Stanford University Press Blog

Innovation helps shape the HP Way

Looking at the histories of big companies, we often contribute their successes to the competent leaders and the loyal employees who follow their direction. But what if defiance could be even more of a breakthrough for a company’s success? In their book, The HP Phenomenon: Innovation and Business Transformation, Charles H. House and Raymond L. Price explain how not following the leader can yield great results for the individual, the leader, and the company. In a recent review in Forbes, George Anders commends House and Price for pointing out many of these sorts of bottom-up instances of success that were possible at HP.

It would seem like bad leadership to allow dissention to continue in your company, and even worse if these ideas that the leader rejects are good ones! As House and Price reveal, it is not bad leadership to create a company that is smart enough to run itself. One of the most intriguing anecdotes in the book is that of Charles House himself. As an HP engineer in the ‘60s, House was set on pursuing a large-screen electrostatic monitor. When he was told, “When I come back in a year, I don’t want to see that product in the lab!” by a superior, he took it as incentive to get the monitor out of the lab – and into production as soon as possible. When the monitor turned out to be a great success, House was awarded the “HP Award for Meritorious Defiance”. 

Who knew that ignoring a direct order from a superior could lead to success for all –profits for the company, awards for the defiant, and a successful product, which always reflects well on the leader. While House and Price’s account is certainly not advocating for complete defiance in business relations, it points out how success can come from the most surprising innovations.  For HP, seeking new methods of business management and surprising the world with new techniques is what helped to create the HP Way. Despite some flaws along the way, the stories of unexpected as well as the intricately planned successes leave House and Price very optimistic about the future of this ground-breaking company.

Are you in need of a transformation? Goldman on Transforming Toxic Leaders

We all encounter problems in the workplace at one time or another: your boss is too hard on you, you don’t get along with your co-workers. But these are minor complaints that most of us learn to deal with. Lately, there have been major concerns coming up about toxicity in the workplace. Alan Goldman, author of Transforming Toxic Leaders, discusses in an interview on Psychjourney Podcasts how “toxic” leaders affect the workplace and how, many times, a transformation of the organization of the system is what can remedy a toxic situation, not just an adjustment of the leader themselves.

Toxic leaders can be described in many ways and often share a set of common traits. These traits not only make them hard to deal with, but often contribute to their success. Narcissism, obsessive compulsive tendencies, attention to technical detail – these are all traits which can make a leader great at his trade, but horrible at creating a functional working environment.

Goldman asserts that while there are cases where a toxic leader would be toxic in any situation, in many cases you can eliminate toxicity by reorganizing the structure of the workplace and putting experts in their rightful places. He uses the example of a surgeon who is a master of the technical aspects of his job but has no communication skills, yells, and makes his co-workers and patients feel scared or uncomfortable. Goldman coached the surgeon and suggested reorganizing the staff team so that the master of the surgical aspects of the profession worked in tandem with a surgeon with personal skills.

Overall, Goldman attributes toxicity in the workplace to individual psychology and staff organization – the latter being infinitely easier to deal with. With these ideas in mind, one might ask if toxicity is a necessary result of becoming a successful leader. Is it possible to become a master without creating a toxic environment? Goldman seems optimistic that non-toxic environments can exist and that even if toxicity enters the workplace, it can be eliminated.

Perhaps the next time you go to work you’ll look around and ask if your work environment is “working.” If not, how can you eliminate toxicity?

Author James March named Gurus' Guru by The Economist

James March has been named one of the gurus in a list complied by The Economist Guide to Management Ideas and Gurus, announced in an article in the Economist. We congratulate James March (author of Explorations in Organizations and The Dynamics of Rules: Changes in Written Organizational Codes) on this much deserved accolade. He is author of ideas, like satisficing, which has become part of the vocabulary across the social sciences and business.  It is the idea that we as consumers and managers go for the less-than-rational decision because we are restricted by human and organizational limitations (to mention two broad factors). As the Economist points out, March comes up with " colorful metaphors"  in which to package his theories, for instance, the "garbage-can" theory of organizational decision-making, which (once again) emphasizes the chaotic nature  in which problems are tackled and solutions assigned in organizations.  The solutions may not address the problems for which they were designed. And, what was the problem? Sound familiar?  Anybody who has ever worked for a company of any size can relate to that.  His other inventive metaphors include "technology as foolishness" and the "hot-stove effect."

