and stresses, and to adapt and grow from a disruptive experience.” (p. 3) She uses the term “resilience dividend” as the capacity to be more adept at managing disruptions and in creating new opportunities.

Coutu’s (2002) research has concluded that resilient individuals (and organizations for that matter) have three characteristics: a grounded view and acceptance of reality, a deep belief that there is meaning in what they are doing and what they are going through, and an uncanny ability to learn, adapt and improvise.

Let’s take her first characteristic, a grounded view and acceptance of reality.

In my interpretation, this seems to be unrelated to optimism or pessimism. It simply means that you are unflinching in your view of what is going on (in his book Good to Great, Jim Collins explains this brilliantly). This is different from optimism, which is what others like Seligman (2011) argue is one of the key drivers of resilience. I tend to agree with the social critic Barbara Ehrenreich (2009), who took a cynical view of optimism and suggested that this was nothing more than wishful thinking. In my opinion, resilience reflects realism about the present, but optimism about the future.

A great example is Best Buy. A few years ago, many would have predicted, with the rise of e-commerce and monster competitors like Amazon, that Best Buy would eventually close shop, like Circuit City did a few years earlier. Best Buy was losing money and, in 2012, the CEO resigned in the wake of a scandal involving a romantic relationship with an employee. New CEO Herb Joly recognized the challenges; turning the company around was not going to be easy. One of his first decisions was to announce that he was going to match Amazon’s prices. Given Best Buy’s uncertain financial situation at that time, this was a bold move. Then he and his team tackled customer service by fixing delivery issues so that customers ordering on-line would receive their orders from the Best Buy location that could deliver their orders fastest rather than from centralized warehouses. They also offered free in-home consultations to customers who were considering making some purchases. Joly also reinstated employee discounts (a popular benefit for its workforce) and avoided mass layoffs. Today, Best Buy’s stock price continues to rise, and worker morale is up. In fact, Samsung, Apple and Microsoft have signed deals with Best Buy to feature their products on dedicated kiosks in branded areas within the store.

Making meaningful sense is what I would call Coutu’s second characteristic.

The classic example, as many know, is Victor Frankl’s experiences in a concentration camp, as described in his masterpiece, Man’s Search for Meaning. Bennis and Thomas (2002) describe these experiences as “crucibles” that leaders go through (especially with traumatic and negative experiences) where they somehow find meaning in these experiences and become transformed by them. In organizations, we see employees who get inspired by the purpose of their work, and what their organization stands for. Some of these organizations have created mission statements that are intended to be inspirational, although for many, the reality does not live up to the promise. Nonetheless, organizations view this as a powerful motivator. For example, despite the negative press about the pharmaceutical industry, I know many employees in these companies who view their work as truly meaningful and of benefit to mankind, and this drives their passion and motivation.

Coutu’s third characteristic is making do with what you have and improvising to address your problems.

A good example of this is Home Depot, which had been losing revenue and in fact under CEO Robert Nardelli had lost its market share to Lowe’s. When he left and Frank Blake took over, Blake realized that the company had lost sight of providing a great customer experience. It had expanded by purchasing Home Depot Supply, which was targeted to the commercial construction market. Home Depot Supply was increasing market share and was an important source of revenue for Home Depot (in 2006, its sales hit $12.1 billion); analysts argued that it was an important hedge against the soft housing market at that time.

But Blake decided that this business did not fit in with his plans to create a great customer experience. In fact, customer satisfaction ratings had been declining in recent years. He sold Home Depot Supply and began to improvise.

He empowered regional managers to make decisions on what merchandise to stock based on their knowledge of the local markets. He invested more in employees and stores and reconfigured the incentive program so that more employees would be eligible to participate. And he hired over 3000 skilled tradesmen (e.g., plumbers, electricians) to train store employees so they would be more knowledgeable in answering customers’ questions. Blake retired in 2014, but the company continues to do well (despite a recent data breach); in 2016, Home Depot had a 24% market share versus Lowe’s’ 17%, and it has been operating on a higher margin with significantly more stores.

Here are three take-aways from the research and from my coaching experience with executives.

First,

  • Resilient individuals share the following characteristics: a belief that they have some control over their situation.
  • Propensity to bounce back and respond positively and improvise.
  • Ability to learn from adversity and failure.

Second,

Resilience can be learned and developed.  To build individual resilience (and it is both an attitude and a skill) requires focusing on what I categorize as all three aspects of your “self”: your cognitive (your mind), behavioral (your body) and emotional (your heart) selves. The following are three practices that help to develop this skill:

  • learn to apply perspective-taking regularly (to help your understanding of what it’s like to be in the other person’s shoes);
  • Get out of your comfort zone (Eleanor Roosevelt once suggested to do one thing every day that scares you);
  • Build empathy (to learn what they are experiencing).

All these practices will help develop your capability to become more resilient.

Of course, some individuals can find it hard to recover from setbacks when they get caught up with what Seligman (1991) refers to as the three Ps: PERSONALIZATION (a belief that we are at fault), PERVASIVENESS (a belief that one event will affect all areas of your life), and PERMANENCE (a belief that the ripple effects of the event will last forever).

As Sandberg and Grant (2017) have pointed out: “Hundreds of studies have shown that children and adults recover more quickly when they realize that hardships aren’t entirely their fault, don’t affect every aspect of their lives, and won’t follow them everywhere forever.” (p. 16)

Third,

Resilience can be developed not only in individuals but also in larger entities such as communities and organizations. This is where leaders can play an important role – by encouraging resilience in others, as well as building resilience in their work groups.

To build resilience in their teams, I suggest that managers focus on these basic practices:

  • Treat employees with dignity and respect.
  • Help their team with creating some kind of shared meaning or higher purpose.
  • Encourage a learning environment and a “try-it culture.”

Bennis, W. and Thomas, R. (September, 2002). Crucibles of Leadership. Harvard Business Review.

Cacioppo, J. et al. (2011). Social Resilience: The Value of Social Fitness with an Application to the Military. American Psychologist, 66 (1): 43-52.

Coutu, (2002). How Resilience Works. Harvard Business Review.

Ehrenreich, B. (2009). Overrated Optimism: The Peril of Positive Thinking. Time Magazine, October 10.

Marson, A. and Marston, S. (2018). Type R: Transformative Resilience for Thriving in a Turbulent World. New York: Public Affairs.

Rodin, J. (2014). The Resilience Dividend: Being Strong in a World Where Things Go Wrong. New York: PublicAffairs.

Sandberg, S. and Grant, A. (2017). Option B: Facing Adversity, Building Resilience, and Finding Joy. New York: Knopf.

Seligman, M. (1991). Learned Optimism: How to Change Your Mind and Your Life. New York: Pocket Books.

Seligman, M. (2011). Building Resilience. Harvard Business Review.

Sewell, G. (2011). How Emotional Intelligence Can Make a Difference. Military Review, March-April, 79-83.

Mind the Social Distance Gap

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Johan de Nysschen (previously the successful head of Audi of America) was appointed to lead the Cadillac division of General Motors in 2014. When he joined GM, one of his first decisions was to place physical and psychological distance between Cadillac and Detroit, moving Cadillac’s headquarters from Motown to Manhattan in 2015. In New York, Mr. de Nysschen felt that Cadillac could attract top talent, follow consumer trends more closely, and gain new buyers.

Unfortunately, Cadillac, a brand that had begun to transform its outdated image, continues to struggle. Its sales plunged to 156,000 in 2017 (from 180,000 in 2013) while other competitors have become more successful. There are many reasons for his lack of success. Robert Lutz, a former Chrysler and BMW executive, has suggested that de Nysschen’s physical separation from Detroit made it harder to influence others (Ulrich, 2018). During his tenure at GM, Lutz recalled being able to march into a finance executive’s office if he had removed $200 worth of chrome that Mr. Lutz viewed as critical. “I’d say, ‘Where did the chrome go?” Mr. Lutz said. “You stare him in the eye, argue with him and get it fixed. Even in this day of electronic connectedness, distance matters.”

Based on my own experience as a global manager for many years as well as the hundreds of interviews I have conducted with global managers, social distance –the gap in the degree of emotional connection between individuals as well as among team members – is a key variable in the success of global managers and global teams. For example, quite a few expats I have met over the years have suffered from the “out of sight, out of mind” syndrome when they start to lose touch with their mentors or senior executives back in the home office.

Overcoming the disadvantages of distance in general is one of the key challenges facing global companies today. Multinationals expand overseas for compelling business reasons

  1. To seek new markets for their products and services.
  2. To take advantage of countries’ resources (what the economists call factor endowments) as well as its human capital, such as an educated workforce or particular skill sets in that country.
  3. To seek efficiencies.

