Category Archives: Strategy
For innovation firepower turn weakness into strength
I’m not a fan of the idea of only working on your strengths and ignoring your weaknesses. It’s too one-dimensional and leads to ‘more of the same’. This idea of only working on your strengths surely leads to continuous improvement no doubt but not dramatic change. Only by working on your strengths ‘continuously’ and turning your weaknesses into strengths can you have superior capability.
On Saturday night I was watching UFC 124 and watched Georges St. Pierre dominate his opponent by basically doing nothing. His opponent, Koscheck, had to much respect for him that he decided to be tentative and never showed any intent in fighting. And thus made all of us watch a boring fight.
Why didn’t a guy that was aggressive pre-fight, look like a punching bag at fight time?
Because Georges St. Pierre is a superior all-around-fighter, and made Koscheck’s game plan irrelevant. GPS is versatile and can adapt to any fighting style on the fly. This is what makes him so good. He has no obvious weaknesses. The guy is a strategist.
What GSP does, is work on his weaknesses and turns them into strengths. This has lead to a dramatic change in his fight style and more importantly how his opponents perceive him. His opponents come prepared with a strategy to defeat him, but GSP adapts to it. This leaves his opponents in limbo as their game plan is now made irrelevant by a fighter who shows no weakness.
What does this have to do with innovation?
Working on improving/eliminating your weaknesses leads to dramatic change. It’s like renewal. A few weeks ago Ralph Ohr wrote a great post on how there are basically two ways that organizations compete in a market:
- meet existing needs and expectations that customers are aware of,
- anticipate needs that customers are not (yet) aware of (perception).
The first is short term focused and relies on an organization exploiting it’s known strengths. The second, relies on going beyond the known. Sometimes even relinquishing some of it’s strengths and turning their weaknesses into strengths. The majority of organizations focus on meeting existing needs (known by analysis) but not on anticipating needs. This logic is pervasive. It’s what you’re taught in school to do. Anticipating needs (imagination+insight), which was taken away in school, is done by very few.
As Ralph noted in his post: Successful companies of the future will most likely be able to combine both capabilities.
Basically, most organizations are good at exploiting existing capabilities but not good at creating new ones. Among other things, it’s this lack of imagination that is the weakness of most organizations.
Do you see the connection?
Last week I wrote that in the world of innovation there should be a balance between innovation and continuous improvement. You have ‘projects’ that are intended to improve your product or service, but also have ‘projects’ that are beyond your known domain that are meant to either stretch your existing capabilities or acquire new ones. This is the way to go! By only improving your strengths you’ve already setup your tombstone.
To be built to last is to be built to change, and that only happens by continuously improving what you’re good at and relentlessly working on turning your weaknesses into strengths. Your strengths might save you in the short term, but your next source of advantage most likely will come from turning your weaknesses into strengths. And thus, will keep you relevant in the long term.
Thoughts?
The Opposition Strategy
One great way to stand out and differentiate is to do the opposite of what everyone else is doing. An opposition strategy is usually the result of challenging long held assumptions of how things are done, this is the domain of us ‘crazies’ who question authority.
I spotted a restaurant on Springwise that is quite literally the ‘anti-restaurant’. Street Dinner’s concept is based on using the element of surprise for location and everything else that goes into a dining experience. Instead of having dinner at a determined location, knowing what the menu is and having it served the same way at a traditional restaurant; it does the opposite:
Participants in Ferrara’s September Street Dinner began by purchasing for EUR 60 per person a package for two that included separate tickets for aperitifs, a table and two chairs, and two dinner menu choices; also included were two Street Dinner sweatshirts, instructions and a map of the city. Guests also provided their mobile phone number up front. Then, on the designated evening, an SMS arrived revealing first the location where aperitifs were to be served. Next, an hour before dinner, a second text message told participants where to pick up their table, chairs and chosen meals. Finally, after that a third text message revealed at last the location of the dinner. An option including overnight stay in a 3- or 4-star hotel was also offered beginning at EUR 115 per person. All participants were entered in a drawing for a free trip to Mauritius as well. Operated by travel agency Link Tours with sponsorship from a variety of other local organizations, the Street Dinner is planned to occur again at some as-yet-unspecified date in 2011.
