Harvard Business Review - April 2015

2016-01-15

Learning notes on Harvard Business Review, April, 2015.

Don’t Let Authenticity Hold You Back

Authenticity has become the gold standard for leadership. But a view of it as a static, unwavering identity can limit you, says Ibarra. It may become an excuse for sticking with what’s comfortable and not taking on bigger challenges. Leaders must develop an “adaptively authentic” style by experimenting with many approaches and behaviors.

Authenticity means different things to different people: expressing how you really feel, being true to your values, being transparent, and so on. But we sometimes take it to mean “being as we’ve always been.” Any new and unfamiliar role calls for new and unfamiliar behavior, but anything outside our comfort zone feels inauthentic and contrived at first. We all learn by emulating our role models. It’s the only way to test new possibilities and eventually tailor them to arrive at a more authentic and impactful self.

A Second Chance to Make the Right Impression

someone meeting you for the first time—or reassessing you later—views you through various lenses: the trust lens, to decide if you’re friend or foe; the power lens, to assess your usefulness; and the ego lens, to confirm a sense of superiority. You can use those lenses to change impressions of you.

Measuring the Return on Character # LEADERSHIP#

Do highly principled leaders and their organizations perform especially well? They do, according to a new study by KRW International, a Minneapolis-based leadership consultancy. The researchers found that CEOs whose employees gave them high marks for character had an average return on assets of 9.35% over a two-year period. That’s nearly five times as much as what those with low character ratings had; their ROA averaged only 1.93%.

KRW International conducted a survey on four moral principles — integrity, responsibility, forgiveness, and compassion - of CEOs. The survey result is shown as follow.

Note: “virtuoso CEOs” in grey and “self-focused CEOs” in red.

When asked to rate themselves on the four moral principles, the self-focused CEOs gave themselves much higher marks than their employees did. (The CEOs who got high ratings from employees actually gave themselves slightly lower scores—a sign of their humility and further evidence of strong character.)

Character isn’t just something you’re born with. You can cultivate it and continue to hone it as you lead, act, and decide. The people who work for you will benefit from the tone you set.

How Consumers Understand (and Misunderstand) Pricing Cues

High volume=low cost. When consumers believe that a retailer is focused on volume, they infer that the store can secure deep discounts from suppliers and sell at low margins - a combination that presumable results in low prices.

Frills=high cost. Consumers believe, often on a subconscious level, that they’ll have to pay for anything extra.

Unconventional products=high cost. Customers associate unadorned functionality with low prices. Quirky, specialized, or highly designed items make people assume that even the store’s mainstream goods have steep prices.

Reusable Bags Make People Buy Organic and Junk

People who brought their own bags were more likely to buy organic goods—but were also more likely to load up on high-fat, high-calorie junk.
So this is the classic indulgence: You do good and— You give yourself a cookie. In this case literally. In consumer psychology the word “licensing” is the key. If I behave well in one situation, I give myself license to misbehave in another, unrelated situation. Similar research has also been done on health decisions. I get a Diet Coke; I treat myself to a hamburger. In this case bringing a bag makes you think you’re environmentally friendly, so you get some ice cream. You feel you’ve earned it.

Reinventing Performance Management

Disadvantages of traditional performance management

Time consuming

We tallied the number of hours the organization was spending on performance management—and found that completing the forms, holding the meetings, and creating the ratings consumed close to 2 million hours a year. As we studied how those hours were spent, we realized that many of them were eaten up by leaders’ discussions behind closed doors about the outcomes of the process.
Idiosyncratic rater effect
- Objective as I may try to be in evaluating you on, say, strategic thinking, it turns out that how much strategic thinking I do, or how valuable I think strategic thinking is, or how tough a rater I am significantly affects my assessment of your strategic thinking.
- Accoring to the study conducted by Michael Mount, Steven Scullen, and Maynard Goff and published in the Journal of Applied Psychology in 2000, 62% of the variance in the ratings could be accounted for by individual raters’ peculiarities of perception. Actual performance accounted for only 21% of the variance.
- Ratings reveal more about the rater than they do about the ratee.
It can not fully help people make full use of their strengths
- Almost all the variation between high- and lower-performing teams was explained by a very small group of items. The most powerful one proved to be “At work, I have the opportunity to do what I do best every day.”
- Three items correlated best with high performance for a team: “My coworkers are committed to doing quality work,” “The mission of our company inspires me,” and “I have the chance to use my strengths every day.” Of these, the third was the most powerful across the organization.

Radical Redesign

Recongnize performance – through compensation.
See performance clearly – performance snapshot.
- People may rate other people’s skills inconsistently, but they are highly consistent when rating their own feelings and intentions. To see performance at the individual level, then, we will ask team leaders not about the skills of each team member but about their own future actions with respect to that person.
- We are asking our team leaders what they would do with each team member rather than what they think of that individual.
- Shifting our 2-million-hour annual investment from talking about the ratings to talking about our people—from ascertaining the facts of performance to considering what we should do in response to those facts.
Fuel performance
- Research into the practices of the best team leaders reveals that they conduct regular check-ins with each team member about near-term work. These brief conversations allow leaders to set expectations for the upcoming week, review priorities, comment on recent work, and provide course correction, coaching, or important new information. The conversations provide clarity regarding what is expected of each team member and why, what great work looks like, and how each can do his or her best work in the upcoming days—in other words, exactly the trinity of purpose, expectations, and strengths that characterizes our best teams.
- Our design calls for every team leader to check in with each team member once a week. For us, these check-ins are not in addition to the work of a team leader; they are the work of a team leader.
- If you want people to talk about how to do their best work in the near future, they need to talk often. And so far we have found in our testing a direct and measurable correlation between the frequency of these conversations and the engagement of team members. Very frequent check-ins (we might say radically frequent check-ins) are a team leader’s killer app.