At the same time, there is no doubt that distance makes it more difficult for multinationals to manage their subsidiaries and overseas locations. Youssef and Luthans (2012) have pointed out that global leaders these days experience three types of distance:

  • physical distance (due to geographical dispersion),
  • structural distance (due to organizational factors like decentralization and span of control),
  • psychological or social distance (due to status or power differentials).

Specifically, social distance reduces global managers’ ability to network, their effectiveness in building trust, and their efficiency in getting the work done. Communication gets misconstrued, and it is much harder to influence others when you cannot see your counterparts’ non-verbals. It is also harder to get feedback and to learn from the other party. To reduce the social distance gap, it is important to recognize and address what I consider to be its five major barriers.

First,

Barrier is geography or physical distance.

As Epley (2014) has pointed out, physical distance is an important aspect of our engagement with others. He cites evidence from war and battles that soldiers who are fighting are more reluctant to use their weapons when the enemy is close to them physically. MIT professor Thomas Allen created his Allen curve, which shows the relationship between frequency of interaction and physical distance:

Second,

Strive for face-to-face interactions with your team and with other stakeholders, when feasible.

“The most successful leaders make sure they establish personal connections.” As Betsy Myers (2011) has pointed out in her book, making connections is one of the qualities of effective leaders. Managing by walking around (or MBWA), popularized by Tom Peters, is still a fundamentally sound practice. When Apple was designing its new headquarters (a circular structure with 12,000 employees), its executives made it a point to make sure that the physical layout of the building maximized face-to-face contacts among employees across functions. This design was heavily influenced by the late Steve Jobs, who believed firmly in manipulating space to influence behavior. Zappos founder Tony Hsieh has talked about encouraging “collisions;” in fact, in its headquarters office, he has closed all side entrances so that all associates have to go through one main door.

Third,

Barrier is national culture.

Even though globalization and the popularity of branded products universally may seem like national cultures are becoming less important, virtually all the successful global managers I have interviewed recognize how important it is to be aware of national cultural values and norms when managing workers in different countries.

My suggestion for global managers: Develop your cultural competency by learning the cultural norms of the countries where your team members and other stakeholders are from.

Carlos Ghosn, who led a successful turnaround of Nissan in Japan, has suggested that it was important for him to like the Japanese culture and show genuine curiosity about it. 

Fourth,

Barrier is language.

Yes, English seems to be the language of business these days, with 1.75 billion people on the planet speaking English at a useful level, and for many organizations (including organizations with roots in non-English-speaking countries such as Unilever and BMW), English is commonly spoken in their offices. In fact, when bringing together stakeholders such as customers, vendors, or managers from different parts of the world, English seems to be the default language used by these corporations. Many companies in Japan require candidates for manager positions to achieve a certain level of proficiency in an English exam before they are even considered.

However, not being able to speak the local language can be a barrier to reducing social distance. There are still many parts of the world where English is not spoken in the work place, or where employees, not feeling confident in their ability to speak English, may hesitate to express their opinions. Quite a few global managers hire a local translator, or rely on their local administrative assistant, for help in translation and interpretation. But these only go so far and certainly require quite a bit of effort.

My suggestion for global managers:

  • Take language lessons, or at least learn a few words in the local language.
  • In parallel, be aware of assuming that a lack of fluency in English among your local staff means a low level of competency.
  • Not only will learning a few words in the local language help you communicate better with your local team, but will also send a signal that you are interested in their culture, and that you are going out of your way to show that you want to connect with them on more than just a business level.

Fifth,

Barrier is around structure, status and hierarchy.

Research studies have documented how upward communication is easily squelched by high-power and high-status individuals in organizations. A recent example (one among many) is the emissions scandal at Volkswagen, in which “… experts and company insiders draw a direct connection between the scandal and Volkswagen’s rigid culture, in which mid-level managers and low-level workers were reluctant to question their superiors’ decisions, including the decision to cheat on emission tests.” (This is from a story about the VW scandal by Vivienne Walt published in the August 2018 issue of Fortune magazine). Hierarchy will always be present in large global companies and as much as some organizations have tried to flatten their structures, it will never go away.

Furthermore, there are some cultures where “power distance” is valued, and where undue respect and deference is given to those in authority.

In your interactions, make sure you do more of the following:

  • Ask for input and feedback, actively listen, acknowledge your ignorance.
  • Be accessible and visible.
  • Make sure you do less of the following: punish employees for speaking up especially when it is about bad news, give orders unilaterally,
  • Refuse to admit when you have made a mistake.  

Sixth,

Barrier is identity.

Many research studies have shown that individuals categorize themselves into different group memberships (e.g., race, gender, profession, function, nationality) and once they define themselves into these memberships, two things happen: they will tend to like those who they feel are “like” them in some way; and they will start to define those who are in their “out-group” and like them less. The stronger their identification with these categories or memberships, the more intense these things happen. However, even when categories seem trivial, such as a shared birthday – what psychologists term as “mere belonging” – a sense of connectedness begins to form quickly. This is because we are hard-wired to form and maintain social bonds. Neuroscience has shown that the medial prefrontal cortex (MPFC) is a spot on each side of our brain that helps our memory and decision-making; different parts of it get activated when we are making judgments about ourselves versus others. When others are those we consider to be distant from us, those parts of our MPFC do not get activated as much, and so we don’t think of others as compassionately as we might otherwise think of those who are closer to us.

Global managers who deal with virtual teams sometimes struggle with finding a sense of identity and cohesiveness for their teams.

Establish a sense of community and shared purpose with your teams and other stakeholders by:

  • Aligning the team’s goals with the larger organizational goals,
  • Inspiring your team to have meaningful and challenging goals,
  • Finding bases for team membership that reinforce a shared sense of similarity and identity.
  • In addition, global managers should not neglect the basics of managing virtual teams effectively, for example:
  • Scheduling regular one-on-one conversations with team members, establishing regular times and routines for your meetings;
  • Regularly sending updates and communicating information and interesting pieces of news (e.g., executives who may need a bit more convincing about the value of the work that the team is doing, or even rumors on changes in the home office) so that the team feels connected.

Even though your team might be virtual, there are ways you can get members to get to know each other a little bit better and find some commonalities among them by, for example, setting up a virtual happy hour via Google Hangouts or a shared hashtag for Twitter (as suggested by PJ Camp Malik), or even build some time at the end of virtual meetings for non-work-related conversations (e.g., sports, music).

Epley, N. (2014). Mindwise: How We Understand What Others Think, Believe, Feel, and Want. New York: Knopf Books.

Myers, B. (2011). Take the Lead: Motivate, Inspire, and Bring Out the Best in Yourself and Everyone Around You. New York: Atria Books.

Ulrich, L. Cadillac Makes Great Cars. Too Bad Americans Want SUVs. New York Times, May 17, 2018.

Youseff, C. and Luthans, F. (2012). Positive Global Leadership. Journal of World Business, 47 (4): 539-547.

The Perils of Disruptive Leadership

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The headline in one of the New York Times’ sections recently read: San Francisco Lands a Disrupter. Who was the Times referring to another Silicon Valley entrepreneur, perhaps? No, this was the well-regarded conductor Esa-Pekka Salonen, who will be taking over the San Francisco Symphony and is referred to by the paper as one of classical music’s great disrupters. While the paper did not define exactly what it meant by referring to Mr. Salonen as a disrupter, there are clear hints all over the article.

For example:

“Mr. Salonen hopes to shake up the standard orchestral structure … and to …  “rethink the possibilities of what a symphonic ensemble can be.”

One of the experimental flutists who the reporter spoke to said she was attracted by “his willingness to break rules.” Salonen has worked with the Philharmonia Orchestra on virtual reality projects, immersive installations and an iPad app. The committee searching for a new conductor said it summarized the job description in terms of five bullet points:

  • musicianship
  • leadership
  • vision
  • motivation
  • evangelism

In the May-June 2019 issue of Harvard Business Review, the recruiting firm Korn Ferry has a two-page advertisement with the heading entitled, “Self Disrupt or Be Disrupted.” The advertisement explains the need for “self-disruptive” leaders in a time when disruptive forces are at work.

Now you may recall when you were in elementary school (I certainly do) and some teachers would scold those children who were being disruptive. Or in middle school, teachers would single out those kids who were a disruptive influence on others. So I had grown up believing that being disruptive was not such a good thing.