This is a favorable strategy when you identify that herd behavior is prominent and every competitor is adopting very passive behavior to competition. Basically when you can’t tell what makes one competitor different from another. My argument is not to adopt the opposition strategy just for fun or because it seems like an easy way to stand out, but to first identify in what situation it’s valuable.
Here are a few situations when it’s a valuable approach:
- When the system is stuck. When an entire industry is stuck in an old perspective, everyone holds the same beliefs of how things should be done. Time to shake it up.
- When you want to piss off competitors. When others are worried about making their next sales goal, you’re actually focusing on making customers happy ala Zappos. That forces competitors to have to adopt a behavior they don’t really want to. Kings to you.
- When you don’t want to appear as a threat. Madness creates opportunity. By acting deliberately crazy no one will want to compete with you on your terms.
- When you want to be known for something. As Youngme Moon says: Differentiation is a way of thinking. It’s a mindset. It’s a commitment. A commitment to be different, not in a superficial, I’m-going-to-offer-a-couple-of-features-my-competitor-doesn’t-offer kind of way, but in a way that is fundamental and near impossible to replicate. Bottom line: Have a point of view.
All above points can be the direct result of doing the opposite as everyone else. It’s also a risky approach because most times it requires new capabilities and provokes competitors; thus it often results in changing the game!
What do you think, in what other situations does it apply?
Radical Management. It isn’t just W.L. Gore
It isn’t just W.L. Gore who has a very unique management structure. This morning I received Adaptive Path’s Newsletter, and in it is an article explaining their own management structure or Advocate Program. It’s very interesting and I couldn’t help relate it to W.L. Gore’s structure. I’ve pasted the article below but for context first read Peter Merholz brief summary and then come back here.
P.S. If you want the article leave me your email in the comments or DM me on Twitter and I’ll forward it to you.
In the beginning
The Advocacy Program started in 2006 when Adaptive Path was about 16 people big. As we grew, an ad-hoc management structure began to emerge, and it started to look and feel like a traditional reporting structure. As an entrepreneurial and egalitarian culture, that didn’t seem to be a good fit for us. Janice Fraser in her role as CEO introduced a different approach: a 1:1 support structure we called the Advocate Program.
The Advocate Program is a communication system designed to support and empower all employees. The role of the Advocate is to support, guide, push and to advocate for your success. Every person at Adaptive Path has an Advocate, and each Advocate/Advocatee relationship is unique to its members; this is part of what makes the program so special.
Adaptive Path was founded on principles of personal responsibility, creativity, curiosity, mutual respect, self-determination, a healthy tolerance for ambiguity and a collective commitment to design that delivers great experiences that improve people’s lives. Having this foundation of shared values was an important starting point for a program that relies so heavily on interdependency.
Contributing factors are in play, of course. The Advocate Program isn’t the only organizing structure we have. The nature of the work we do (consulting, our public events, R&D) is very project-centric, and project teams define their own working practices. We have different lines of business that organize tasks and responsibilities for their work. We have smaller groups that focus on fostering ideas and thinking about UX approaches and methods. We also have multiple studios and the Studio Directors coordinate work in each location. We have a running-the-business group that herds all the cats. But for overall people-support, the Advocate Program is the glue.
Overall, the structure of Adaptive Path looks less like this:
And more like this:
The program in a nutshell
The basics:
- Everyone has an Advocate.
- Advocatees ask someone (anyone) to be their Advocate, and the partnership is confirmed by mutual agreement.
- People can change their Advocacy relationship at any time, for any reason. This is true for both the Advocatee and the Advocate.
- No closed loops; you can’t be the Advocate for someone who is Advocating for you.
- Advocates generally have no more than three Advocatees.
What do Advocates do?
- Advocates do lots of the things that in a traditional business would be done by a manager:
- Help set goals, give feedback, find inspiration and move you beyond your comfort zone.
