How top companies breed stars

The world's best companies realize that no matter what business they're in, their real business is building leaders. Here's how the champs do it.

By Geoff Colvin, Fortune senior editor-at-large

September 20 2007: 10:02 AM EDT

Excerpts
Most companies maintain their office copiers better than they build the capabilities of their people, especially the ones who are supposed to be future leaders, and for decades they've gotten away with it.

"Organizations need talented people a lot more than talented people need organizations."

It seems young people understood the new nature of today's economy before a lot of CEOs did, and they insist on jobs that will keep making them better.

Companies are finding that the advantages of building a reputation for developing talent are greater than they may have thought.

"Companies that provide people with opportunities to learn and grow become talent magnets, drawing scarce talent in droves."

Lots of companies claim they're interested in developing leaders, but the University of Michigan's Noel Tichy, a top authority on the subject, says that checking their commitment is easy: "Just show me the CEO's calendar."

...nurturing future leaders earlier than other companies creates a competitive advantage that lasts for decades, as their talent pipelines become bigger, better, and more reliable.

About two-thirds of leadership development comes from job experience, about one-third from mentoring and coaching, and a smidgen from classroom training.

"you learn ten times more in a crisis than during normal times."

Many CEOs report new tension between the need to develop people by moving them through different jobs and the need to develop their expertise in certain domains by leaving them put.

One technique: short-term work assignments. Managers don't leave their jobs, but they take on an additional assignment outside their field of expertise or interest.

The companies on our list combine frequent, honest assessment with plenty of mentoring and support. So when people are told what skills they need to improve, they're also offered programs or coaching for doing it.

GE takes whole teams and puts them through Crotonville together, where they make real decisions about their business. Result: "There's no excuse for not doing it."

"The command-and-control model of leadership just won't work 99% of the time."

Encourage leaders to be active in their communities.

At General Mills it's an explicit part of many employees' development plans to serve on a nonprofit board.

Good as these companies are, not one of them is satisfied with the way it develops leaders.

Fast Company: Analysis of Paralysis - If your strategy doesn't help employees act, it's not a strategy - Making Ideas Stick

Fast Company: Analysis of Paralysis - If your strategy doesn't help employees act, it's not a strategy

Excerpts
"Keep it simple, stupid." That's the advice every executive has received on how to share strategy with employees. The subtext is often, "Keep it simple, because your people are stupid." But you don't need to embrace simplicity just so your people can comprehend your message. The point of simplicity is more fundamental: Simplicity allows people to act.

More options, even good ones, can freeze us, leading us to stick with the "default" plan. This clearly is not rational behavior, but it is human behavior.

As Barry Schwartz puts it in his book The Paradox of Choice, as we face more and more options, "we become overloaded…. Choice no longer liberates, but debilitates. It might even be said to tyrannize."

Book: Amazon - Made to Stick
Made to Stick book web site

The takeaway is that we spend a great deal of energy trying to spread the word when we would be better served to improve the longevity of the word for the people that it reaches.

Chip Heath’s research suggests that sticky ideas share six basic traits.

1. Simplicity. Messages are most memorable if they are short and deep. Glib sound bites are short, but they don’t last. Proverbs such as the golden rule are short but also deep enough to guide the behavior of people over generations.
2. Unexpectedness. Something that sounds like common sense won’t stick. Look for the parts of your message that are uncommon sense. Such messages generate interest and curiosity.
3. Concreteness. Abstract language and ideas don’t leave sensory impressions; concrete images do. Compare “get an American on the moon in this decade” with “seize leadership in the space race through targeted technology initiatives and enhanced team-based routines.”
4. Credibility. Will the audience buy the message? Can a case be made for the message or is it a confabulation of spin? Very often, a person trying to convey a message cites outside experts when the most credible source is the person listening to the message. Questions—“Have you experienced this?”—are often more credible than outside experts.
5. Emotions. Case studies that involve people also move them. “We are wired,” Heath writes, “to feel things for people, not abstractions."
6. Stories. We all tell stories every day. Why? “Research shows that mentally rehearsing a situation helps us perform better when we encounter that situation,” Heath writes. “Stories act as a kind of mental flight simulator, preparing us to respond more quickly and effectively.”

Judgment Call - Warren Bennis says leaders are measured by the judgments they make—and he identifies three key areas where good judgment is essential

Judgment Call
By Warren Bennis
Warren Bennis says leaders are measured by the judgments they make—and he identifies three key areas where good judgment is essential.


There are four areas of knowledge that are critical to making good versus bad decisions: self-knowledge, social-network knowledge, organizational knowledge, and stakeholder knowledge.