Not any more, it seems! I’ve been reading a lot about disruption lately – many positive, but also some not so positive. The driving forces behind the need for disruptive leadership seem to be the following,

  1. The environment has become so dynamic and unpredictable and will become even more so, especially with the advances in AI and digitization, that leaders are needed who can anticipate this disruption.
  2. In many organizations, the status quo is so entrenched and so intractable that the current state of affairs requires disruptive leadership to unmoor it.
  3. Businesses are counting on innovation more than ever to grow, and the perception is that disruptive leaders are those in the best position to lead such innovation.

In addition, we have seen executives from the outside who have been hired to “shake things up.” Some, such as Alan Mulally, former CEO of Ford Motor Company and Lou Gerstner, former CEO of IBM, succeeded; while others, such as Bob Nardelli (former CEO of Home Depot) and Ron Johnson (former CEO of J. C. Penney) did not.

Recently, several executives I have spoken to have also mentioned the need for more “disruptive” leaders in their organizations. From my small sample, these are the four characteristics that the executives I spoke with said that they see in disruptive leaders:

  • Bold.
  • Willing to challenge.
  • Question the status quo and break the rules.
  • An ability to think “outside of the box” and remaining doggedly persistent.

I asked, why are they looking for these disruptive leaders? What do they hope to accomplish by having such leaders? Almost unanimously, the responses were: 

“To spur greater innovation and breakthrough thinking, and to transform the culture into one that is more agile, nimble and resilient.”

These two objectives of producing greater innovation and a nimbler culture – are ones that many organizations are pursuing these days, whether they are budding start-ups or more established firms like Unilever and General Motors. Many believe that one way to get there is by having more disruptive leaders who can be “game changers” in their organizations. However, the research shows that individuals who have some of the characteristics of disruptive leaders also tend to have other less desirable characteristics. Let’s take a look at the Hogan Development Survey, a well-known assessment instrument for measuring a leader’s derailing characteristics. According to Hogan (2007), most people will display certain counterproductive tendencies when under pressure.

In fact, “under normal conditions these characteristics may actually be strengths. However, when you are tired, pressured, bored, or otherwise distracted, these risk factors may impede your effectiveness and erode the quality of your relationships with customers, colleagues, and direct reports.”

In Hogan’s research, there are eleven such risk factors or derailers. The four characteristics of disruptive leaders I described earlier belong to a subset of these derailers; specifically:

  • Being bold can lead to a leader’s unwarranted self-confidence and an unwillingness to listen to feedback.
  • A willingness to question, challenge the status quo, and break the rules can lead to taking risks while ignoring the consequences and acting impulsively.
  • Consistently thinking outside the box  can lead to losing focus on the core aspects of the business and having so many ideas that execution gets sidetracked.
  • Being doggedly persistent can lead to stubbornness and not letting go of pet projects and ideas that may not be realistically executed.

So if you want to be a disruptive leader, or you already have some of the characteristics of a disruptive leader, what can you do to counterbalance these derailing tendencies, especially when you are under pressure? In addition to increasing your self-awareness and getting feedback from others, here are four quick suggestions for you to consider (actually, these can apply to any leader who wishes to successfully transform his or her group, team, or organization).

First,

  • Deeply understand the context or organizational situation in which you find yourself. Find out what has worked in the past, and what hasn’t worked. Understand the barriers to change, and the cultural heritage of the company. Internally, seek out those who have been with the company for a while, who are credible, and who know the skeletons in the closet. At the same time, talk to individuals who have joined the company in the past six months to learn what frustrations they might have. Externally, reach out to those working in the same industry as well as in other industries to get lessons learned about how these companies were able to shake up established markets to disrupt and succeed.

Second,

  • Complement your disruptive mind-set by building on specific skills. Here, I’d like to turn to the recent work by Dyer et al. (2011), in which they researched the 25 most innovative companies in the U.S. and came up with what they describe as the five “discovery” skills of disruptive innovators:


Associating (the ability to make surprising connections across different areas of knowledge, industries and geographies), Questioning (asking a lot of questions, e.g., what, why; and a lot of provocative questions, e.g., why-not, what-if), Observing (e.g., watching customers, learning to look for surprises or anomalies, finding opportunities to observe in a new environment), Networking (not for career progression but to actively tap into new ideas and insights by talking with people who have diverse ideas and perspectives), and Experimenting (trying out new ideas through exploration, taking things apart, testing ideas through pilots and prototypes). These are skills that you can build through practice, especially with the help of a coach.

Third,

  • Frame your ideas in a broader context; don’t just sow chaos without having people understand the big picture and especially what the impact of the disruption will mean – for the company’s future, its reputation and impact on society, and how employees will benefit. It is especially important to communicate what will not change. You want to create some sense of stability and not have people feel that you are throwing everything up against the wall and seeing what sticks. Beware of creating change just for the sake of change, and make sure that changes can ultimately be integrated into the fabric of the company. At the same time, you never want to allow the organization to slip back into a state of complacency; employees need to believe that they have to get out of their comfort zone.

Fourth,

  • Create a climate of “psychological safety” so your team will feel free to speak up, to be candid, and to push back if needed. Amy Edmondson (2019) has written persuasively about the benefits of psychological safety, and what can happen when this is absent. In its own research, Google has found psychological safety to be one of the most important leadership practices for creating effective teams (Garvin, 2013).

With all this, what’s most important, in my opinion, is that you as a leader need to have the inner courage and determination to do what you (and those in your team you respect) believe has to be done for the good of the organization. It is what Andy Grove did when he made the decision to move away from the memory chip business to microprocessors, despite the success Intel was having at that time with the chip business. It is what Satya Nadella did when he made the decision to shift Microsoft’s business to cloud computing. It is what Hamdi Ulukaya of Chobani did when he acquired an old factory in upstate New York to start his dream of a yogurt business. It is what Yves Chouinard of Patagonia, is doing with his company’s environmental practices (e.g., introducing patented chocks to eliminate the harm to rocks from climbing products, encouraging consumers to actually buy less).

Dyer, J. et al. (2011). The Innovator’s DNA: Mastering the Five Skills of Disruptive Innovators.

Edmondson, A. (2019). Creating Psychological Safety in the Workplace. Harvard Business Review.

Garvin, D. (2013). How Google Sold Its Engineers on Management. Harvard Business Review.

Hogan, R. et al. (2007). The Hogan Guide: Interpretation and Use of Hogan Inventories.

Being Civil in an Increasingly Uncivil World

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In one of my recent conversations with my twenty-something daughter, she asked me, as a management professor and consultant, why I thought so many CEOs were jerks. (Note that although my daughter is well-informed, she does not work in the corporate world and certainly does not know any CEOs personally.) I proceeded to explain to her that this was not necessarily the case, that there were far more CEOs who were nice and civil and who were nonetheless successful. And not all jerk CEOs are successful. For example, Uber’s founder Travis Kalanick resigned recently due to the toxic culture that he had created in the company. She was not convinced, perhaps because of “availability bias,” where news and events that are memorable or have been in the headlines tend to be remembered more vividly. 

Take for example Elon Musk, another larger-than-life CEO who can be characterized as someone less than civil in his behavior. In a recent article about him entitled Musk vs. Musk in the Wall Street Journal, the authors described an incident at Tesla’s factory in Fremont, California, where the assembly line stopped because safety sensors detected that people were in the way. Well, Musk got furious and started head-butting the front end of a car on the assembly line. He just wanted the cars to keep moving. And when a senior manager explained that this was a safety measure, Musk told him to get out and fired him on the spot. According to the article, more than 50 vice presidents or higher have left Tesla in the past two years. Despite this, Musk (like Jobs a decade ago) is fawned over and admired by many – who then conclude that being a jerk is perhaps a prerequisite to being a successful leader.

In this highly polarized political world, civility might seem outdated or old-fashioned, but it has a long history. George Washington even wrote a book about it. Skim George Washington’s Rules of Civility and Decent Behavior, which he wrote when he was fourteen, and there is a refreshing timeless feel to it. For example:

  • Every action done in company ought to be with some sign of respect to those that are present.
  • The gestures of the body must be suited to the discussion you are upon.
  • Speak not evil of the absent, for it is unjust.
  • Don’t ruin a good apology with a bad excuse.
  • Wherein you reprove another be unblameable yourself, for example is more prevalent than precepts.

And over the years the Cub and Boy Scouts of America have kept certain rules of civility and taught millions of boys the importance of respect and civility. However, as documented by the Civility in America report, 69% of Americans in 2018 reported that there is a problem with civility in America today, up from 65% in 2010. Furthermore, 84% have at one time or another experienced incivility; in 2018, Americans reported an average of 10.6 incivility encounters per week.

What about in the workplace?

