Author: Brook Manville

How often do we blame leaders who don’t live up to their supposed wisdom and experience? Why did the all-knowing Alan Greenspan miss the housing bubble that launched the Great Recession? Why did Marissa Mayer, the whiz kid from Google, fail to turn around Yahoo? How did the ever-intelligent Barack Obama so clumsily launch his national healthcare plan?

In the Knowledge Age, leaders are the embodiment of meritocracy—power and authority for those with the best talent, skills, and ideas. We praise them in times of success, but when they get something wrong, we’re disappointed. Or worse, we rage about the incompetence of “the supposed elites.”

Of course leaders must take accountability for ultimate performance of their organizations–but in actual practice success is not just a result of their own wisdom; it’s also about—and increasingly more about–leaders’ ability to manage the smarts of others. Great leaders today deftly mobilize specialists and experts around them, and also across networks beyond.

Wrangling The Know-It-Alls

Alas, however, specialists and experts are never infallible; and knowing how to assemble and take best advantage of them is its own leadership art. So what’s the best way to wrangle the “know-it-alls”?

We might begin by first understanding how and why experts can sometimes fail the enterprises they are contributing to. This isn’t just explaining the limits of individual human judgment—there’s plenty of research already on that, and, yes, even specialized  pros make mistakes sometimes. The real issue is how experts can waylay or block a leader’s organization from making good decisions collectively.

Mistaken Experts

I owe this insight to some intriguing new research recently published by business professors Juan Almandoz and Andras Tilcsik. Their paper (Academy of Management Journal 2016, vol. 59, no. 4) cleverly investigates how the practice and behaviors of experts themselves can be the ticking time-bomb within organizations—especially in particular situations.

Almandoz (IESE Business School) and Tilcsik (University of Toronto) examined the impact of “domain experts” on corporate boards. They posed an elegantly simple question: when directors have significant professional experience in the industry of the company they are helping to govern, how does that affect its overall performance?

The researchers examined failures and other negative organizational outcomes for a large sample of local banks in the United States, 1996- 2012; and then probed for patterns to explain what happened, focusing particularly on the composition of the boards of the banks.

Counter-intuitively, they found the higher the proportion of domain experts on the banks’ boards—people with deep knowledge and experience in the industry– the greater the likelihood of organizational failure. (Their findings confirmed analogous research about the limitations of board-based experts in other industries, e.g. solar energy).

Why was domain expertise on the board not just an occasional asset but also sometimes a liability for overall performance?

Explaining Performance Decline

Three themes explained the higher-than-expected rate of performance decline (or even disaster). The researchers’ conclusions will be quickly recognized by anyone who works with experts today.

First, specialists sometimes offer advice that is sullied by “cognitive retrenchment” –framing strategic challenges following current orthodoxy, and underappreciating emerging changes in their company’s operating environment; second, experts can be guilty of overconfidence—trusting too much their own ability to see and analyze problems; and, third, experts limit “task conflict”—a fancy way of saying specialists can be prima donnas who shut down challenges to their views by others.

In sum, experts can get it very wrong because they get stuck in their self-assured, arrogant ways. Their wisdom and confidence become blinders to urgent reality and their behaviors block more creative thinking by the organization they serve.

Sound familiar?

But One Critical Condition

Almandoz and Tilcsik contextualized the conclusion with one all-important condition. Though board-level domain expertise was indeed helpful in stable and “normal” operating conditions in the banks they studied, it was more conducive to organizational failure in situations of high decision uncertainty. More negative outcomes prevailed when there was unpredictability caused by, say, rapid asset growth by a bank, or if an institution was trying to compete in a fast-changing market.

Poor performance thus actually resulted from what might seem a confounding paradox: the more ambiguous the situation, the more a leader might look for guidance from  directors “who really know”—but then get less good advice from their expertise because it is tinged by overconfidence or yesterday’s assumptions. The experts’ mindsets and practices, by blocking more discussion or non-traditional ideas, often throttled their companies’ chances to change direction and thrive—or even survive.

