Yves Morieux is a Senior Partner and Managing Director at The Boston Consulting Group, a BCG fellow and director of the BCG Institute for Organisation.Yves' Six Simple Rules of Smart Simplicity, has helped CEOs with their most critical challenges, for instance, moving their companies from quasi bankruptcy to industry leadership.He will be a keynote speaker at the IMI National Management Conference on 8 October 2015.
1. What is the chief thing that managers/leaders get wrong about what effective leadership means today, in your experience?
Managers often don't understand what their teams really do. They understand the structures, the processes, the systems. But this is not what people do – it is what people are supposed to do. A company's performance or a department's performance is what it is because people do what they do, because of their actions, decisions and interactions – their "behaviours". Because we don't understand what people do, we create solutions – new structures, processes, systems, scorecards, incentives, training, and communication – that don't address the root causes.
We don't solve the problem, we simply add more internal complicatedness. And the more complicatedness we create, the less we understand what is really happening, the thicker the smoke screen, and then the more rules we add. This is the vicious circle of modern management. This is why the first rule of what I call Smart Simplicity is "understand what people really do at work."
2. Do leadership principles work best when understood as a top-down process, or is this understanding of leadership out of touch with the modern workplace?
From collaboration to performance to employee engagement, everything we know about work is changing – but our businesses are seemingly slow to respond. People are more attuned to sharing posts, writing blogs, and providing instant feedback through ‘likes’ and ‘favourites’ than they are to completing surveys, so why does our approach to employee engagement still centre on a set of fixed statements and a rating scale?
In their personal lives people collaborate naturally with those around them and have an amazing propensity to share even when there is no immediate benefit to them, hence the success of crowdsourcing sites like Wikipedia. So, why do we spend so much time and energy in organisations on encouraging people to practice these seemingly natural behaviours at work?
The challenge for businesses is to disrupt every process and practice in the organisation by asking: Why does it exist? What are we trying to achieve? If we were to start the organisation from scratch, would we choose to create this? And perhaps most tellingly of all, would this practice exist if we trusted our employees?
3. A core feature of your approach to leadership and better workplace productivity is the concept of ‘Smart Simplicity’. How does this play out in a world where the data available to companies now – be it through consumer feedback, predictive modelling, data analytics etc – has surged? Does the effective use of all of this data necessitate more complexity, rather than simplicity?
The environment is more complex – the problems to resolve in order to attract and retain customers, in order to create value and build competitive advantage – are more demanding than in the past. This is a fact of life. Based on our analysis, complexity has been multiplied by 6 over the last 60 years.
The real problem is not business complexity. The real problem is internal complicatedness – the solutions companies typically use to try to respond to this complexity: a proliferation of cumbersome structures, interfaces, coordination bodies and committees, procedures, rules, metrics, key performance indicators and scorecards. Based on our analysis this complicatedness has been multiplied by 35! This complicatedness creates obstacles to productivity and innovation.
People spend their time writing reports, in meetings. There is more and more work on work, and less and less work! A lot of data, a lot of information is always good. The difficulty – and the value-added – is sense-making, to derive meaning and knowledge from the data, so that companies can interpret and act on the data. But complicatedness makes it increasingly difficult for companies to make sense of the data. There is at the same time a data indigestion and a knowledge deprivation.
4. When it comes to Irish businesses, how do their workplace dynamics compare with other countries and what would be your principal advice to them on what to change?
Irish businesses face the same problems as other mature economies. They need to manage the new business complexity without getting complicated. Smart Simplicity is not about becoming simplistic, we cannot ignore the new complexity of business. This is why I refer to "Smart" simplicity. The six rules of Smart Simplicity concern Irish businesses because Irish businesses are also confronted to a greater complexity.
5. Should business leaders focus more on improving employee productivity per se, or should this be balanced with also ensuring that staff are happy at what they do and not afraid to be creative? How does one strike an effective balance?
We must not strike a balance here! We must break the compromise between productivity and happiness or creativity. We must not improve one at the expense of the other. In fact organizational complicatedness hinders productivity while demotivating people and making them suffer at work. They lose direction, purpose and meaning in the labyrinth. They have to work longer and longer, harder and harder, but on less and less value-adding activities.