Professor Christine Porath has estimated that 98% of workers have experienced incivility, with 50% experiencing incivility weekly. The interviews and discussions I have had with managers seem to confirm this. Why? According to Porath’s research (Porath, 2016), over 60% claim they are “overloaded” and just have no time to be nice. Based on my own experience in coaching managers, I agree; the stress and pressures on managers to deliver results quickly, and with fewer resources, will continue unabated. There will be some managers (as many as fifty percent, according to research by Hogan) who will show their “dark side” under such circumstances. Professor Sutton has called such managers “bossholes” (Sutton, 2010), and documents some of the effects these managers have on their workers, e.g., declines in physical and mental health, higher anxiety levels, loss of motivation and job satisfaction.

There are at least three other reasons for the prevalence of incivility,

  1. Some leaders mistake civility with being “too nice,” and fear that people will take advantage of them, and that they will not be seen as authoritative leaders if they are too nice. And some organizational cultures reinforce this. Many years ago, when I started to work for a major multinational firm based in New York, I quickly learned that to be seen as a leader, I had to be somewhat rude and aggressively interrupt others at meetings to make my point.
  2.  Research has shown that having more power and higher status can make some managers overly self-confident, arrogant, less likely to listen to others, and more condescending – the beginnings of incivility! And the higher up they are, the more pervasive this becomes. It becomes a vicious cycle; high-status and high-power leaders tend not to listen and dismiss negative feedback, while those lower in the organization learn not to give them any negative feedback, and to simply tell them how great they are.
  3. Studies show that individuals who show a lot of self-confidence, aggressiveness, and dominance tend to be seen as “leader-like” and therefore tend to be selected and promoted more often than those who don’t show these qualities. This is in spite of the evidence that those individuals who show humility, empathy, kindness and build trust tend to be more effective leaders.

Unfortunately, incivility has many negative consequences. One recent study found that, 78% of people who experience uncivil behavior from their colleagues become less committed to the organization; 66% suffer decline in overall performance; 47% deliberately spend less time at work; and 25% take their frustrations out on customers.

Let’s define what we mean by workplace incivility; I’ll use the definition offered by Schilpzand et al. (2016): “low-intensity deviant workplace behavior with an ambiguous intent to harm” such as “talking down to others, making demeaning remarks, and not listening to somebody.” In other words, incivility is less intense than aggression, violence, or bullying and is not overtly seen as harmful; it can come not only from managers but also from coworkers or customers.

Here are other examples of incivility:

  • Devaluing and discouraging.
  • Condescending language or voice intonation.
  • Impatience with questions or phone calls.
  • Being reprimanded in front of others.
  • Insulting the intelligence of a co-worker.
  • Argumentative behavior.
  • Sending nasty or sarcastic e-mails, and making unreasonable requests.

Incivility is different from being demanding, or the occasional outburst by a manager who gets upset by, say, a worker under performing or for not letting him or her know about a mistake she made that might cost the company. I am not advocating that managers treat employees with kid gloves, become being overly nice and avoid any criticism for fear of hurting their feelings. In fact, managers who set high standards and have high expectations for their team, who are raising the bar regularly to get better results, but who do it in ways that respect their subordinates and where a relationship of trust has been established – these managers get great results and build a team of engaged and motivated workers. Being uncivil – and worse, being abusive – is never acceptable. When there is a climate of incivility in a work group or team, you will know it. While this is often triggered by the manager, it can also be perpetuated by co-workers. However, it is the manager’s primary responsibility to call attention to it and to make it clear that such behaviors will not be tolerated.

However, I believe that civility may be making a comeback for the following reasons. First, a desire by workers to be treated with dignity and respect, especially when the wage gaps between senior management and lower-level employees have widened and where employees see that the economic system has not been fair to many of them.

In a study of nearly 20,000 employees around the world (conducted with Harvard Business Review), Porath (2016) found that the most important thing that employees want from their leader is respect.

“No other leadership behavior had a bigger effect on employees across the outcomes we measured. Being treated with respect was more important to employees than recognition and appreciation, communicating an inspiring vision, providing useful feedback — or even opportunities for learning, growth, and development. However, even when leaders know that showing respect is critical, many struggle to demonstrate it.”

  • An increase in the percentage of millennial’s (roughly between the ages of 22-37 in 2018) in the workplace and their desire for greater transparency and candor. It has been projected that by 2019, millennial’s will be the largest living adult population in the U.S., and by 2020, nearly half the working population will be comprised of millennial’s. Millennial’s have grown up with technology, and in general are more socially conscious, and they expect their employers to act in socially conscious ways. They are perhaps less tolerant of rude, uncivilized behavior than other generations. They were raised by parents who were more respectful of them and their views than perhaps their parents’ parents were (“Just shut up and do as you are told.”
  • A greater emphasis by organizations on values and behaviors in addition to results. Since Jack Welch introduced his famous 2 X 2 matrix of behaviors (on one dimension) and results (on the other dimension), many organizations have introduced values, competencies and behaviors as part of what they believe employees should be evaluated on. While many organizations pay lip service to this, there are a growing number that actually take this seriously and base promotion decisions not only on results but also whether employees exhibit the right behaviors.
  • The pursuit of attracting and retaining the best talent by many organizations. Google and other firms may offer free food and many perks, but more important for many talented individuals today is joining a firm with a positive culture. For millennial’s in particular, this means an environment where they have meaningful work, are given opportunities to develop, and whether they feel that the organization not only values but practices meritocracy.

I don’t pretend to imagine for a moment that incivility, and its extreme, abusive behavior by bosses, will disappear overnight. Here are three quick pieces of advice for individuals. First, take Porath’s civility test (http://www.christineporath.com/take-the-assessment/), preferably along with a trusted colleague, and discuss your results. What does civility mean to you, and do you value it? Does it help define who you are and who you want to be? If so, what is getting in the way?  Second, hold back and think before you speak, act, or tweet. Be careful about acting on your first impulses. We often say things in the heat of the moment that we regret afterwards, and exercising self-restraint is more often than not a good thing. Third, be courageous in pointing out uncivil behavior in others; at the same time, own your mistakes. The latter is advice from two former social secretaries and special assistants to U.S. presidents (Berman and Bernard, 2018). If you are wrong, apologize and say so; be clear and do not blame others or circumstances.

Berman, L. and Bernard, J. (2018). Treating People Well: The Extraordinary Power of Civility at Work and in Life. New York: Scribner.

Carroll, S. (2016). The Serengeti Rules: The Quest to Conquer How Life Works and Why It Matters. Princeton, NJ: Princeton University Press.

Porath, C. (2016). Mastering Civility: A Manifesto for the Workplace. New York: Grand Central Publishing.

Schilpzand, P. et al. (2016). Workplace Incivility: A Review of the Literature and Agenda for Future Research. Journal of Organizational Behavior, 37: 57-88.

A Checklist for Global Managers

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In his book, The Checklist Manifesto, Dr. Atul Gawande writes about what Wal-Mart did in the wake of Hurricane Katrina.  As you may recall, this was a major disaster in New Orleans, where 80 percent of the city was flooded and 20,000 refugees were stranded at the New Orleans Superdome.  Another 20,000 were at the Convention Center. There was no power in the city hospitals. Wal-Mart closed its 126 stores, but within 48 hours, more than half of them were up and running again.  Wal-Mart employees and managers somehow mobilized, with the use of simple checklists:

“They set up temporary mobile pharmacies in the city and adopted a plan to provide medications for free at all of their stores … They set up free check cashing for payroll and other checks in disaster-area stores.  They opened temporary clinics to provide emergency personnel with inoculations … within two days of Katrina’s landfall, the company’s logistics teams managed to contrive ways to get tractor trailers with food, water, and emergency equipment past roadblocks and into the dying city.  They were able to supply water and food to refugees and even to the National Guard a day before the government appeared on the scene.” (pp. 77-78)

Gawande’s point is not to praise Wal-Mart, nor to point to the superiority of the private sector over the public sector (i.e., FEMA).  This situation is where he started to understand the power of having a checklist.

As another example, Gawande writes about the Chairman of Surgery at the University of Toronto, who has been using a 21-item surgery checklist to catch potential errors in surgical care.  What is interesting is that the checklist also includes a team briefing. “The team members were supposed to stop and take a moment simply to talk with one another before proceeding – about how long the surgeon expected the operation to take, how much blood loss everyone should be prepared for, whether the patient had any risks or concerns the team should know about.”  (pp. 100-101)

In surgery, according to Gawande, you can have checklists for three of the four big killers:  infection, bleeding, and unsafe anesthesia. The fourth killer in surgery is the unexpected. So how do you prevent this?  The value of having a checklist is that it facilitates a dialogue, and people have to stop and talk through the case together before surgery. Unfortunately, according to Gawande, this kind of teamwork is not common in surgical teams.  Some research that he cites shows that team members that regularly used checklists showed great improvements in their ratings of their own teamwork.