- Help you cope and deal with issues and act as an escalation point if needed.
- Coordinate feedback, reviews and goal-setting with the people to whom you’re accountable.
From a tactical standpoint:
- Advocates and Advocatees meet at least once a month for a check-in, but many pairs meet more often.
- Advocatees work with their Advocate to set direction/goals for the year.
- Advocates gather ongoing feedback for their Advocatees.
- A listing of Advocatee/Advocate relationships is available on an internal wiki, so that everyone knows who’s with whom, and who they can go to with feedback or issues.
A good Advocate…
Like a mentor, a good Advocate is someone absolutely credible whose integrity transcends the message, be it positive or negative. They tell you things that may be hard to hear, but in a way that leaves you feeling you have been heard. An Advocate interacts with you in a way that makes you want to become better—better designer, worker, person—and makes you feel secure enough to take risks.
A good Advocate gives you confidence to rise above your own doubts and fears and supports your attempts to set stretch goals for yourself. They also identify opportunities and highlight challenges you might not have seen on your own. And on a more day-to-day level, they can help you get things done. In a previous newsletter, my colleague Pam wrote about doing some goal mapping with her Advocatee while her own Advocate helped document the process so Pam could share it in the newsletter thus fulfilling one of her own goals to write more. This is just one example of the kinds of advocacy activities happening at any given moment within Adaptive Path.
How do people choose their Advocates?
Reasons for choosing an Advocate are personal and unique to each staff member. Some common reasons that people have mentioned include:
“I chose my Advocate because he is doing the kind of work that I want to do.”
“I chose my Advocate because I trust her to tell me the honest truth…even if it’s hard to hear.”
“I chose my Advocate because she is willing to go to bat for me…and sometimes I need a kick in the butt.”
“I chose my Advocate because he’s been around and has Adaptive Path company history.”
It’s recommended that you choose an Advocate you think you can learn from, someone who has succeeded in an area you, too, want to be successful. You can choose an Advocate who does entirely different work than you, who can expose you to something new or to a different way of thinking about or approaching your work. Some of our non-practitioners, for example, find it really helpful to team up with designers to bring a little of that old sticky-note, whiteboard ‘magic’ into the way they tackle things.
Many people at Adaptive Path have held management roles in the past: they’ve led others, run teams, departments, businesses, and have coached or mentored people both formally and informally. That said, the most important qualities for an Advocate to possess are honesty, thoughtfulness and a strong desire to help their Advocatees be as successful as possible—in whatever form success takes for each person.
How has it evolved?
As we’ve grown, we’ve made some changes to help the program adapt and scale.
In 2009, we formed the Advocate Council to support the Advocate program. The Council has four members: two roles specifically for people-related functions which are Director of HR and the First Advocate. The First Advocate helps all our new hires get into the groove and find their way as an Adaptive Path newbie. The other members are selected annually by the whole company. The goal is for the selection process to be as lightweight as possible: a call goes out to fill the open seats, and a short web survey is provided for staff to select the names of people they think would be a good fit for the role. The new members are welcomed in at a company meeting.
Picking an Advocate is a personal choice, and it means you have to know who people are so that you can find a good match. With 50+ employees, that’s a lot to ask for new folks, so now there is a First Advocate who serves the role for the first three months. During this time the First Advocate encourages you to meet new people, go out to coffee or work on a project with specific co-workers, and overall helps you get socialized into the Adaptive Path culture. After three months, you’re ready to talk to potential Advocates and make an informed choice.
Once a year the Advocate Council hosts Advocacy Open Enrollment, which (like a health plan) is a designated time to refresh and renew Advocate relationships. This may mean finding a new Advocate, or it may mean renewing a current relationship—whatever is best for each employee.
There aren’t a bunch of forms to fill out or a lot of red tape. The process is designed so that nothing gets in the way of open and personal conversations between people. These conversations are key to making a good match. And a $5 coffee card given to each employee helps grease the skids for the conversations. Additionally, each person who wants to be an Advocate creates an Advocacy Profile outlining their approach to Advocacy which we post on our internal wiki to be browsed by those looking to make an Advocate/Advocatee match.