This is why Smart Simplicity and removing complicatedness simultaneously increases performance and satisfaction at work: because you remove the root-cause common obstacles that hinder both.
6. What do you think are the key organisational challenges that face a country like Ireland over the next few years, for both business managers/leaders and their staff?
Organizations are going through a deep revolution in their ways of working. We are going through a new economic revolution, and every economic revolution entails and organizational revolution. The organizational solutions on which we have built profitable growth over the last 30 years are obsolete. Irish managers and employees will have to invent new ways of working.
Smart Simplicity provides guidelines for this, but what mainly matters is boldness and courage in breaking with conventional wisdom. Irish people are certainly well placed in this respect!
Yves Morieux is a keynote speaker at the IMI National Management Conference taking place on Thursday 8 October. Apologies but this event has now reached maximum capacity.
[post_title] => "Understand what people do at work" Six Word Wisdom from Yves Morieux
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[post_content] => [caption id="attachment_22612" align="aligncenter" width="600"] Jack Welch was CEO of GE for 20 years. In a changing world, is he still the model for leadership?[/caption]
When discussing the challenges facing business leaders it seems almost de rigeur nowadays to talk about the level of change organisations are facing.
The challenge to equip leaders to build the future in these uncertain times is certainly daunting, with seismic geopolitical shifts (in this context the Trump administration seems to be the gift that keeps on giving), disruptive technological change (how many of us even fully understand the implications of bitcoin, blockchain and whatever new technology will be unleashed on us next) and even severe climate and weather events.
The very ubiquitous nature of these challenges may however inure us to their real potential as both a threat and an opportunity to affect a true paradigm shift in how we view leadership, a classic case of an issue being undervalued through overuse.
.The Concept of Leadership
From the perspective of the 21st century the development of our concept of leadership is a little clearer than it may have been in the past. From this remove we can see how the largely male, heroic models of leadership have greatly influenced the literature and teaching in this field.
The business leaders who are most often cited, Jack Welch, Steve Jobs etc. are broadly from a similar mould and the models of leadership, with the exception of Servant Leadership (as a servant leader you put the needs of others, particularly team members, before you even consider your own, but how many executives really model themselves on this type of leadership?) extol an assertive, confident, out-going and mainly extroverted style.
In fact, the Myers Briggs type most associated with leadership is the ENTJ (extraversion, intuition, thinking, judgment), which is described as the ‘general’, again exposing the military underpinnings of the leadership canon. We can clearly see this bias in the continuing popularity of books like Dale Carnegie’s “How to win friends and influence people”, the pseudoscience of NLP and programmes that teach executives how to create the right ‘impression’.
Given the genesis of the leadership concept it is understandable that people might misconstrue the notion of leadership presence as the ability to impose oneself (and influence people), but there is real hope that we are about to experience a genuine shift in the paradigm.
[caption id="attachment_22617" align="aligncenter" width="600"] Richard Boyatzis studied how leaders influence those around them and how that effected their lives and careers[/caption]
Recent research conducted by Richard Boyatzis and colleagues from Case Western Reserve University examined the relationship between the extent to which people adopted an ‘influencing’ leadership style and their later satisfaction with both their careers and their life in general. Interestingly they found a very strong negative correlation between these factors, i.e. the more people adopted an influence style the less satisfied they were with their careers and lives.
Boyatzis and colleagues did not have an objective measure of career success, so one could still argue that the ‘influencers’ did better in their careers, but Boyatzis’ research does tell us that irrespective on how well an outsider might judge your career progress, the ‘influencers’ are less happy about their situation. The researchers concluded that those who adopt an influencing style are pushing on their environment and trying to get more from others, e.g. they tend to show a high need to control social situations.
The crux of the problem, especially in the context of a VUCA world, is that pushing on or trying to control an environment that is in a constant state of flux, verging on chaos is unlikely to be very effective and will certainly lead to people being highly dissatisfied and unhappy in their work and indeed their lives.
Now would be the perfect time for the leadership movement to learn the lessons of evolutionary psychology that success in a changing environment falls to the most adaptable, those who can outlearn their competition.
The Adaptable Generation
This will require a cadre of new leaders who are less ego-identified with success and winning, who don’t see problems as opportunities to impose themselves and demonstrate mastery of the environment.