According to Gawande, “ … under conditions of complexity, not only are checklists a help, they are required for success.  There must always be room for judgment, but judgment aided – and even enhanced – by procedure.” (p. 79)

What kinds of management situations might a checklist be used for?  Actually, Professor Michael Useem has come up with his own checklist for leaders, consisting of 15 principles.  Like Gawande, he argues that “ … when uncertainty becomes the norm and turbulence more commonplace … a Leader’s Checklist becomes more consequential.”  (p. 41)

Many of the items in Useem’s leader checklist can apply to managers leading globally.  They include articulating a vision, communicating persuasively, and building leadership in others.  However, as many of you know, global leaders face different circumstances and need to take into consideration other cultural variables.  

So I have come up a checklist for global managers.  The “targets” referred to in this checklist are those individuals, groups, or organizations from another culture that you will be interacting with.

  1. Understand your cultural assumptions.  
    • Are you aware which of your management style preferences and behaviors are influenced by your culture?
    • Are there aspects of your management style or behavior that works in your culture that might not work in other cultures?
  2. Map your targets’ cultural values.
    • What are the most important cultural values of the people or group you will be dealing with?
    • How do these values show up in how they do business with others?
  3. Establish cultural baseline behaviors with your targets.
    • Are there specific behaviors that you should be avoiding when dealing with them?
    • Are there specific behaviors that you should be sure to demonstrate when dealing with them?
  4. Clarify your managerial goals and your core values.
    • What do you hope to accomplish – not so much in terms of the task or work, but in terms of your management of your targets?
    • What are the most important values you hold, especially around management?
  5. Identify culturally appropriate options to achieving these goals.
    • Are there alternative ways to achieve your goals that might be more culturally appropriate?
    • Which of these may require your getting out of your comfort zone?
  6. Seek feedback and mentoring from others.
    • Are there people from the cultures you are dealing with, that you can approach to ask questions and get feedback?
    • Do you have a plan on building relationships with these individuals so you can gain their trust?
  7. Adjust, experiment and continuously improve.
    • Are you reflecting on what you are learning about others’ reactions to you and the feedback you are getting?
    • How are you applying what you have learned to improve yourself in your cultural interactions?
  8. Preserve your character and integrity.
    • Are people clear – not so much by your words but by your actions – on what you stand for?
    • Are you clear on what you stand for?

 

Gawande, A.  (2011). The Checklist Manifesto.  New York:  Picador.
Useem, M.  (2011). The Leader’s Checklist.  Philadelphia:  Wharton Digital Press.

Fostering a Global Mindset Culture in Your Organization

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A recent “Idea Watch” article in Harvard Business Review reported on some new research that Carol Dweck and her colleagues are conducting.  As some of you are aware, Dweck popularized the concept of “growth mindset” (versus a fixed mindset). People with a growth mindset, according to her early research, enjoy challenges, strive to learn and consistently, and see potential to develop new skills.  

Now she has been exploring the idea whether organizations can have growth or fixed mindsets. So far, her research seems promising.  She and her team have developed a survey that has been implemented among employees at seven Fortune 1000 companies. Employees rate the extent to which they agree with a series of statements, such as “When it comes to being successful, this company seems to believe that people have a certain amount of talent, and they really can’t do much to change it.”

Dweck concludes that there is a great deal of consensus about what the prevailing mindset is in these employees’ organizations with regard to growth.  Her research shows that employees in growth mindset companies are:

  • 47% likelier to say that their colleagues are trustworthy
  • 34% likelier to feel a strong sense of ownership and commitment to the company
  • 65% likelier to say that the company supports risk taking
  • 49% likelier to say that the company fosters innovation.

Similarly, I believe that organizations can be assessed on whether it has a global mindset culture, above and beyond the presence of employees who have the traits or qualities of an individual global mindset.  Of course, hiring and developing such individuals in your company is helpful, but can be inefficient since it may take companies a long time to reach the critical mass needed. Another approach therefore is to develop an overall strategy to build or improve the organization’s global mindset culture.  The first step in developing this strategy is to diagnose your company’s current state with regard to its global mindset culture. So here are eleven key indicators that will help you assess your company’s current global mindset culture.

  1. Top management commitment to building a global mindset culture.  How regularly do the senior executives in your company reinforce the importance of thinking globally and recognizing the importance of markets other than the home market?  How often do executives travel overseas to learn about the importance of these markets – especially from their overseas subsidiaries? How frequently do managers and executives from overseas subsidiaries come to headquarters to participate in meetings?  Are key executives from overseas represented in important task forces and corporate initiatives?
  2. Structures and processes for global alignment and coordination.  What formal and informal mechanisms has your company put in place to facilitate efficient and effective coordination across countries where your company does business?  How well defined are your company’s formal structures, such as matrix relationships, global and regional roles, and roles and responsibilities of headquarters and subsidiaries?  When global teams are created, how well represented are subsidiaries from relevant countries?
  3. Infrastructures for global communication.  Has your company invested in the necessary technologies to enable efficient communication across countries?  And how much training and support is being provided so employees can take advantage of these new tools?
  4. Assessment of global mindset potential.  How important does your company consider global mindset in selecting internal or external candidates for positions that will require cross-cultural interactions?  Is cultural fit one of the criteria used before assigning individuals to global roles?
  5. Use of development assignments to build global mindset.  When setting development plans for individuals who may have high potential, what opportunities are provided for them to learn and acquire experiences in working across different markets and cultures?
  6. Reducing the headquarters ‘center of gravity.’  Has your company considered relocating some key functions out of headquarters into one of its key markets overseas?  Are at least some of your company’s centers of excellence or expertise located overseas? Are regional heads and their staffs still based in headquarters or have they moved out to the regions?
  7. Cross-cultural awareness and sensitivity as a key element in the company’s learning strategy.  How available and accessible are resources for employees to improve their cross-cultural awareness (e.g., on-line courses on doing business in different cultures, reimbursement for language training, etc.)?
  8. A global talent pool.  How inclusive is your company’s global talent management process?  For example, when considering internal candidates for key positions, does the slate of candidates include highly qualified employees from different locations?
  9. Recognition and rewards for those with global mindsets.  How valued are those individuals who have proven themselves in overseas assignments, not just in improving business results but also in being recognized as someone who has worked effectively with different cultures?  When these individuals complete their assignments, to what extent does your company leverage their experience? Does your company’s competency model and performance evaluation system include global mindset behaviors as a key element?

In a recent study by Price Waterhouse Coopers (Wang, 2014). 4,108 return migrants from 81 countries of origin who had spent between three months and two years in the U.S. at some point during the years between 1997 and 2011 under a category of the J-1 visa designated for professional training completed a survey.   These respondents all had bachelor’s or master’s degrees, and had work experience in many industries with companies such as Google and JPMorgan Chase, as well as thousands of small startups and midsized companies.

What did they find?  While almost all of the respondents reported having learned about practices overseas that they could implement in their home countries, only 67 percent reported having shared any of this knowledge upon their return. And only 48 percent reported having shared knowledge and then having seen this knowledge implemented.   The study concludes: This means that on average, for every two workers with international experience hired by a given firm, only one will successfully share knowledge from overseas at some point during his or her tenure.

Interestingly, countries like China, India and Brazil are creating incentives to entice their foreign-trained nationals to return.  A recent Wall Street Journal article described the emergence of these “sea turtles,” the term used for a Chinese native who is returning home after several assignments in the West.  The article mentions several such Chinese businessmen who, after working for multinationals like Coca-Cola and Nike in the U.S., have decided to return to China, often in much larger roles and with much greater compensation than they had in their former companies’ headquarters.  Aside from these considerations, there is the perception that the opportunities with a Chinese company are greater, as are the psychic benefits. For example, Guo Xin, a sea turtle who joined a Chinese recruiting firm, said, “You’re making global decisions rather than having these decisions made for you” by Western headquarters.  

  1. Support for individuals on overseas assignments.  Does your company provide ongoing support for individuals on overseas assignments – before, during and after the assignment is over?  In Ernst & Young’s Global Mobility Effectiveness Survey (2013), they found that on average, 16% of assignees left the company within the first two years after repatriation, and a further 41% returned to their pre-assignment position.  Does your company require some form of cultural training for the individuals and their families prior to an overseas assignment. For example, BASF works with an outside vendor that helps international assignees adjust to their new surroundings.  The vendor also provides “cultural attaches” who will help BASF employees with the day-to-day logistics of settling in a new country, e.g., finding apartments, completing mandatory state registrations, setting up bank accounts, etc.