The Advocate Trophy (a bronzed unicorn—long story) is awarded quarterly to an Advocate (nominated by their Advocatee) who has gone above and beyond in supporting their Advocatee. This is a way to see what kinds of support are helpful and appreciated, and is a way to acknowledge great support models and techniques.
But wait. Isn’t this really complicated and time-consuming?
Yep. One thing we know for sure it that it’s more complicated than a traditional command and control structure. But the purpose is less about maximizing organizational efficiencies and more about supporting overall individual and collective effectiveness and creating space for people to do their best work no matter what their role is within the organization. The process relies on a level of self-awareness and self-knowledge that is important in fostering true collaboration and creative progress. The culture at Adaptive Path demands that people are intentional about charting their own course and having the internal motivation to realize their best work. This is hard, but the rewards and personal fulfillment that result make it worth the investment.
Although the specifics have evolved, the underlying principles that were the inspiration for the program are still fundamental:
- Mutual respect and trust in each other
- An honest desire to see every individual succeed
- Manage the work, not the people
- Support personal growth and inspire people to move out of their comfort zone
- Celebrate trying new things
- Honest, frank conversations
- Be a good company citizen
It’s a challenge to scale a flat(ish) organization, and the models for coordination and collective leadership are not as well known as the business-as-hierarchy approach. But Adaptive Path is not in the business of running trains or manufacturing hard goods. We’re a design company where the challenges are wicked, the focus is on people and the speed of change is rapid. The 1:1 support model means that we rely on each other to do our best work. The Advocate Program was designed to enable this to happen. To quote Janice Fraser, “The best work happens when we are all smarter for having worked together.”
What’s next?
As Adaptive Path continues to grow, we’ll have to revisit how the Advocate Program can scale, especially across three studios. Perhaps in the future it will transform into something very different. But the underlying principles of investing in each other and supporting the team are fundamental to being the kind of company we want to be.
Other companies that we watch and learn from also have the strong commitment to employee support and people-centric programs. Pixar, Netflix, Southwest Airlines, Zappos…all are known for their strong internal cultures and their focus on making an environment where individuals can participate fully and realize their full potential. These companies are also known for incredible customer loyalty and strong financial performance.
That’s a model we’re happy to work with.
Radical is just a matter of perception
What’s more radical, not getting married but live together or getting married after knowing someone for 1 month?
What’s more radical, setting up a gym inside your company and paying employees to use it or paying employee’s gym subscriptions outside the company?
What’s more radical, having two kids or ten in the modern day?
What’s more radical, having a customer wait until you decide to serve them or serve them when they want to?
What’s more radical, treating employees like cogs in a system and telling them what to do or trusting their judgment to make the right decision?
What’s more radical, designing products for people without asking them what they want (Apple) or doing what the customers asks (everybody else)?
You’re probably thinking these questions seem stupid but bear with me. Steve Denning recently pointed out that radical management in not really radical but common sense. It’s perceived as radical because we’ve been following the same rule book for so much time that the opposite seems well, radical.
For things to change, someone somewhere has to start acting differently. In five years what seems radical today will be normal. The system will get stuck again and somebody somewhere will do the opposite and then he’ll seem radical. And five years after that the same story will unfold. It’s a cycle.
Want to get radical with yourself? If you want to try something radical today, take a different route to work. Say hi and smile to everyone you see in the street even though you don’t know them. Shake someone’s hand like you really mean it and look them in the eyes with purpose. Be a true friend. Treat your customers with respect, like human beings.
I could go on with examples but I bet you get the message: What seems radical to someone is common sense to someone else.
Thoughts?
Why culture matters
Last week I was dinning at an Italian restaurant with my family. Our waiter was very courteous and by pure observation I could tell he stood out from the rest of the waiters in that restaurant. Two days later I dined at a ‘similar’ Italian restaurant with a few friends and to my surprise got served by the same waiter that served me days earlier at the other restaurant. What gives?
