Friday, July 30, 2010

Time for Vacation!!!

Today is the last day of classes before we break for a three-week vacation. Excitement and the feeling of "I'can't-care'less-anymore" are palpable in the air. In the 41 C degree Madrid conditions, even cold beer does not save the brain from melting and, to be frank with you, studying has become a somewhat "too much" - the break is needed and welcome.

It is critical to balance work and leisure, but what is the proportion and how do we know the correct timing for that? In the article Economics of Happiness, the main idea is clear: wellbeing costs (and brings!) money, time and effort. Nobody wants unhappy, worn off and tired-brain employees, and we are welcoming those who rock up to work with a fresh tan, no bags under the eyes and a spring in their walk. Even when I was in my heaviest recruiting stages, irrespective of how desperate I was to get a person in, I would always advise him or her to take a week or so off, before starting the new job. I strongly believe that the return on this tactic is multi-fold.

Think about it in terms of psychological impact. We get over personal issues much easier than those we encounter in a professional or academic environment. Another Gallup article talks about career wellbeing and it compares loss of a job to a loss of a spouse:
One of the more encouraging findings was that, even in the face of some of life's most tragic events like the death of a spouse, after a few years, people do recover to the same level of wellbeing they had before their spouse passed away. But this was not the case for those who were unemployed for a prolonged period of time -- particularly not for men. Our wellbeing actually recovers more rapidly from the death of a spouse than it does from a sustained period of unemployment.
 There is a reason for people to have coffee breaks, there is a reson for people to have weekends and there is a reason to go on vacation. That´s exactly what I am going to do, so see you in a couple of weeks... will be refreshed and full of energy!

Thursday, July 29, 2010

Intelligence and disease

Smarts will get you far (maybe even farther than you need, as very often they are the smart alecs who get into the bushy situations). Still, linking IQ to the infectious disease burden is something totally new. I do trust the Economist, so I won't discard the theory offhand, yet it deserves consideration and critical analysis.

While I agree that the chances are higher that more educated people would wash their hands after using the restroom, it is very unlikely that they are less tasty for, let's say, a malaria mosquito or a treponema pallidum.  Besides, the experiments suggest that when people are not observed (or at least they are not aware of the fact) - 95% of university students will not wash their hands after having used the facilities.

Wednesday, July 28, 2010

Signature Processes

The big discussion of last week's Strategic Management class was around inability of other companies to replicate the successes of their competitors. On the surface, it is a piece of cake, but still - why is there only one Wal-Mart and why has Continental Lite failed trying to repeat the success of Southwest Airlines? All information is publicly available and we know exactly how each one of those praiseworthy enterprises have built their successes, yet nobody have been able to do that stunt again.

Glow: How You Can Radiate Energy, Innovation, and SuccessThe answer might be in the research done by Professor Lynda Gratton at London School of Business. In her recent book Glow she talks about signature processes as opposed to best practices. The Wikipedia definition of a best practice says:
A best practice is a technique, method, process, activity, incentive, or reward that is believed to be more effective at delivering a particular outcome than any other technique, method, process, etc. when applied to a particular condition or circumstance.
 Elaborating on this definition, it is easy to see that the driving words are "technique", "process" or "method" - those are action words. Such are easy to document, map, describe, and therefore - replicate. When you see your neighbor mowing the lawn at 10 in the evening to avoid the excruciating Madrid heat during the day, you might realize that you are being a fool doing that at 3 in the afternoon (which guarantees you skin cancer, a heat stroke and disdainful looks of passers-by) and copy your neighbor's way of labor organization, which in this particular case will be considered best practice.

The difference of a signature process (practice) is that it is awfully easy to understand, but virtually impossible to replicate. Consider a couple of examples provided by Gratton:

All those processes are public, everybody knows about them, still nobody has been successful in replicating those. That constitutes the basis for competitive advantage, and establishes the ground for future success, just because you can be sure that it is among those few things that the competitors will not be able "steal" from you.

The interesting commonality of those signature processes is that all of them reside in the HR-related areas. The moral of the story? People/change/culture innovations or practices are critical to your business profitability in the long run. Technology (no matter how complex it may be) or patents will not protect you for long - anything can be back-engineered or reconstructed and slightly modified and you are facing fierce competition in no time. Thus, to avoid the red oceans of competition, make sure you find your own value-adding people processes that will leverage your business capabilities and distinguish you in the market.

Saturday, July 24, 2010

Putting a value on training

Life is funny and full of coincidences. No sooner had my MBA classmate Federico sent out an e-mail to the entire intake about the IE HR Club initiative on peer capacity building, that McKinseyQuarterly published this article the excerpt from which I am copying below. The coincidences are:

  • Federico and other HR Club members have come up with this initiative because building skills (particularly "softer" ones) is crucial in the MBA environment and very often can be overlooked because of the strict demands of the "core" MBA program;
  • IE HR Club and McKinsey posted their learning & development concerns in the same week, and
  • Federico works for McKinsey :)
A series of workshops and master classes will be scheduled shortly. They will be conducted by fellow students who have significant expertise in their respective areas and professional trainers. Everybody is welcome to contribute. I will be keeping you posted on the development.