In another company, I helped develop an expatriate mentorship program whereby international assignees were assigned to senior executives as mentors, with the condition that these senior executives had to be outside these individuals’ functions.  For example, the CIO volunteered to mentor two individuals in Marketing and two managers in Finance who were all in overseas locations. He kept in contact with them throughout their assignments, and helped facilitate their transition back to their next assignments.

  1. Formal and informal processes for sharing best practices globally.  When he was CEO of GE, Jack Welch was relentless in promoting knowledge management, and he held people accountable to make sure that they were proactive in communicating and sharing best practices.  How much sharing of information and best practices goes on internally in your company, and are there formal and informal mechanisms for facilitating the dissemination of these best practices? Somewhat belatedly, for example, GM has just begun to implement this.  In an interview with the Wall Street Journal (November 2, 2014), President Dan Ammann described what the company has started to do:

“A couple months ago we brought about 25 of the top sales leaders from around the world together in Charlotte, N.C.  We conducted workshops where each discussed the tactics they are using in their home markets to drive sales, work with dealers and interact with customers.  This is the first time anyone can remember that happening.”

Perhaps next time they should meet in Beijing, Sao Paolo, or Mexico City.

Once you’ve done your assessment, then you’ll have a better understanding of where the gaps are, and your organization can begin to prioritize actions to narrow these gaps, taking into account the organization’s overall strategic goals and where the best payoffs are.  For example, if the organization is planning a major expansion into China over the next three to five years, then assessing cultural fit among high potential employees (#5) and establishing an office in one of its cities (#6) should be high on the list of actions.

 

Bennett, J.  (2014). GM’s Ammann Drives for Change.  Wall Street Journal, November 12.

Chu, K. and Lublin, J.  (2014). Chinese firms bring more natives home.  Wall Street Journal, September 3.

Gupta, A. and Govindarajan, V.  (2002). Cultivating a Global Mindset.  Academy of Management Executive, 16(1), pp. 116-126.

Idea Watch.  (2014). How Companies Can Profit from a Growth Mindset.  Harvard Business Review, November, pp. 28-29.  

Wang, D. (2014).   The Untapped Value of Overseas Experience.  Strategy + Business: http://www.strategy-business.com/article/00283?pg=all.

Global Leaders’ Moments of Truth

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Many years ago, while consulting with the Customer Service unit of a consumer products company, I came across a book by Jan Carlzon, then president of Scandinavian Airlines System (SAS), called “Moments of Truth.”  This phrase, which has now entered the business vocabulary, described the contact between a customer and a company representative that can profoundly impact the customer’s impression of the product and/or the company.  In the book, this is how Carlzon described it:

“Last year, each of our 10 million customers came in contact with approximately five SAS employees, and this contact lasted an average of 15 seconds at a time.  Thus, SAS is ‘created’ 50 million times a year, 15 seconds at a time. These 15 million ‘moments of truth’ are the moments that ultimately determine whether SAS will succeed or fail as a company.  They are the moments when we must prove to our customers that SAS is their best alternative.”

Those of us working globally have many interactions with different stakeholders coming from different cultures.  They include customers, vendors, subordinates, bosses, and colleagues in the various places where we do business.  Some of these interactions could certainly be described as “moments of truth,” when the outcomes of these interactions can lead to a more positive path and ultimately a productive and effective relationship – or its opposite.

I’ve identified nine such sets of interactions or “hot spots” where your cultural intelligence will be put to the test. Your ability to handle these interactions effectively will help you to survive and thrive as a global leader.

Here’s the list.  These are not sequential, although clearly the first two can make or break a potential relationship you are trying to establish.  Some of these interactions are one-on-one, others are with a group. The specific tactics you use will also depend on the characteristics of the person or group you are interacting with; for example, greeting a male senior executive in Japan will be different than greeting a young female professional.

  1. Greeting someone
  2. Establishing rapport
  3. Leading a team
  4. Conducting a meeting/participating in a meeting
  5. Providing instructions or guidance; coaching and teaching
  6. Resolving disagreements and conflicts
  7. Negotiating
  8. Motivating others
  9. Giving and receiving feedback

For example, Lucy Kellaway, the acerbic columnist of the Financial Times, wrote a column recently about the challenges of greeting people from different cultures.  She was giving a talk primarily to Asian women at a conference in Singapore and she was at a loss as to how to greet the various attendees at the conference:

“In the old days, the principle was when-in-Rome. So when actually in Rome you kissed on both cheeks anyone you knew reasonably well. In Holland, it was three cheeks. In Russia you might expect a crushing bear hug, in Japan a nod and in India hands clasped and a namaste. In the US and Germany you could look forward to a bonecrusher of a handshake, in the Middle East something more like a limp fish.”

“Global business has made matters more complicated. We no longer know whose culture trumps whose. Is it the host country’s? Is it the majority in the room? As no one seems to know, what tends to happen is a general confusing, embarrassing free-for-all. We live in a permanent state of hello hell.”

She then adds:

“Now an even more unwelcome form of greeting has arrived: the hug. This is how young Anglo-Saxons routinely greet each other outside work, but now they have started doing it in the office too. The hug represents far too much touching for my liking, but is also devilishly hard to get right: there is the full hug, the side hug, and the hug accompanied by a slap on the back.”

“In my other job as a non-executive director, hello hell has got so bad that I find myself dreading the start of every meeting. Diversity might be a good thing on a board, but diversity of greeting is deplorable. My European colleagues are confident and enthusiastic kissers, as is one of the British women non-execs, while various of my male colleagues seem to dislike it as much as I do. Which means I often end up kissing some of the directors but not others – which seems very wrong indeed.”

Rather tongue-in-cheek (I think), she proposes a Global Greetings Protocol, where the only permissible greeting in a business setting would be a handshake.  If it were only that simple.

Given the research on our subconscious biases and first impressions, thinking through your approach to greeting people from other cultures is, I believe, enormously important, and deserves a great deal of thought on your part on how to approach and greet someone from another culture.

Greeting someone, of course, is just one of the key interaction hot spots (see above) that can make or break your effectiveness as a global leader.  I have three pieces of advice on how you can benefit from these interactions. First, understand what your “default mode” is in each of these situations.  Most of us have a preferred way of approaching certain interpersonal situations based on our experiences and our own natural inclinations. Keep in mind that your preferred way may also be influenced by cultural assumptions and norms.  For example, Americans and Germans like to resolve conflicts by being very direct and raising issues in a straightforward way – to “cut to the chase,” as the expression goes. So what’s your typical modus operandi when you’re trying to resolve a conflict or disagreement? You might be thinking, it depends on who the person is.  Yes, of course, and that is a reasonable response; nonetheless, you are likely to have a preferred approach, one that you use other things being equal.

Second, consider the cultural background of the person or group you will interact with.  As mentioned above, most of us will recognize that we will need to adjust our approach depending on the specific characteristics of the person or group we are interacting with (e.g., their age, gender, position in the organization, educational level).  What I am suggesting is that you include culture as another dimension to consider. For example, Hannah is a manager of a global IT consulting company who was recently appointed to lead a team of Indian consultants in Bangalore. Hannah has a reputation as a good leader who likes to empower and delegate.  But aware of the cultural expectations of her Indian staff, Hannah has had to adjust her style to make sure that she is more directive and explicit about her communication, at least initially.

Third, adjust your approach so that it is culturally appropriate for that person or group.  What this means is that you will have to develop a repertoire of approaches, and not always rely on your default mode, difficult as that may be at times.  We naturally gravitate to behaviors that either come naturally to us or that we have been used to because we have been doing it for a long time. The challenge for many global leaders is not only to stop and think about other cultures, but also to go into manual mode and use those behaviors that are most appropriate for that culture.  For example, this may mean that you don’t always look a person directly in the eye in a culture where doing this with very senior executives may not be considered appropriate.

This also means that you may have to practice some new behaviors and, as Molinsky so eloquently describes in his book Global Dexterity, expand your personal comfort zone.  It’s not always easy to do this, but you can make a conscious effort by practicing some new behaviors incrementally.

For example, Feng was a Chinese student in my class who was not used to speaking up in the classroom.  In China, students are not expected to raise hands, nor are class discussions encouraged. As a result, when she signed up for her MBA classes, she felt overwhelmed and intimidated.  In advising her, we worked out a goal of being a more active participant in the class. She started out by writing down a question beforehand that she would ask the professor. So when, towards the end of a lecture, the professor would ask if there were any questions, she would raise her hand and ask a question.  Eventually, as she became more comfortable in asking questions, she then wrote down a couple of points she wanted to make about whatever was being discussed that day, and raised her hand to offer her opinion when her professor asked for comments. By the end of the semester, she was a more active participant although she still cannot just “jump in” to a discussion – at least not yet.