With his full embrace of  organizations as both rule-based and imperfectly adaptive and complex systems, it is no wonder that Professor March finds much inspiration in poetry and in the work of Cervantes.  His most recent book with SUP, Explorations in Organizations, considers theories of organizational action, the ways in which organizations continue to adapt, and the uses of literature in the study of organizations.

Southern California as a Blueprint for Obama's Administration

Smile Southern California, You're the Center of the Universe a recent book by James Flanigan, with its sunny cover and celebration of the prosperity of the region, is at first glance wildly at odds with our current economic recession and California’s enormous budget deficit (somewhere around $16 billion, at the latest estimate). James Srodes, a financial journalist at the Washington times, points out in a recent review that at first it may seem as if this book was only relevant before economic crisis; because in the time it has taken to be written and published, California has suffered the same downfalls as all the other states and in fact currently has the worst budget deficit of all the states. He goes on to say that this is not a negation of the importance of Flanigans work. In fact, the book can act as a  sort of blue print for how a society can rise and prosper within the quickly changing international arena.

"First, there is international trade, which is now a leading contributor to the U.S.  GDP in a world economy swelled by billions of new participants — principally the enormous populations of Asia, Latin America and Eastern Europe. In today's world, however, industries and countries do not merely exchange goods and services but collaborate in producing them. This is a new paradigm and a richer exchange.” (Flanigan)

No matter what criticisms may come to southern California, Flanigan makes clear that the region is a picture of globalization and flourishing trade; not to mention the fact that Southern California has become a modern “Ellis island” in terms of immigration.

"Southern California became the new Ellis Island and reaped economic energy as immigrants started businesses.” (Flanigan)

California has transformed from having a base of government funded science and technology research centers to relying on a knowledge-driven economy supported by the many world-class research universities of California; and the author shows that the research provided by these institutions can pave the way for the new administration in its quest to come out of this economic slump. Flanigan’s research itself certainly warrants national attention, and, as Srodes points out, can be used to “offer a direction that Mr. Obama and his planners would do well to consider — and promptly.”

One last look at 2008

After the hiatus of the holidays and before we plunge into book news for 2009, I wanted to mention two books that made it on the bestsellers lists.

The China Beat mentioned Joan Judge's book, The Precious Raft of History, as the best book on Chinese women in 2008!  Judge looks at China's transition to modernity through the lens of changing perceptions of women. In particular, changes in representations of women in female biographies.  The book provides rich portraits of China's first generation of female political activists, overseas students, schoolteachers, and public writers,  who exemplified modern China.  However, Judge questions the success of these newly defined gender categories in redefining women's everyday lives.

And, 800-CEO-Read named David Herold and Don Fedor's book, Change the Way You Lead Change: Leadership Strategies that REALLY Work  as a runner up for the Best Business Book of the Year award in the HR and Business Development category.  Here is what the folks at  800-CEO-Read said about the book:

"Change has been the buzzword of the year, but only a few books have addressed change management in truly innovative and constructive ways. In Change the Way You Lead Change, Herold and Fedor examine flaws in change initiatives and take the results of their extensive research to advocate a more philosophical, holistic approach to change, starting with the leader's responsibility in understanding the context in which he or she is leading."

Congratulations to Joan Judge, David Herold and Don Fedor!

Do Performance Appraisals Really Measure Your Performance?

 In an article and podcast in the WSJ,  Samuel Culbert answers this question with the an emphatic no.

Although an army of HR consultants, HR professionals, and change management gurus would have us believe that managers should devote more time and energy to performance reviews, Samuel Culbert author of Beyond Bullsh*t, dismisses performance reviews as no more than "disorienting corporate theatre."  Inevitably they are political and subjective.

According to Culbert, this is because the boss and subordinate approach these appraisals from starkly different positions.  While the subordinate wants to secure the highest possible raise, the boss wants to talk about how the subordinate's  performance can be improved and where it is lacking.  What is worse, in Culbert's view, is that appraisals inject an unhealthy dose of bullsh*t in daily working relationships and often result in permanent schisms in the boss/employee relationship.

Culbert's alternative and innovative proposal is the de-linking of pay and performance reviews.  It is based on the desire for a workplace based on straight-talk and trusting relationships (for a full picture of what such a work culture would like you will need to read the book).  Straight-talk requires a paradigm shift in performance-based compensation.  It requires recognition of the fact that pay is a marketplace-dependent variable, and performance is connected to boss/subordinate chemistry and the ability to actualize predetermined company goals.