Putting a value on training

Training programs generate greater value for organizations when the curricula reflect key business performance metrics. Testing real-world outcomes is crucial.

All organizations train their people, and most spend significant sums doing so. Yet they generally don’t have any idea whether they’re getting any business value from training. Beyond teaching new employees the specifics of their jobs, most companies train staff in areas such as leadership, communications, performance management, or lean operations. But they typically measure training’s impact by conducting surveys of attendees or counting how many employees complete courses rather than by assessing whether those employees learned anything that improved business performance.
This approach was, perhaps, acceptable when companies had money to spare. Now, most don’t. Yet more and more, organizations need highly capable employees—90 percent of the respondents to a recent McKinsey Quarterly survey said that building capabilities was a top-ten priority for their organizations. Only a quarter, though, said that their programs are effective at improving performance measurably, and only 8 percent track the programs’ return on investment.

Tuesday, July 20, 2010

Life in Graphs

Who doesn't like graphs? Pie-charts, curves, 3-D, shaded areas... they are cool and they are so easy to hide behind, because people trust charts. Really: you can put together a 5-page report and they still won;t be convinced, but as soon as you pull up a graph, the audience is yours. We are such suckers for visual information nowadays. Well, the attention span has decreased in general to the size of a tea spoon, hence no song longer than 4 minutes or an e-mail longer than half a page. Why was I telling you this? Ah yes - back to graphs. I have got an e-mail from a friend (thank you, Bruce), which intended to heighten my spirits, and it did. After I laughed for a few minutes, I actually started realizing how seriously true those charts were, and now I am going to share a couple of them with you.

1. Home gym. When we buy something like this we give ourselves promises. Nearly New Year resolutions. Signed in blood. Breaded and dusted. What happens a few days later? It's like with children and puppies. Your kid will cry your brain out that he or she wants a little doggie, and will call you the best dad/mom in the world the moment you buy the craved pet. Two weeks later you will have to walk the poor creature yourself. Attention span is not to blame in this instance, but rather the desire for novelty, which is rapidly becoming the plague of the 21st century. It is the desire for novelty that makes us buy more and more, transforming us into a consumer society. Also, we want everyone to know that you have just bought the latest home gym, so consumption must be conspicuous, otherwise it's less fun. Thus, next time you go shopping, make sure those D&G letters are really big and are featured in a prominent place on the piece of clothing you so ardently wish to possess.

2. Lemons and Facebook. I have already posted a number of blogs on Social Media and 2.0 applications. Consider how dependent we are becoming on those seemingly innocent websites: LinkedIn (now you are almost expected to have a full page there with recommendations and professional societies mentioned in order to land a good job), Facebook (if you are not there, you are risking to miss all the cool events, friends' updates, and more often people consult Facebook for contact information of their connections) or Twitter (the best web marketing tool ever). Is it going to get worse? And by "worse" I mean "better". No, I guess I mean "worse".

3. Vibrating friends. We are surrounded by gadgets. There is not a single meeting/class/dinner/picnic/bull run that I have attended, where there would not be anything beeping, zooming, ringing, stroking or vibrating. It is haunting, really. Well, my ring tone is haunting too (Vertu - the best!), but in a good way. Have you noticed how many times people check their Blackberries, iPhones, youPhones and other pieces of technology to see if someone still remembers of their existence in this universe. Maybe global connection is in fact total disconnection and the only thing left that is real is the broadband?

Monday, July 19, 2010

A Purpose Driven Career

A few weeks ago a professor mentioned that when deciding whether you should go for something you like or something that you are good at, it's best to opt for something you are good at and you'll end up liking it. I am not sure how much I agree to that statement, but I firmly believe that if your mind is set on a long-term goal, you will certainly get there. The question is not how or when... actually, there are no questions at all except one: what is it that you are truly passionate about and you want to dedicate your life to?

A Purpose Driven Careerby Leslie Berliant
As consciousness about environmental and social issues rises, so does the number of people who would like a job with purpose. But how do you become Director of Sustainability or Chief Environmental Officer at a Fortune 500? What is the best path to becoming VP of Strategic Marketing and Fun or Head of Innovation and Ecology at an environmentally friendly company?

Experts say there’s no one way to land a job that reflects your values. Chances are that no matter what you have been doing in business, you have transferable skills that can help you find a position in sustainability or corporate social responsibility (CSR). Companies built around principles of sustainability need to fill all of the roles of traditional companies: sales, finance, marketing, operations, etc. Traditional companies looking to become more sustainable need people that are passionate about the issues while skilled in business practices. Individuals in these roles must also demonstrate how more than ever sustainability affects the bottom line though energy efficiencies and cost savings.

Aaron Frank, Director of Environmental Affairs at Disney Corporation, suggests that you carefully think through
where you fit into the organization. “Corporations are looking for a strong team of people,” says Frank, “there is room within sustainability for people with expertise in external communications, research, operations, internal communications, and the like. If you don’t have direct experience in sustainability but you have strong business skills, look for companies with departments large enough to require and accommodate people with your skills.”