My initial thought was that these restaurants were owned by the same people, but that didn’t make sense since they pretty much have the same menu but their service is different. My second thought was that this waiter had two jobs which was the case.
But that’s not the point. Another observation I made was that this waiter was a better fit on this restaurant than the other one. You could tell there was purpose behind everything they did unlike the other restaurant. This is when it hit me: That’s why he stood out at the other restaurant.
Though I hate it that people have to work two jobs and have to use this particular waiter’s situation as an example, it got me thinking about an organizations culture.
Strategy drives culture
A strategy is at it’s core a guide to behavior. A good strategy drives actions that differentiate the company and produce financial success. And culture is a direct result of what your organizations strategy is including how and why you hire people.
The dominant logic is to see people as interchangeable parts in a system. You hire because you need help and make that decision based on credentials, not because you’re picky and have ‘an idea’ of what type of person ‘fits’ your organization.
This is flawed logic.
Imagine that Microsoft and Google exchanged employees. What would happen? Would Microsoft employees fit Google’s model and vice versa? Absolutely not!
Even though both of them are technology companies, they’re different in their approach in pretty much everything they do.
Different strategies and therefore different cultures. And that is key because their strategy dictates their behavior.
An even more unconventional example is Zappos, an online shoe retailer that knows why culture matters better than anyone (IMO). They hire for weirdness. They’ll even give you money to quit after they’ve hired you, which works as a ‘culture filter’ to weed out people who won’t fit in the long run. And lastly, they have a ‘culture book’ that gets updated every year by everyone in the company. Their goal is to deliver happiness. Enough said!
Closing thoughts…
I’ve argued before that most businesses look the same and operate the same way, the only difference being the name and colors on their logo. Though we tend to put a lot of emphasis on differentiation through product features and service models, we never mention ‘culture’ as the main differentiator. Yet it is people who ultimately execute strategy and the more engaged they are and feel part of something bigger than profits, the bigger the differentiator culture becomes.
Your people are the most important differentiator. As you can see from the examples above, culture matters.
Thoughts? Do you think people are the most important differentiator?
Related articles
You should never have to worry about…
Not having to worry about ‘x’ sounds too good to be true. Yet what if your value proposition was really focused on doing exactly that for customers or clients?
There aren’t a lot of companies ‘doing’ it so I was surprised to see what Box.net founder Aaron Levie said about his company’s intent:
“We’re moving toward a future where storage isn’t an issue,” Levie said. “You should never have to worry about how much storage you use.”
Take this example and apply it to something else. What if you never had to worry about having bad customer service? Ever! Wouldn’t that proposition really intrigue you? Of course it does.
Radicalize your strategy
Now apply it to your own offering. Think about an extreme version of your offering and stretch it to the point you may go bankrupt because you’ll be so focused on ‘eliminating worries’ that your customers will thank you for it!
Next, scale it back a little to the point where it generates interest and you can come up with ways to make it work.
Radical doesn’t mean risky, it means impact!
How to change people’s behavior by tweaking the environment
The interesting discussion we had about innovation being a matter of age brought up a lot of insights, one in particular was that to breed innovation an environment is more important than the age of the innovator. How this works is a little complicated to understand but let me explain how a cognitive bias impedes us from seeing change coming from our environment and then use some examples of how tweaking the environment makes change simple.
What looks like a person problem is often a situation problem.
We are frequently blind to the power of situations. In their book Switch: How to change things when change is hard, the Heath Brother’s argue that when it comes to changing our own behavior, environmental tweaks beat self control every time. In it they mention a famous article by Stanford psychologist Lee Ross in which he surveyed dozens of studies in psychology and noted that people have a systematic tendency to ignore situational forces that shape other people’s behavior. He called this deep rooted tendency the "Fundamental Attribution Error". The error lies in our inclination to attribute people’s behavior to the way they are rather than to the situation they are in.
You want to make it easier to do something you want done and harder not to.