Warren Bennis has studied leadership as much as any person on this planet. The 82-year-old distinguished professor of business administration and founding chairman of the Leadership Institute at the University of Southern California has led organizations and been writing, teaching and consulting about leadership for more than a half century. (He is also a former CIO Insight columnist.)


Still, the author of the forthcoming book, Judgment: How Winning Leaders Make Great Calls (Portfolio, November 2007), written with University of Michigan management professor Noel Tichy, says that while scholars haven't ignored the topic of judgment, it hasn't been addressed often enough. Bennis says his latest book "is certainly not the last word on judgment. I can tell you that without any false modesty; I feel I'm just beginning to understand judgment myself."

Bennis notes that we make thousands of judgment calls throughout our lives, from the frivolous to the momentous. Making sound judgments can determine our success in life. But for leaders, he says, the impact of making right or wrong judgment calls is amplified, because their decisions have a direct bearing on the quality of life of so many individuals—as well as on the organizations they lead. CIOs have a special responsibility, he told CIO Insight executive editors Allan Alter and Eric Chabrow, not only because they must execute good judgment, but also because they provide other leaders with the information they need. An edited version of his remarks follows.

Social Network Analysis Helps Maximize Collective Smarts

Social Network Analysis Helps Maximize Collective Smarts


This particular exercise followed a yearlong study of social networks in Mars’s sprawling research and development division. Top executives there wanted to improve the company’s ability to innovate and were concerned that their scientists weren’t networking enough with outside colleagues. To find out who was working with whom and how scientists were getting new ideas, they decided to map the group’s professional contacts using a process called social network analysis (SNA). In an online survey, R&D managers were asked to name the 15 people they work most closely with and whom they go to for advice, as well as further details of their professional network.

he company has determined, for instance, which scientists were overburdened (too many people were going to them for help) and is working on eliminating the need to go to senior people to get approval for things.

Looking at the company org chart, it turns out, often doesn’t tell the real story about who holds influence, who gives the best advice and how employees are sharing information critical for success. This all takes on greater urgency as millions of baby boomers prepare to retire over the coming decade.

SNA can help companies identify key leaders and then set up mechanisms—such as "communities of practice" or other groups—so that those leaders can pass on their knowledge to colleagues.

Over the past several years, with help from Krebs and other SNA believers, the corporate world has been waking up to the uses for this once arcane social science. Some of the interest stems from disappointment with efforts to build knowledge management databases that were largely ignored by employees.

SNA can also make the lack of connections (or collaboration) painfully clear.

"People sometimes don’t believe that they are disconnected from the rest of the organization, but in our case, a picture spoke a thousand words," Gulas says.

At Mars, the SNA project uncovered a lack of good communication between the snack food division in New Jersey and the food division in Los Angeles. "We found very few bridges between the two groups, and that lack of communication was leading to duplication of efforts in some areas," says Caroline Ruzicka, who was then group research and development manager for Masterfoods USA, a division of Mars, and has since left the company.

By mapping the social networks in their organizations, companies can find out ahead of time who has necessary knowledge and create ways of transferring it to younger employees before it’s too late.

...networking has been built into the development and performance review process, and scientists have to set goals on expanding their networks.

Those who turn out to be highly connected are often high performers, and conversely, those with few connections often are not performing as well.

FORTUNE Magazine: What's that spell? TEAMWORK!

What's that spell? TEAMWORK!

Harmony. Cooperation. Synchronized effort. It's difficult, but it can be learned. What's the best way to do so? Watch the great teams very closely - and then join one of your own.

by Jerry Useem, FORTUNE Magazine

June 8, 2006: 8:46 AM EDT

Excerpts
...teamwork is a practice. Great teamwork is an outcome; you can only create the conditions for it to flourish.
We will go further and say: Teamwork is an individual skill.
You can't control other people's behavior, but you can control your own. Which means that there is an "I" in team after all.
...if kids are simply put into teams and told to solve a problem, the typical result is one kid dominating and others looking totally disengaged.
But if teachers take the time to establish norms - roles, goals, etc. - "not only will [the children] behave according to the new norms, but they will enforce rules on other group members." Perhaps to a fault. "Even very young students," Cohen wrote, "can be heard lecturing to other members of the group on how they ought to be behaving."
Would people cooperate without any incentives? The answer was - gasp! - yes, under the right conditions. Participants often cited "group welfare" as motivation.
Excerpts

(FORTUNE Magazine) - In 1972 a crack commando unit was sent to prison by a military court for a crime they didn't commit. These four men promptly escaped from a maximum-security stockade to the Los Angeles underground. Today, still wanted by the government, they survive as soldiers of fortune. If you have a problem, if no one else can help, and if you can find them, maybe you can hire the A-Team.