Salaries vary based on size and location of the company. Martin Kartin, who runs a boutique retained search firm, says most Director of Sustainability salaries are in the $100,000 to $175,000 range.

According to Chuck Bennett, Vice President of Earth and Community Care at Aveda, while people need to have an
interest in their area of responsibility, a business background is very valuable. Previously, Bennett served as Head of Environmental Safety at Nabisco and Head of Environmental Affairs for Coors Brewery. He maintains that people coming out of the business world with an interest in environmental issues can be very effective even if there is a learning curve on the issues. “A lot of being successful is knowing how to get things done as much as it is knowing what you want to get done,” Bennett says.

Kartin concurs. “For a company that wants to be sustainability conscious, give me the business mind with the environmentalist heart,” he says and adds that LOHAS companies looking to compete with traditional companies need to hire people who understand those competitors.

Frank advises to consider the size of a company. “Larger corporations have the opportunity to make a larger impact, but it takes longer to create change,” he says. “At a smaller company change can happen more quickly.”

Roy Notowitz of Generator Group, an executive head hunting firm in Oregon also has some suggestions for the
eco-job seeker. “The key is identifying transferable skills, finding connections, and understanding your competencies in order to convince employers you will be successful in a position.” Notowitz recommends getting involved with interest groups and organizations working on initiatives globally that you would like to work on at a corporate level in order to meet like-minded people who may eventually need to hire leaders and managers.

Demonstrating a history of innovation and learning ability helps, too. In some cases, a person stepping into a sustainability or CSR management position will find themselves having to define their job and their role within the organization while navigating a corporate culture that may not be completely receptive to change.

In these difficult economic times, it is critical that sustainability activities benefit a company’s bottom line. “In many cases, increasing efficiency has economic benefits,” says Disney’s Frank. “In cases where there is an initial cost, there’s often some long-term value to the company.” Notowitz agrees that enhancing a company’s profitability and helping move the corporation toward its goals is crucial. Sustainability and CSR departments that cannot demonstrate cost reduction or brand enhancement run the risk of being rolled into more traditional marketing and communications departments or completely cut during economic downturns.

For those who might be looking to enhance their education before looking for a job, Bennett has some thoughts. “We love MBAs with a strong commitment to environmental sustainability, like those coming out of the University of Michigan or the Presidio Green MBA programs.”

“Those just beginning their career in a sustainability or CSR department need street smarts and a strong work ethics in addition to a broad educational background,” adds Bennett, who suggests getting some internship experience, too. “Commitment and willingness to work is important because these jobs tend not to be easy,” Bennett warns. “People who come in thinking everybody will totally align with them and help them get things done will be really disappointed.”

Michael Dupee started out with Green Mountain Coffee in an entry-level position and also led the internal environmental Committee. After leaving to earn his MBA then working as an investment banker at Goldman Sachs, he returned to Green Mountain in a newly created position, Vice President of Corporate Social Responsibility. “It’s great to spend my days focused on issues of social and environmental impact,” says Dupee. “The challenge of integrating those issues into a profitable growing business is terrific.”

As far as job satisfaction goes, Kartin says it’s important to remain patient. “Those people at companies where sustainability is not a new paradigm—Ben and Jerry’s, Burt’s Bees, and others—reap the job satisfaction in spades. But for people at companies where sustainability is a new approach, the jury is still out based on how effective these people are really going to be in these newly created positions.

Mike Duppee adds, “Many people have romantic notions about jobs like mine but it’s important to remember it is still a job—some amazing days, some really tough days, but most of it is great.” 

Leslie Berliant is a partner at BLU MOON Group, a marketing and communications firm that specializes in cause marketing, and co-founder of BLU MOON Foundation.

Sunday, July 18, 2010

Power to the brain!

Brain is amazing. It is hard to imagine a more complex and powerful mechanism on the planet. The sheer amount of neuron connections is approaching zillions. Even the smartest people on this planet (read: "geniuses") use only a pitiful 10% of its full capacity. While it is difficult to train yourself to become the next Einstein or Curie, there are ways to improve your mental processes, including speed of reaction, memory and other functions.

First, you can have your exercise routine. Have you noticed that the more Sudoku you solve, the easier it gets? It is because your brain identifies certain patters and it is easier each time to "see" the bigger picture. What if you do the same trying to multiply, divide, subtract, add, raise to power, extract a square (cubic???) root, etc? You will get better and better at it, I promise!