Peter Bregman wrote a great post on how your environment dictates your actions, where he explains how a simple move made all the difference for one of his clients:
One of my clients wanted everyone in the company to fill out a time sheet, and they were having a very hard time getting people to do it. Their mindset was compliance. They made it very clear that people didn’t have a choice. Everyone was required to do it. That worked for about half the employee population. The rest simply ignored it. The leaders were about to send out a memo saying no one would get paid unless the time sheet was handed in. But wait, I asked, do we know why they aren’t doing the time sheet? We assumed it was because people didn’t care. But we asked around anyway. Well, it turns out that people didn’t mind the idea of filling out a timesheet, but they were frustrated by the technology. The online system required people to go through a series of steps (a wizard) in order to put their time in. It was meant to help them, but it took longer and needlessly delayed them. Not by much — 10 seconds at most — but that was enough to dissuade 50% of the people from following through. Once we changed the form and the technology it was on, everyone started using it. They weren’t being defiant. They simply weren’t walking the 10 feet and four steps to the table. The solution isn’t to explain to people why they should take the walk or force them to take the walk. The solution is far simpler: move the table.
Also mentioned in Bregman’s post is the book Mindless Eating and the study of how if you give people bigger popcorn buckets, they’ll eat more popcorn! This book has won him a loyal following of dieters who swear by his directive: Shrink your dinnerware. Use smaller plates, bowls and cups. Because he knows that if we use big plates, we feel obligated to cover them with food. A simple tweak is all it takes for people to eat less.
Tweaking the environment is about making the right behavior a little bit easier and the wrong behavior a little bit harder. It’s that simple. For an example think about Amazon’s 1-Click ordering. Amazon’s site designers have simply made a desired behavior – you spending money on their site – a little bit easier. They’ve lowered the bar to a purchase as low as possible, and by doing this, they’ve generated millions of dollars in incremental revenue.
From dodging customers to accepting them with open arms
An example of how a company that hosts people site’s changed it’s culture from ‘denial of service’ to become known for ‘fanatical support’ by making a simple tweak to the environment is Rackspace. Initially they didn’t pride themselves on customer service, they actually saw customer service as costs to be minimized. The more roadblocks that could be erected to keep the phone from ringing, the better the profits would be.
This is was Rackspace’s modus operandi until one furious customer who had been sending emails and leaving voice mails managed to track down company founder Graham Weston. Surprised, Weston asked the customer to forward the email’s he’d sent and promised to look into the matter. After viewing the emails he had the revelation that his business was not going to be sustainable by dodging its customers.
Rackspace soon set out transform itself from a company that dreaded customer support to a company that was passionate about support. He posted an aspirational banner on the walls: Rackspace gives fanatical support. Everybody embraced it but it had to be backed up with action.
What was the most dramatic action that really changed it all? Weston removed the call queue. Without the queue system there is no safety net. The phone would keep ringing until someone picked up. So when he threw out the queue system it became impossible to dodge the customer. This move was significant because by 2008, Rackspace was named one of the best places to work by Fortune and had passed AT&T as the highest grossing firm in the industry.
People didn’t change, the environment did
As you can see from these examples people’s character didn’t change, the environment changed. It became harder for people to follow an old behavior and in it’s place a new behavior became easier.
While none of these examples explicitly involves innovation, they do point out that if we want change a desired behavior we can start by tweaking the environment. This is why I like to mention W.L. Gore as an example of an innovative company that removed the biggest innovation obstacle of all, the typical management structure. Why is this important? Because if we want people to do something (like be more creative) we can tweak an environment for that to happen.
What if we want to replicate the creative collision that happens in cities such as San Francisco, New York and Hong Kong? You call Charles Landry who knows what makes these cities magnets of talent and then helps other cities design their infrastructure to become hotbeds of creative talent.
Takeaway: No doubt it takes time and effort to create change by tweaking an environment but it’s a lot more simple than asking/telling/waiting for people to change their minds. I’ve left a lot of examples out but I certainly encourage you to read Switch, because quite honestly it’s that good! Thoughts?