Rather we will see the emergence of leaders who can go with the flow, adapt to new realities quickly, work through and with others as either leader or follower and pivot gracefully as cherished paradigms fall away and hard-earned experience proves ineffective as a guide to new problems.
There is no doubt that the idea of women in leadership is in the current zeitgeist and may or may not create a fundamental shift in how we see leadership in the future. I am however hopeful, that as the new model emerges we will see less emphasis on the old machismo of the ability to impose oneself on others and on the environment and more emphasis on the willingness to adapt, change and ‘flow’ with emerging realities.
Bruce Lee used to tell his students to ‘be like water’, perhaps that is not a bad metaphor for what leaders will need to become.
Dr Colm Foster is Director of Executive Education at the Irish Management Institute.He has acted as a leadership development consultant to organisations in the US, Asia and Ireland, particularly specialising in Emotional Intelligence.
The next IMI Diploma in Leadership starts on 2nd May, 2018.
[post_title] => 21st Century Leadership: The Shifting River
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Dr. Jonathan Westrup
28th Mar 2017
Dr. Jonathan Westrup is the Programme Director of the IMI Diploma in Strategy and Innovation and of the IMI Diploma in Regulatory Management.
Business Model Innovation
"Understand what people do at work" Six Word Wisdom from Yves Morieux
21st Century Leadership: The Shifting River
Is your current business model fit for purpose?
Warren Buffet is a true believer in investing in businesses that have sufficient scale and brand that provide a sustainable barrier to competition which, in turn, allows them to generate sustained profitability.
How deep is your moat might sound like a rip-off of a Bee Gees disco classic. It is instead a favourite question of Warren Buffett and his Berkshire Hathaway conglomerate when they seek out acquisition targets. Buffet is a true believer in investing in businesses that have sufficient scale and brand that provide a sustainable barrier to competition which, in turn, allows them to generate sustained profitability.
But it is clear that for many businesses, their moats are becoming increasingly shallow. The reasons for this are no surprise as we see how both globalization and increasingly digitalisation lead to a much greater risk of the commoditization of goods and services where differentiation is challenging and pricing power is therefore eroded.
So what is the appropriate response? A key question to ask is to be very sure that you know what business you should be in. This might sound like the statement of the obvious, but a great example in an Irish context of the business that asked such a question was UDG, formally known as United Drug. This was a company that over time had built up a very profitable pharmaceutical distribution business in Ireland and the UK. However, about a decade ago the management team realised that their place in the “value chain” was increasingly vulnerable as the traditional chemist buyers merged and consolidated thereby increasing their “buyer power”. Their first strategic response was to evaluate where they could use their insight and knowledge to capture value in the rapidly evolving pharmaceutical industry. They identified specific segments in the areas of sales, marketing and packaging where through targeted acquisitions they could build up the capabilities necessary to achieve sufficient scale. Their success meant that last year they were in a position to sell the original core distribution business to the global player McKesson who have the economies of scale necessary to capture strategic value.
So today UDG are in a different business than the one they competed in a decade ago. They used their strategic insight and knowledge of the pharmaceutical industry to pivot away from a business where they could see that the moat could spring leaks and to build up a strategic position in sectors of the industry where they could see that pharmaceutical companies would be keen to partner with a business with particular expertise and the scale to compete globally.
Even for businesses that have very robust business models, the discipline of systematically assessing all aspects of how the external environment is changing is critical to both seeking out growth opportunities and avoiding nasty surprises. In this regard, a focused and externally validated analysis of the potential “game changers” using the PESTEL framework is key to a successful outcome. This works best, in my experience, when the analysis is very clearly future focused. An equally systematic analysis of the competitive environment is a further vital exercise that assesses the risks of new entrants and the strengths and weaknesses of competitors’ business models. This external analysis should be on every senior management team and board’s strategy agenda on a regular basis and should always involve outside confirmation of key assumptions to avoid classic confirmation biases.
So a well-structured and robust external analysis of a business will help to identify the likely threats to the moat and to provide guidance as to the question of whether our current business model is fit for purpose. The next stage in the strategy is deciding what capabilities are required in order to make sure the business model will continue to thrive. But if instead we choose to stick our collective heads in the sand, we run the risk of the tide sweeping away the entire enterprise, moat and all.