Secondly, there is a plenitude of reading material on exercises for your brain - any search on the keywords such as "brain exercise", "mind training" and similar will return you dozens of hits at

Thirdly, you can try specialized programs targeted at enhancing your mental capacity and agility. I would only mention two:

  • Mind Gym: it is a series of books (now also supplemented with many exercises online), which gives you the basic theoretical explanation of specific mental processes (i.e. how your brain works) and suggest certain exercises that you can do. Most of them are highly experiential, so it is far from sitting at home with a pencil and a sheet of paper, but rather challenging: going out into the field and trying it off on your own skin.
  • the best "brain training" software I have seen so far. Fun computer games categorized into several broad groups (e.g. memory, attention, speed, spacial orientation, etc.) are automatically adjusted to your level, hence you will never be complacent: the challenge will be just right. Besides, after an assessment the program will recommend a training program for you, and you will be able to track your performance over a period of time. It is such a fun feeling to see yourself getting better!
Without sounding too commercial, I urge everybody to invest into personal development. Otherwise, who knows... the brain might just rust :)

Just for the weekend, here are some of famous optical illusions to muse over when there is nothing to do :)

(click on the pictures to enlarge them)

Do you see four people?

Do you see a face? Or a word "liar?                     

Do you see the word "LIFT"?

(women are able to spot the word "LIFT" easily; men find it difficult to see it)

How many horses in this picture? 
The Answer is 7. (if you see more than 5 you are smarter than I am)

Saturday, July 17, 2010

Green MBA

As I have been browsing through materials for our new group project on organic farming (can you imagine a switch from a tea shop to digitally controlled farm production???), I came across some interesting facts on the LOHAS website about the "green" tendencies in business education:
The good news and the bad news about green MBA growth is embedded in the results of the most recent Aspen Institute survey of graduate business schools. Here are some illuminating findings from "Beyond Grey Pinstripes, 2007-2008."
• Between 2005 and 2007, elective courses per school featuring some social/environmental content increased by 50%.
• Between 2005 and 2007, elective courses per school that were largely dedicated to social/environmental issues increased by 20%.
• Between 2001 and 2007, the percentage of schools that require students to take a course dedicated to business and society issues increased from 34% to 63%.
• 35 schools currently offer a special concentration or major that allows students to focus on the social and environmental issues inherent in mainstream, for-profit business.
• 5% of business school faculty have published academic research on social or environmental topics in leading journals.
While it is difficult to argue with the facts, I have doubts whether the turn towards sustainable development is a fad or whether the faculty and management of the leading educational institutions have genuinely bought into the idea of going green. So far, I am getting conflicting messages from those who are running the MBA programs and the professor body. The selling point is about sustainability and social responsibility. However, the moment you go to class, it's about cost efficiency and process optimization. At the same time, I don't want to remove the onus from the students themselves. The same article suggests that "only about 20 percent of the students care deeply about social and environmental issues".

Thus, thinking out of the barrel is fashionable and cool, but far from reality, alas...

Thursday, July 15, 2010

Curry: How Much Spice Is Good For Organization?

I love curry: it's spicy, there is a lot of it, it is easy to make, and you can have lots of friends over for some curry with basmati rice and an assortment of sambals. That's what I did a couple of days ago. Spain being Spain, only one Italian turned up on time. An hour and a half tardiness is considered fashionable. It is a great way to allow the host to have uninterrupted conversations on subjects of common interest with those who are unfortunate to follow the old maxim "punctuality is politeness of kings".

The main course for the dinner was red Indian curry (for some strange reason I was cooking beef, but please let's keep that fact secret). When we started eating it transpired that there are people who love spicy food and there are those who would need at least five glasses of lassi with it (in addition to the whole performance with tears, moans and groans about the injustice of this world and existence of chili peppers). The food was a success, of course, in my eyes... and whoever disagrees is not invited to my place ever again.

As usual, I started thinking of parallels and connections in the organizational context. Curry - you cannot be impartial - is either loved or loathed. There is no golden middle and there are no gray areas. How do you make a perfect "organizational curry" without disappointing anyone? The problem is that you add chilies at the very beginning, after you are just done sauteeing onions. You cannot make it more or less hot (well, surely you can by adding extra chilies later or diluting it with yogurt but those are culinary perversions I don't want to ruminate).

Think about an event, a policy, a project - anything in your workplace - that you are going to launch/introduce/set up or whatever... how much spice can you add? Add none at all and it will be bland. Add a lot and you will be pleasing a few selected junkies. How much is just right? Plus bear in mind that there are always those vegetarians, lactose intolerant and curry-allergic. By the way, I am apologizing for picking on those categories (been a vegetarian for two years myself), but I just want to make a point that there are always certain categories of people who fall out of the general picture and need special attention.

An easy example would be the air-conditioner rule. Do you know that if there are more than 5 people in the room, somebody is bound to ask to turn the AC either up or down? It would not be so funny, if it weren't so sad. Nowadays, in big corporations there is an international standard of 22.4 degrees Centigrade unless another unanimous agreement in reached about the room temperature. What if the issue is merely a notch more complicated than the freaking temperature-changing and air-dehydrating contraption? Then the companies resort to the services of....consultants! Yes, please, Mr and Mrs Bain and McKinsey, come and help us with the organizational kitchen. The old wisdom still stands though: too many cooks are unlikely to make a good boeuf bourguignon. Scrambles egg - maybe, but we are not in the business of fast-food solutions.