 

Carlzon, J.  (1989). Moments of Truth.  New York:  HarperBusiness.

Kellaway, L.  Do we hug?  Kiss? Shake hands?  Bow?  Financial Times, September 22, 2013.

Molinsky, A.  (2013). Global Dexterity.  Boston:  Harvard Business Review Press.

Coming to Grips with Corporate Culture

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“Culture” has been in the business news again lately, from General Motors’ failure to recall its faulty ignition switches to the replacement of an outsider for Target’s new CEO.  Those of us who have worked for more than one company, and/or have friends and acquaintances who work for different companies, know how powerful corporate culture can be. 

We all know that companies, like all social groupings, tend to form cultures that influence the way its employees think, feel and perceive what is going on.  When I worked for Citibank many years ago, I would compare notes with a colleague who worked for what was then called the Chase Manhattan Bank on how different our respective company cultures were.  Citibank was then brash, and its employees were expected to be aggressive, and even rude.  Chase Manhattan was more polite, and employees were expected to behave more gently.  As we know, cultural fit is important to corporate survival.  Many companies assess cultural fit before hiring managers, and many executives de-rail not because they lack technical expertise but because they lack this cultural fit.

Executives in successful companies, recognizing the importance of culture, try to shape their company’s culture to be aligned with the company’s strategy.  For example, Wal-Mart instills an almost obsessive regard for expense management that is in keeping with its strategy to be the low-cost provider and remain profitable through its “everyday low pricing” business model. 

As Lane et al. point out, culture is important because it serves two functions.  One, it helps efficiency.  Everyone in the company is expected to know that there is a way of doing things (companies even label these, such as “The Wal-Mart Way” and “The Toyota Way”) and once employees learn this, the company can operate more efficiently.  What is interesting is that many of these so-called norms are not necessarily written down or documented.  But once we learn the cultural code, many things don’t have to be spelled out.  We know that is the way things are done and violating this cultural code can have consequences.  I remember a company I was involved with where decisions had to be made by consensus.  An executive hired from the outside felt that this was not good for a company that was trying to be more agile and so he started to make decisions without going through the usual channels.  There was so much resistance to his attempts that he only lasted a year with the company.

The second function of culture, according to Lane et al., is that is provides an important source of social identity for its members.  Culture serves as a kind of psychological “glue”; the stronger the culture, the stickier the glue.  Belonging to a group not only provides some security; it also increases our identification and commitment with the group (or company).  Creating a strong culture is especially important for global organizations with subsidiaries in dozens of different countries.  Expatriates from these organizations who go overseas not only provide technical expertise but also serve as cultural ambassadors.  I have seldom seen expatriates being sent overseas who have either just joined their company or are not able to “represent” the company in a positive way.  Strong identification with the company also reduces turnover, and enhances the feeling of pride an employee has in working for the company.

Changing a culture as powerful as GM’s will be an uphill battle but it can be done.  There have been successful attempts at cultural change in companies like GE, Ford, IBM, Nissan and many other companies.  I have been involved with a few companies where the culture changed successfully although in all cases, it took time – as much as five years. 

In brief, what does it take?  Corporate culture, in my opinion, is shaped by three sets of forces, and so understanding these forces and using them to help drive change is a good first step.  In my opinion, these three forces are self-reinforcing and interdependent; implementing changes in one without taking into account the others will not work.  The first force is leader behavior.  Nothing speaks louder to employees than how leaders behave (not what they say should be done).  When Carlos Ghosn of Renault went to Japan to head Nissan, he made it a point to walk around the plant floors and introduced himself to shocked groups of employees.  When CEO John Reed championed Six Sigma at Citibank, he himself went through the training and taught some of the training workshops to employees.

The second set of forces involves the company’s processes and systems.  This is where the rubber hits the road, in the day-to-day activities that shape employees’ behaviors.  In my experience, the most important of these include decision-making processes, how conflicts are resolved, and how employees are recognized and rewarded.  Changing these processes and systems will begin to create changes in the culture. 

The third involves the company’s structure.  Microsoft recently restructured its organization to break down silos.  Many companies such as Cisco, P&G and IBM have moved to a more matrix-type structure.  Unfortunately, many companies start and stop with structure.  For example, GM has recently announced that it would have a head of Global Compliance.  If people still perceive that they will be punished for speaking up, then having an executive accountable for compliance practice alone is not likely to change the culture.

Given all this, here are three takeaways on corporate culture for managers and leaders.  First, unless you are near the top of the company’s hierarchical food chain, it will be impossible for you to change corporate culture.  In fact, even executives at higher levels sometimes find it difficult to change culture by themselves.  Think about living in another country with different cultural values and norms than your own; you have to adjust your behavior to the country’s cultural code.  Similarly, you have to adapt your behavior so it somehow fits in with the culture of the company you are working for.  Of course, you can deviate a bit but too much deviance and you will be rejected.

Second, by understanding the company’s cultural code, you can use culture to your advantage especially when trying to lead and influence.  For example, one of the companies I used to work for had a strong bias for being data-driven.  That is to say, recommendations or decisions had to be based on arguments based on analyses and good data.  In this organization, arguing by appealing to emotion would not get you very far.  Knowing this, those who were effective in this company made sure that they persuaded their key managers by always having solid data to back up their arguments. 

Third, you can create your own “mini-culture” within the larger corporate culture, as long as this is not too deviant.  Countries have national cultures, but they also have regional and even local cultures.  The southern United States can feel quite different than the eastern United States.  Let’s say that you are a manager of a customer service team in your company.  You have strong beliefs about how customers should be treated that may not be as much of a priority to the larger organization.  Within your sphere of influence, you can build a strong sense of customer service.  How?  Start by getting your manager’s buy-in and support.  Have a compelling vision that you can communicate to him or her, as well as to your team.  Then get your team involved and excited to make sure that they share and internalize the vision – it becomes not just your vision but everyone’s.  Then walk the talk.  Recognize team members who exemplify great customer service.  Spend time with customers yourself, and act on their suggestions and complaints.   You need not be merely a victim or product of the corporate culture.

 

Lane, H. et al.  (2009).  International Management Behavior (Sixth Edition).  United Kingdom:  Wiley.

OB Practices: Are They FEDUP?

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Free food!  Subsidies for buying hybrid cars!  No lay-off policies! Paternity leaves!  Employee sabbaticals! No more performance appraisals!  The list of perks, benefits and organizational practices is almost endless, and as many managers know, simply benchmarking or imitating practices or benefits what some of the “great places to work” employers offer is no guarantee that these practices will work for your company.  And by what will work, I mean whether or not they will lead to outcomes that will improve organizational and business performance.

In my OB class recently, one of my students brought up the potential benefits of salary transparency, a practice used by a handful of companies but is certainly not widespread.  There are a few good arguments that can be made for this practice. After all, publicly traded companies issue annual reports showing the compensation of their most highly paid executives.  You can easily access the average salaries of different professional groups (including professors) in public universities. In sports, we can quickly find out what the salary is of every professional player, and what their bonuses are.  And, some would argue, taking the mystery and black box out of salaries might help employee morale.

In my view, here are five questions to answer before one should consider implementing a particular organizational practice in an organization.  You can easily remember these questions using the acronym FEDUP.

First is Fit.  How does the practice align with the organization’s strategy and culture?  Zappo’s and Southwest are two companies known for having a “fun” culture. Tony Hseih, Zappos’s founder, and Herb Kelleher, former Southwest Airlines CEO, deliberately try to create an informal, almost wacky, atmosphere in their companies.   One of Zappo’s core values is “to create fun and a little weirdness.” Herb Kelleher used to dress outlandishly and encouraged his employees to do the same. Now imagine implementing these “fun” practices in companies where the culture emphasizes seriousness and even frugality.  Several years ago, a global company that had instituted “casual” Fridays, where employees could dress more informally one day of the week, decided to implement the practice globally. I was in Tokyo when the employees of its subsidiary received the e-mail memo. “Salary men” in Japan dress very conservatively, often in dark suits and white shirts.  This is part of their identity and they take pride in being recognized as such. Dressing informally made no sense to them at all.

Second is Evidence.  What is the evidence that this practice has worked?  Is there a solid theory or framework behind it? Is it likely to work in different industries?  Is it likely to work in different cultures? Fads are common in business, and imitating what your competitors are doing is not unusual.  This is no reason to adopt the same practice in your organization. Even when there is solid research behind a practice (for example, Collins’ concept of Level 5 leadership in his book Good to Great), it does not mean that this should be applied indiscriminately.  