The A-Team went off the air in 1987- still wanted by the government -but television has never produced a better blueprint for team building. The key elements of its effectiveness: a cigar-chomping master of disguise, an ace pilot, a devilishly handsome con man, a mechanic with a mohawk, and an amazingly sweet van. Those particulars might not translate to all business settings. But clear definition of roles is a hallmark of effective collaboration. So is small team size - though four is slightly below the optimal number, 4.6.

And the presence of an outside threat - like imminent recapture by government forces - likewise correlates with high team cohesion. To wit: France and England, which bloodied each other for centuries before they noticed ... Germany. Another universal characteristic of teams is that they're, well, universal. If you work for a living, we're guessing you interact with other humans. (Lighthouse keepers, we'll see you next time.)

If you think this is mushy stuff, marginal to the daily battle of business, consider what is happening atSony (Research). CEO Howard Stringer and President Ryoji Chubachi are trying to restore the fighting spirit (and higher profits) at a company built on decentralized teams. Their theme: Sony United.

This issue also takes you deep inside a six-man team of Marines operating in Iraq; the team that built Motorola (Research)'s RAZR phone; the cutthroat yet symbiotic pack of cyclists in the Tour de France; and the world of an open-source software company. Each of these stories challenges a piece of conventional wisdom.

The fact is, most of what you've read about teamwork is bunk. So here's a place to start: Tear down those treacly motivational posters of rowers rowing and pipers piping. Gather every recorded instance of John Madden calling someone a "team player." Cram it all into a dumpster and light the thing on fire. Then settle in to really think about what it means to be a team.

We're certainly not against the concept of teamwork. But that's the point: All the happy-sounding twaddle obscures the actual practice of it. And teamwork is a practice. Great teamwork is an outcome; you can only create the conditions for it to flourish. Like getting rich or falling in love, you cannot simply will it to happen.

We will go further and say: Teamwork is an individual skill. That happens to be the title of a book. Christopher Avery writes, "Becoming skilled at doing more with others may be the single most important thing you can do" to increase your value--regardless of your level of authority.

As work is increasingly broken down into team-sized increments, Avery's argument goes, blaming a "bad team" for one's difficulties is, by definition, a personal failure, since the very notion of teamwork implies a shared responsibility. You can't control other people's behavior, but you can control your own. Which means that there is an "I" in team after all. (Especially in France, where they spell it equipe.)

Yet this is not the selfish "I" that got so much attention during the "me" decade; it's the affiliatory "I" that built America's churches and fought its wars. Neil Armstrong didn't get to the moon through rugged individualism; there is no such thing as a self-made astronaut. "Men work together," wrote Robert Frost, "whether they work together or apart."

Here's both the problem and the promise of cooperation. Humans aren't hard-wired to succeed or fail at it. We can go either way. In her study of groupwork in school classrooms, the late Stanford sociologist Elizabeth Cohen found that if kids are simply put into teams and told to solve a problem, the typical result is one kid dominating and others looking totally disengaged.

But if teachers take the time to establish norms - roles, goals, etc. - "not only will [the children] behave according to the new norms, but they will enforce rules on other group members." Perhaps to a fault. "Even very young students," Cohen wrote, "can be heard lecturing to other members of the group on how they ought to be behaving."

Economists have long assumed that success boils down to personal incentives. We'll cooperate if it's in our self-interest, and we won't if it's not. Then a team of researchers led by Linnda Caporael thought to ask: Would people cooperate without any incentives? The answer was - gasp! - yes, under the right conditions. Participants often cited "group welfare" as motivation.

To economists, shocking. To anyone who's been part of a successful team, not shocking at all. Life's richest experiences often happen in concert with others - your garage band, your wedding, tobogganing. The boss who assumes that workers' interests are purely mercenary will end up with a group of mercenaries.

No battery of team exercises can fix that situation - especially if they involve spanking your colleagues with yard signs. When a sales office of a home-security company, Alarm One, adopted that practice, a 53-year-old employee later sued for emotional distress. (A jury awarded her $1.2 million in April.)

Again, let the greats show the way. During a public appearance in 2000, an A-Team cast member was asked by a fan to name his favorite co-star. "Listen," Mr. T responded. "That's wrong for me to pick a favorite, because I'm a team player and we were a team. Remember, they say" - here it comes again - "there's no 'I' in team." No, but there is a "T." And pity the fool who forgets it.