I guess that the point of this post is to make myself aware (and whoever is reading this too) that if it is difficult to cook a dish of curry for five friends (and the curry turned out delicious, trust me!!!), it will take much more time, efforts, expertise, experience, huffing and puffing, groaning and moaning, and other words normally associated with hard and unpleasant labor before you get the job done.

Bon appetit!

Tuesday, July 13, 2010

2010 Hiring Trends

I am getting extremely excited reading the various prognoses for the netx couple of years when it comes to hiring. As I graduate in May 2011, there are all indications at the moment that it´s going to be a pretty hot market out there, and even though it is not clearly stated in the companies´ preferences, the historical evidence proves that the demand for MBAs increases after large (cataclysmic) changes in the economy and society in general. This happens mainly because while those changes were happening, the smart students were crunching numbers and preparing case presentations, analyzing what is happening around them. Thus, they are perceived to be better prepared for the new market and conditions.


Employers share their plans for rest of 2010

Today marks the midpoint of 2010. At the risk of sounding old, can you believe we’ve already gone through half of the year? I feel as though we were just talking about what to expect inthe first andsecond quarters of this year. Yet, here we are looking at the second half of 2010  in the newly released Job Forecast from CareerBuilder and USA Today.
As you might expect, employers are cautiously optimistic when it comes to hiring. Between July and December, 41 percent of surveyed hiring managers plane to hire new employees. Approximately 20 percent of hiring managers plan to hire full-time, permanent employees in the third quarter, which is similar to figures in both the first and second quarter of this year.
What does this mean? Simply, don’t expect a hiring sea change in the next three months. Employers have held a consistent approach to hiring this year and plan to continue. Although everyone (employers and job seekers alike) would like to see a boom in new workers, take heart that companies aren’t looking just to boost their payroll momentarily and then have to downsize — they’re looking to fill positions for the long haul.
However, for those of you looking for work, here are the sectors where employers plan to begin their hiring. Note that the focus is on positions that bring in revenue for the company:
  • Customer service (25 percent of hiring managers)
  • Sales (22 percent)
  • IT (18 percent)
  • Administrative (13 percent)
  • Business development (10 percent)
  • Accounting/Finance (10 percent)
What to expect for the rest of 2010:
1. Emerging jobs: Much of the year’s hiring will be in positions that either didn’t exist a few years ago or weren’t in high demand until recently. According to the survey, 24 percent of hiring managers will recruit for jobs in social media, green energy, cyber security, global relations and health-care reform.
2. Employees jumping ship: Some HR professionals worry that an improving economy could mean their top performers will leave the company in pursuit of another job. Fifty-six percent fear their top talent will leave, and the survey finds that 29 percent of workers do plan to change jobs when the economy is in better shape.
3. Skilled labor is still hard to find: Although the job market has no shortage of applicants, it does have a shortage of qualified workers, according to employers. Twenty-two percent of employers report that they are having difficulty filling positions with qualified candidates. IT, customer service and communications are suffering from a shortage of qualified workers, say hiring managers.
Looking ahead at Q3:
Most job seekers want to know three things: Is anyone hiring? Where are they located? How much will they pay?
Is anyone hiring?
Yes! Although most employers don’t plan to hire new employees, approximately one-fifth are.
  • 21 percent of employers will add full-time, permanent headcount.
  • 8 percent plan to downsize.
  • 65 percent don’t anticipate a change in headcount.
Where are they hiring?Hiring seems to be occurring at the same pace throughout the country.
  • 22 percent of Western employers intend to add full-time, permanent workers.
  • 21 percent of Northeastern and Midwestern employees say the same.
  • 20 percent of Southern employers plan have the same plan.
How much are they paying?
While many employers don’t foresee any salary raises or cuts, some do. However, most employers who will be giving raises expect them to be on the moderate side.
  • 42 percent of employers do not plan any change in salary levels.
  • 31 percent expect to see an increase of 1 to 3 percent.
  • 12 percent plan increases between 4 and 10 percent.
  • 1 percent anticipate an increase of 11 percent or more.
What do workers think?The recession has caused many workers to reevaluate their situations, from expenses to education to employment. The economic troubles of the past two years have not been kind to some companies, as 25 percent of workers admit to having a worse opinion of their employers as a result of the Great Recession. On the other hand, 14 percent have a better opinion and 61 percent have unchanged views.
Why do workers want to leave?As mentioned above, 25 percent of workers plan to leave their organizations in the next 12 months. Why?
  • 30 percent of workers blame the recession. They feel overworked, the climate has changed, and resentment lingers from layoffs.
  • 33 percent of workers believe they are overqualified for their positions.
  • 23 percent of workers are not interested in their work.
Of course, you might not be surprised to learn that the number one reason employees would stick around is an increase in salary. If that’s not an option, then employee recognition will do.
You can read more in the complete forecast here. Do you agree with what employers say or do you see a different future in the coming months? Let us know.

Monday, July 12, 2010

Stories of Mass Delirium

Sometimes people are irrational. At times, they are illogical. There are instances when they are nuts!