Third is Difficulty of Implementation.  What are the barriers to implementing such a practice?  How difficult (and/or costly) will it be to implement? Is the timing right for your company?  In Pfeffer’s classic article “Seven Practices of Successful Organizations,” he identifies one such practice as self-managed teams and decentralization of decision making as basic principles of organizational design.  According to him, “organizing people into self-managed teams is a critical component of virtually all high-performance management systems.” However, the examples he gives include companies that have implemented true self-managed teams (e.g., Whole Foods) as well as companies that have implemented only certain aspects of the self-managed team concept (e.g., Ritz-Carlton).  In fact, there are very few companies that have implemented true self-managed teams, while virtually all corporations today actually have some form of team concept. Why are self-managed teams not more pervasive in the work place? For one, it requires a level of maturity and autonomy among team members that may not be there. Google at one point tried to increase spans of control and remove managerial levels but decided that their work force needed managers – not so much to supervise and oversee but also to coach employees, many of whom are very technical but relatively inexperienced.  Second, when a company goes through a major crisis, as Siemens did a few years ago with its bribery scandal, its new CEO implemented policies and compliance procedures that required employees to adhere to strict ethical policies. The timing for self-managed teams would not have been appropriate for this company.

Fourth are Unintended Consequences.  Are there things that could go wrong with the practice that you may not have anticipated?  Many years ago, Stephen Kerr wrote an article called “On The Folly of Rewarding A, While Hoping for B.”  The fundamental concepts of that article are still relevant today. Creating practices that focus primarily on extrinsic rewards (e.g., bonuses, stock options, status in the organization) will tend to attract people who are extrinsically motivated.  These individuals, while they may performing well in the short term to get their rewards, will not likely develop strong loyalty to their organization and will not perform good organizational citizenship behaviors. They are likely not going to be interested in behaviors that do not lead directly to these extrinsic rewards.  Is this the kind of organization that you want to build?

Fifth is Purpose.  Are you clear on what you are trying to achieve with this practice?  And is the outcome linked to business performance? A few years ago, I was advising a company on whether it should implement Six Sigma.  Senior executives had heard about its success in GE and other companies, and they believed that it might have some benefit for the organization, which had been experiencing some challenges with customer service.  They were not sure that Six Sigma would work, so they decided to “pilot” it in one department. Supervisors went through training in statistical quality control, and applied some of the Six Sigma tools. There was some improvement but it did not last.  For practices like Six Sigma to work, it has to start at the top, and the “philosophy” has to be embraced by senior management. By viewing Six Sigma as simply a collection of techniques that could be implemented in pieces, this practice never gained traction and was ultimately abandoned.

So should a company consider implementing salary transparency?  Let’s apply the five FEDUP. First on Fit. If your company has a culture of openness, where status differences are minimized, and where gaps in salary levels are not outrageously skewed, then this might work.  But I doubt that there are many companies who fit this criterion. Second on Evidence. There is surprisingly very little research that has been conducted on the impact of salary transparency, although we can certainly come up with many arguments on both the pros and cons of this.  So let’s pass on the Evidence test since we just don’t have a lot of information either way. Third on Difficulty. Implementing this practice would require a tremendous investment in time on the part of executives, and extensive communication throughout the organization. Is the company prepared to do this?  Is the timing right, especially when there might be some inequities that might have to be explained, or at least corrected, before taking this step. Fourth on Unintended Consequences. Will revelations of everyone’s salaries create feelings of inequity and unfairness, and is the company prepared to deal with these consequences?  Fifth on Purpose. So why exactly would a company want to implement this practice? What does it hope it will accomplish? Will revealing everyone’s salaries indeed lead to higher morale and productivity? Given all this, I would submit that salary transparency is not a practice that should be implemented by many corporations today without a lot of careful thought.

 

Kerr, S.  On the folly of rewarding A, while hoping for B.  (1995). The Academy of Management Executive, 9(1), 7-14.

Pfeffer, J.  Seven practices of successful organizations (1998).  California Management Review, 40(2), 96-124.

Stephen Covey and Global Management Principles Versus Practices

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When I was a young manager working for a Fortune 500 company, I signed up for a workshop that Stephen Covey was conducting at a conference center outside New York City.  I had just read his book, “The Seven Habits of Highly Effective People,” and wanted to learn more by listening to him live. He was a bit what I expected an author of such a book to be – sincere, straightforward, passionate about his beliefs.

When I learned that Mr. Covey passed away recently, I went back to this book that had such a profound influence on my professional life to see whether there were other insights I may have missed the first time around.  Over the years, I have always remembered to “begin with the end in mind” and to focus on the “important, and not necessarily the urgent” (although I have not always successfully followed this advice).

But something else struck me as I skimmed through the book.  In my classes in OB, I have interesting discussions with my students on what good OB practices are, and whether they can be applied to different companies in different industries.  One of the best articles on the subject is Professor Pfeffer’s “Putting People First for Organizational Success.” Here, he lays out seven OB practices that he claims have been proven to result in productivity and high performance.  They include selective hiring, employment security and self-managed teams. We have good debates in my classes as to whether these practices can apply to all organizations regardless of their situation, or to organizations in different parts of the world.

The “a-ha” for me was Covey’s insight that “Principles are not practices.   A practice is a specific activity or action. A practice that works in one circumstance will not necessarily work in another … While practices are situationally specific, principles are deep, fundamental truths that have universal application.”

There are many so-called “best” OB practices today that seem to work well for certain companies at certain times.  All you have to do is read the practices that Fortune describes in its annual Best Places to Work survey. Who does not know about Google’s free food, W. L. Gore’s self-managing teams, and GE’s Work-Out Programs, to name a few?

But Covey is right. Practices, including OB practices, are situationally specific.  Depending on the company’s strategy, its organizational goals, its cultural context, and its industry (among other things), these practices may or may not work.

But are there OB principles with universal application that lead to high performance and high commitment?  Based on my experience having worked for several different corporations, consulted with many others, having learned from some great minds in the field of OB, and having worked in many different countries, I would say there are at least five that I believe are universal.  First is to treat employees fairly and with respect. Whether it is a state-owned Chinese firm or a private enterprise in Brazil, organizations that uphold this principle will produce a higher level of commitment from employees than those that do not. The specific practices on how this principle is implemented will vary by culture.  In Western cultures, treating employees with respect might mean listening to their ideas. In Asian cultures, treating employees with respect might mean paying great attention to making sure employees do not lose face.

Second is to create a positive, motivating environment.  In Western cultures, this might mean such things as managers providing encouragement to employees, having an open-door policy, and conducting meetings where employees can express their opinions.  In Asian cultures, this might mean joining employees after work for karaoke, making sure they understand the history of the company, or even providing uniforms so employees can identify better with their company.

Third is to build self-confidence in employees.  Berating employees may instill fear and compliance but more than likely will build resentment and mere compliance, if at that.  We know from research that there is strong evidence of an “expectation effect” between teachers and students, as well as between managers and subordinates.  Sports trainers and coaches spend considerable amounts of time working on the mental aspects of the sport with their pupils, even with world-class athletes. In Western cultures, building self-confidence might mean giving some autonomy to employees or providing them with a challenging assignment.   In Asian cultures, this might mean offering them special titles or giving a team special recognition.

Fourth is to set high standards and expectations.   There is strong evidence from the research on goal setting that setting moderately difficult goals can be motivating.  GE popularized the practice of “stretch” goals. In Western cultures, setting high standards might involve meeting with subordinates to discuss goals and pointing to the alignment of these goals with department and company objectives.    In Asian cultures, this might involve having a senior leader of the company speaking to employees about the importance of meeting stretch goals for the good of the team and for the good of the company.

Fifth is to build collaboration and teamwork.  While talented individuals will continue to come up with inventions and innovations, breakthroughs today are more often than not the product of teams of individuals working together.  The image of the lone inventor or scientist toiling in isolation is somewhat exaggerated anyway; even Thomas Edison had a small team who worked with him to invent the light bulb. In Western cultures, building collaboration and teamwork might mean focusing on the right incentives and rewards to reinforce the right behaviors.  In Asian cultures, this might mean focusing on team-building to create a strong sense of group and company identity for employees, or on redesigning the work to build interdependence.

These are five principles that I believe represent good OB, are backed by years of research and that are universal.  However, let us also keep in mind, as Covey has wisely said, that principles are not practices. How these principles are applied and implemented will certainly vary and in this global world, Covey’s advice is worth heeding.