Culbert’s Beyond Bullsh*t Reviewed in Financial Times and Times Higher Ed

Beyond Bullsh*t (2008), Samuel A. Culbert’s engaging guide to straight-talk at work, has gotten some significant attention lately. Stefan Stern recently wrote a piece on the book for the Financial Times in which he says: “It is not, as you might expect, an appeal for honesty at all costs. Rather, the book takes a sophisticated look at why we talk to each other the way we do, and why a certain amount of BS at work may be necessary and even advisable.”

Susan Bassnett also reviewed the book for Times Higher Education, in which she explains: “Culbert's basic premise is that bullshit is inevitable in any working situation. Without it, he says, ‘the workplace would be about as serene as the lawless Wild West’. He shows, through a series of examples, how interaction in a working context involves a whole range of strategies and subterfuges, some of which aim to deceive, and others to shield people from a truth that might be unpalatable.”

Beyond Bullsh*t’s basic tenants have also caused a flurry of blog posts. The Assess Systems blog writes: “Readers will find this book personal—which is unusual for a business book; they will think that many of the stories are about them. They will be engaged and delighted as the text demystifies the obstacles to getting beyond bullsh*t and guides them in developing straight-talk relationships at work.”

 

Sustainability Is Needed for Business Leadership

According to the Alliance for Climate Protection, the organization running the “We” advocacy campaign that former Vice President Al Gore launched this morning, “many Americans are concerned about climate change but don't know what to do about it.” Stanford author Chris Laszlo is reaching out to business leaders to show them that they can actually become more profitable by making their companies environmentally conscious.

A “clean energy economy” is one of the solutions proposed by the We campaign, which agrees with Laszlo that sustainable business practices would help the US economy:

A clean and efficient economy would “lead to over 3 million new green-collar jobs, stimulate $1.4 trillion in new GDP, add billions in personal income and retail sales, produce $284 billion in net energy savings.”

In a recent interview, Laszlo argues that the economy has fundamentally shifted so that US companies must pay attention to environmental concerns if they want to remain competitive:

What has happened is that the marketplace has changed and today if you want to make an economic profit you have to pay attention to environmental and social issues in your business… because they’ve become enablers of competitive advantage. So we’re back to just a single purpose gain. So companies have come out with products that have environmental intelligence built in. Consumers tend to prefer those products if they don’t have to pay more for them.

Laszlo’s book, Sustainable Value, not only presents his argument for the necessity of sustainable business practices, but also provides the tools necessary for leaders to move their companies along that path.

Creating Sustainable Value

Chris Laszlo argues in his latest book, Sustainable Value: How the World’s Leading Companies Are Doing Well by Doing Good, that far from being a cost to society and business, sustainability is emerging as a huge opportunity for both.  CEOs of some of the world’s largest companies—General Electric, Toyota, and Wal-Mart, to name just a few—are motivated by the desire to gain competitive advantage in a business environment transformed by rising fuel prices, widespread concern over the impact of climate change, and heightened consumer awareness of health and environmental issues. For more information on the book visit: www.sustainablevaluebook.com

Hollywood v. Technology; Studios v. Consumer

Radiohead’s “pay what you will” release of its newest album, In Rainbow, earlier this month sparked renewed speculation about the outcomes of the entertainment industry’s troubled interactions with a world moving away from purchasing CDs, DVDs, and tickets to a movie theater, and other bands are already following their lead. 

In Coming Attractions?, Phillip Meza gives us an in-depth look at the difficulties Hollywood and the music industry have had in adapting to the rapid rise and evolution of digital technologies. As the entertainment industry has fought to limit access to the content it produces through encoding (DRM) and stronger copyright laws, its customers have increasingly come to view its interests as at odd with their own.  Instead of acknowledging that the consumer is calling for new kinds of access to content, entertainment companies have reinforced the us vs. them perception; after all, “suing your customers is a terrible idea.”

Meza provides the entertainment industry with a roadmap for rescuing itself from entrenchment in dying practices and the disdain of the consumer. A recent review from the Midwest Book Review says that you “will find Coming Attractions an outstanding, specific survey key to understanding long-standing issues, conflicts, and relationships between entertainment, high tech and media industries alike.”

You can listen to Meza discuss these issues here.