Last weekend I went to Pamplona (Spain) for the San Fermín Festival. It's an annual one-week long festival dedicated to the local patron saint and the most prominent feature of the event is daily running with the bulls and the subsequent encierro and afternoon corrida. Nobody has ever been able to outrun the bulls (not even athletes) and every year there are injuries (only I saw two guys being carried away on a stretcher in two days). The latest death was recorded last year and the death count amounts to 15 since 1911 when the official runs started.

What makes people do such crazy things? If we take someone out and ask him (her) run with the bulls, most likely the answer will be "No, thank you very much". However, as the crowd swells, its members become braver, more reckless and - yes - crazier. A lot, surely, has to do with collective unconscious, a term was coined by Carl Jung early in the last century. A bit later such behavior was better described in terms of herd instinct. I recall from my Psychology classes that such instances can be categorizes as chronotypes and are subject to a host of conditions, less of star positions and wind movements. Without getting too philosophical about it, the question is - what makes people flock to Pamplona each year, put on white clothes, red neck scarves and belts and engage in one of the most dangerous and seemingly pointless activity of running with the bulls and teasing them afterwards?

If we could find the answer to this question, it would be so easy to mobilize masses of people in no time, who would willingly and eagerly engage in a collective effort for whatever cause. I fathom that the history gave us such examples:

Analyzing the common elements of the above, it is possible to identify certain common elements:

  • sense of unity and belonging
  • high emotional charge
  • high level of dissatisfaction/perceived danger/extreme pride (something worth to fight/live/die for)
  • willingness to succeed
  • leaders and, consequently, vision for change
Now if we compare these five against any mass change theory, what is the overlap? Very significant I would say... So should now we be reading cases from human history alongside business cases in the MBA programs? Because if senior leaders can understand the underlying forces that make people perform at the limits of their capacity, put in an extra effort, go an extra mile and be loyal to the work they are doing, at the end of the day it is the only thing that matters in a manager's job.

The weekend was too emotional for me with the whole Pamplona and the World Cup story, and I might not be totally rational drawing these conclusions, so I am welcoming you to prove me wrong. There is only one thing you cannot take me on:


Thursday, July 8, 2010

Global forces: An introduction

McKinsey is launching a research initiative on identifying and analyzing the factors that shape our immediate future. I found this introductory article extremely insightful. As you read through, my observations on people implications are in red.


Global forces: An introduction

Five crucibles of change will restructure the world economy for the foreseeable future. Companies that understand them will stand the best chance of shaping it.

“I never think of the future,” Albert Einstein once observed. “It comes soon enough.” Most business managers, confronted with the global forces shaping the business landscape, also assume that their ability to sculpt the future is minimal. They are right that they can do little to change a demographic trend or a widespread shift in consumer consciousness. But they can react to such forces or, even better, anticipate them to their own advantage. Above all, they ignore these forces at their peril. Another quote that I like about future is: "Future is already here; it is just distributed unevenly".
Business history is littered with examples of companies that missed important trends; think digitization and the music industry. Yet this history also shines with examples of companies that spied the forces changing the global business scene and used them to protect or contribute to the bottom line. Companies ranging from insurers to energy producers did precisely that in embracing the growing social concern about climate change. So did Wal-Mart Stores in applying technology to automate inventory management and reduce costs dramatically for the company and its suppliers.
The fact is, trends matter. Systematically spotting and acting on emerging ones helps companies to capture market opportunities, test risks, and spur innovation. Today, when the biggest business challenge is responding to a world in which the frame and basis of competition are always changing, any effort to set corporate strategy must consider more than traditional performance measures, such as a company’s core capabilities and the structure of the industry in which it competes. Managers must also gain an understanding of deep external forces and the narrower trends they can unleash. In our experience, if senior executives wait for the full impact of global forces to manifest themselves at an industry and company level, they will have waited too long.
For much of the past year, a team at McKinsey has revisited and retested our assumptions about the key global trends that will define the coming era. We have identified five forces, or crucibles, where the stresses and tensions will be greatest and thus offer the richest opportunities for companies to innovate and change:
  • The great rebalancing. The coming decade will be the first in 200 years when emerging-market countries contribute more growth than the developed ones. This growth will not only create a wave of new middle-class consumers but also drive profound innovations in product design, market infrastructure, and value chains. With Europe and Japan dying out, US will soon start encouraging people from Latin America to immigrate to the States. China will have to address the gender imbalance caused by the one-child policy. What are the sources of the future talent then?
  • The productivity imperative. Developed-world economies will need to generate pronounced gains in productivity to power continued economic growth. The most dramatic innovations in the Western world are likely to be those that accelerate economic productivity. Is not it easier to encourage people consume less? Or is it too late? 
  • The global grid. The global economy is growing ever more connected. Complex flows of capital, goods, information, and people are creating an interlinked network that spans geographies, social groups, and economies in ways that permit large-scale interactions at any moment. This expanding grid is seeding new business models and accelerating the pace of innovation. It also makes destabilizing cycles of volatility more likely. Right... the global recession has just proved how real and palpable it is. Some countries claimed they would not be touched by globalization and were proved wrong (e.g. China with their spectacular GDPs in the last decade thought they would not be affected... well, with plants shutting down or shifting onto 3-day week around the world, the demand for Chinese exports decreased too).
  • Pricing the planet. A collision is shaping up among the rising demand for resources, constrained supplies, and changing social attitudes toward environmental protection. The next decade will see an increased focus on resource productivity, the emergence of substantial clean-tech industries, and regulatory initiatives. Do we need new skills for this? As one speaker this week said, there are MBAs who graduate without a heart, and there are environmental specialists who know everything about butterfly sex, but can't construct a basic cash flow. How do we bridge the gap between the current educational offering and the new demands of the future?
  • The market state. The often contradictory demands of driving economic growth and providing the necessary safety nets to maintain social stability have put governments under extraordinary pressure. Globalization applies additional heat: how will distinctly national entities govern in an increasingly globalized world? Visas, international mobility, expatriate remuneration, double taxation... HR hell in flesh!
Our thinking is exploratory rather than definitive. Precisely how these forces will unfold—and, as important, how they interact—is very much a work in progress. Still, our research, extensive one-on-one contacts, and broader survey data give us confidence that these topics should be framing every organization’s strategic conversations about how best to chart its future course. Over the coming year, McKinsey will dive deeper into each of these five areas to draw out the business implications and inform the strategic debate. We can be certain that this new era will not evolve smoothly. Future economic crises—quite likely, major ones—are inevitable. And management theory for the 21st century, the first with truly global enterprises, is being invented in real time, as thousands upon thousands of companies make it up as they go.
What we do know is that the forces driving the emergence of this new world are too powerful to be denied and that running a 21st-century company is exponentially more complex than running a 20th-century one, of any size. Companies must pay attention to more stakeholders, more regulations, and more risks—and watch to see what their customers are tweeting about them. That complexity is greater, but so, we believe, is the opportunity.
Even the most talented strategists will have, at best, incomplete knowledge of what comes next. But from our experience, we know that an understanding of the forces defining the future will also provide the best chance for seizing it.

Ambassador'ing the Employer Brand

Do you teach your employees how to handle visitors? Most likely, you would be focusing on security issues, like not letting them in without a valid pass, or insisting on accompanying them wherever they go, and so on. However, (just like the theater begins with a cloakroom) you company begins with the first encounter. Trust me, it does now matter, whether the first person a visitor will meet is a janitor of a vice president --- the first impression is always the most lasting.

It is particularly important now, when the war for talent is becoming more and more rampant. When I worked for Shell in Moscow, we used to have an HR Marketing Analyst, who was responsible for promoting HR as a function internally withing the company and the Shell brand as an employer outside. Now this gives a totally new perspective not only to the human resources management profession, but also sends out a distinct message how much the company is concerned about its employees and the image it projects into the wider community.

The following video is a good illustration of the concept that EVERYONE is an ambassador of a brand one way or another. How do we embrace this idea and how we act upon it might be the ultimate competitive advantage.

Tuesday, July 6, 2010

Story-Telling Dinner

Story-telling is wider and wider recognized as one of the key competencies of a modern manager. With new technologies invading our brains, there is a severe and ruthless competition for brain space, attention and processing capacity whenever we receive information. It is the ancient and yet most efficient art of story-telling that captivates the minds, mesmerizes the eyes and reaches the hearts of the listeners that comes to the fore nowadays.

The first event of the IE HR Club was organizing the story-telling dinner at the Mood restaurant on Monday earlier this week. The instructions were simple: think of a story of a mind-wrecking success or a spectacular failure and come and tell it to the other participants in an engaging manner. I should say we genuinely enjoyed the variety of stories that the IE students and alumni brought to the table (literally!!! as the food was nice!). We spent three hours in a relaxed and friendly atmosphere, sharing life experiences of each other. Interestingly enough, even though it was an option, nobody picked a borrowed or a fictitious story, and that surely had added to the overall feeling of the evening. Some were very personal, and the emotions behind those were true and intense.

Each one of the participants will receive an individual feedback, which will be an aggregated report compiled from the inputs of everyone else. The observations commonly shared around the table are that there is a dire need in upping the game on the art of story-telling in IE, and there definitely has been a lot of learning in the event. Gary Stewart, the Executive Director of the Venture Lab, has concluded the event with his personal story and several pieces of advice to the participants:

- Timing and Rhythm are key (attention span is short, time your story right)

- Start with a hook (like a movie trailer)

- Empathy (make it feel genuine)

Since there is a lot of interest, we would be willing to listen to your event suggestions or comments on the topic.

Monday, July 5, 2010

3 Lessons from Granada

Wow! This was a fun weekend. Yes, Term 1 of my MBA journey is over and surely we took the opportunity to get out of Madrid to recharge our batteries (sufficiently depleted by the exam week) and explore the beautiful country of Spain further. What what I have seen so far, Granada takes the cake with its profoundly relaxed and laid-back provincial atmosphere, finger-licking traditional cuisine, free tapas and vast opportunities for shopping. Surrounded by Sierra Nevada mountains, it is a perfect get-away location for whichever purpose imaginable.

There were four of us in the car: my classmates Dana and Niels, and my friend Olga, who was visiting me from Moscow. I believe that four is the perfect number of people for a road trip without conflicting priorities (such as sight-seeing and shopping, even though some believe that shopping is indeed sight-seeing), and if any tensions arise, they could be easily managed.

I am deviating, however... When I was talking about story-telling in one of my previous posts (, I failed to mention that you can get inspiration for your stories from wherever: films, books, your own thoughts, borrowed stories from others, observations - the repertoire can really be boundless. Driving back from Granada to Madrid, I had enough time to think about my experiences of those three days, and they have boiled down into three important insights, which I am going to share with you now. I will codify them as:

  • View from the Top
  • 6th Gear, and
  • Leapfrog
Lesson # 1: View from the Top
On Saturday, one day after our arrival in Granada, we decided to take a drive into the mountains and enjoy the magnificent vistas of the Sierra Nevada mountains. Getting up at 8 am on Saturday, when you are on vacation, is a noble deed in itself, traditionally rewarded in Granada with a cup of coffee, croissant with butter and jam and a glass of freshly squeezed orange juice. Getting out of the city was not an issue since all respectable Spaniards prefer not to grant the world with their presence well into the day, so the roads were clear and the drive was pleasant. 

As we were driving up into the mountains along a winding serpentine road, the weather was getting a bit gloomier and it started drizzling. Finally, at the mark of 2750 m above the sea level we stopped and (being awfully excited to see the snow-white mountain tops in the middle of summer) got out of the car. That was freeeeeeezing!!! The wind was blowing and I can promise - the snowflakes were circling in the air. By all means, we were not ready to go out into that kind of weather.

Insight: in the organizations getting to the top always looks so attractive and most ambitious people have it as one of their career goals - to reach an executive position and being able to make important decisions affecting the entire company. However, in many conversations that I have had with senior executives, there are certain trade-offs. Apart from longer hours, serious emotional strain, non-existent work-life balance, etc., there is something else. At the lower levels in the organization, it is about teamwork and helping each other and the general atmosphere of camaraderie and friendship. Then, as you get promoted you notice that it's not that sunny at the top. You notice that it is cold and everyone is watching their own backs. Getting to the top unprepared can result in a very quick roll down if you do not have a senior protector and adviser.

Lesson # 2: 6th Gear

Niels and I took turns driving both to and from Granada. It is a relaxed 4-5 hour drive: the roads are good and the weather was more than great - it was fantastic! Normally I drive fast and I like the feeling of control, hence my affection for cars with mechanic gear; automatic cars just don't give you that "umpf" feeling.

I have always been driving cars that have a 5-gear switch box, and naturally I have not been closely inspecting the details of a weekend rental car. Only on our way back Niels has casually mentioned to me as I was cruising on the highway in the 5th gear that it was a 6-gear car. It means that all that time I had the hidden potential to optimize the fuel consumption, which I had not taken advantage of.

Insight: often people are not aware of the hidden resources within themselves and their surroundings. Moreover, we are able to convince ourselves that there are none and give logical arguments why there cannot be anything. Still, we are so frequently proven wrong (sometimes by ourselves). Yes, we are faster, stronger and smarter than we think we are (not to confuse with overconfidence and incorrect self-image!!!) - all it takes is taking a closer look and tapping into the potential lying within. That's why feedback and (self-)observation are so important: they help us get rid of blind spots and assess our capabilities more objectively.

See related: Coaching.

Lesson # 3: Leapfrog

Have you ever played leapfrog on the road? If you have not yet - please do not: it is silly and dangerous hormone enticed activity. Basically, you are competing with another car(s) in who's faster by repeatingly overtaking one another. Obviously, it creates hazards on the roads for other drivers as well and I am quite sure it is illegal in some countries.

Still, on the way back to Madrid there was this black Mercedes, which accompanied me for 150 kms or so and we played a sort of leapfrog. Well, first of all, I had no intention of proving anything to that (aged and seemingly well-mannered man and his, apparently, wife), and secondly, it was a four-lane highway separated in the middle, so we never overtook each other in a true sense of the word. What we did was switching into the fast lane and speeding past a couple of slower moving cars and then getting back into the slow lane again. Thus, we took turns: now and then either he or I would be in front and then we would repeat that trick again.

Insight: apart from the obvious insight of the danger of such (or similar) behavior on the road, there are some thought around organizational behavior that came to my mind. I have caught myself thinking how much harder it is to be in the front, to be the car leading the group of other cars. Now you must set the pace and you should choose the speed. One you are following someone, somehow you adjust to their speed up to the moment you think they are too fast or two slow. Another point is about the rear-view mirror: it is much more important to see what is happening behind once you know that there are others who are following. It comes back to the essential characteristic of a leader: there are no leaders without followers.

So --- here are the three points that I will take with me from Granada trip. I will use the opportunities to share this stories with others, and you are my first audience :)


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