At first this narrowing of the conclusion to “conditions of uncertainty” might sound like a pretty limiting condition. But how rare is uncertainty in today’s turbulent world? Who isn’t trying to navigate some uncharted waters of global competition? Deal with unpredictably disruptive technologies? Foresee unimaginable financial and political risk?  If uncertainty raises the negative risks of expertise, the dangers of depending too much on “smart people” is surely rising every day.

The Double-Edged Sword

So what’s a leader to do? Who can afford not to call on experts when going into political or business battle? But when you do, how do you also ensure they don’t impose the behavioral bottlenecks and cultural vulnerabilities for your organization, such as those that Almandoz and Tilcsik discovered in their study?

My own research, and familiarity with emerging practice of many leading practitioners in cognitive science and organizational design suggests several ways forward. For convenience, I map some suggestions to each of the three expert-related liabilities identified by Almandoz and Tilcsik.

Manage Against Dysfunctions

1. Offset experts’ “cognitive retrenchment” by “opening up” the organization. Leaders today are increasingly exploring how to source new ideas from across the silos of their company and beyond its boundaries. They’re motivated by the fear of fighting battles with yesterday’s assumptions and models, and the biases of “not invented here”—even if those once produced “best in class.” Whether it’s co-creating products and services with customers, pursuing open innovation competitions, launching cross-company conversations to build strategy “bottom up,” building networks of problem-solving communities or interconnecting “teams of teams”—the best leaders are not just tapping into wider expertise, but also building networks that hedge against excess influence of any small circle of “knowledgeable” (or maybe not-so-knowledgeable) voices.

2. Mitigate experts’ overconfidence with contrarian decision-making structures

In recent years great leaders have institutionalized mechanisms that promote “thinking differently.” In its simplest form, organizations distribute decision-making authority that ensures input and problem-solving with groups beyond the senior executives. Red Hat, for example, recently launched an open decision framework, to guide decision-making in step with its culture of open participation and meritocracy.

More and more companies are building data-driven analytical capability to enhance–or sometimes correct—the judgments of traditional experts. Other organizations now call on scenario planning (pioneered some forty years ago by Royal Dutch Shell) to test alternative futures; some also create “red team vs blue team” problem-solving which pits different approaches (and often competing experts) against one another—to help identify hidden assumptions and more creative strategies. (The methodology was famously used by JFK with the circle of experts and advisors supporting him during the Cuban Missile Crisis).

Still other organizations have employed so-called “pre-mortem” analysis—investing in prospective what-if problem-solving, starting with the imaginative premise that a decision about to be taken has gone on to fail. The exercise is yet another way of surfacing unconsidered assumptions, or implementation traps lurking beneath a pending decision. Pre-mortems can thus help keep the overconfidence of experts in check.

3. Soften “task conflict” imposed by experts by clearly defining process accountabilities

One familiar reason organizational decisions go wrong is confusion about the differing kinds of input and authority related to who has the final say. Some leaders err on the side of engaging—and then ignoring—the input of experts; others too often abandon authority to this or that “advisor” when delegation is not called for. And assumptions about who in an organization has what role and weight  for different kinds of decisions are often cloudy—until realities are revealed, too late, as they erupt in after-the-fact finger-pointing.

Good leaders clarify roles, responsibilities and authority for important decisions—before they are made. Multiple tools and frameworks exist to guide such efforts (e.g. the RACI matrix, or Bridgespan’s RAPID). By deploying such frameworks, leaders might specify that experts will simply be asked for input, or they may be charged with more responsibility—but the question of the role they are being asked to play versus that of other stakeholders is specified and agreed upfront. With everyone’s responsibility and authority clear from the beginning, there can be more collaborative problem-solving, and less Monday-morning-after blaming.

Building Learning Cultures

A more general prescription for problem-solving and decision success–especially when experts are involved– is to build an organizational culture that honors learning and continuous improvement across all levels and networks. The organizations with the best collective judgment encourage debate and dissent both high and low, as part of doing business; insist on fact-based analysis; create “safe spaces” for no-recrimination challenge and brainstorming; and provide visible support for learning from mistakes as well as successes.

When leaders set the values and tone for everyone learning for better performance, there’s more chance the gurus will contribute without dominating or getting trapped in their own biases and egos. In such enterprises, domain experts can be the best they can be.

Some Ancient Wisdom About Expertise

An ancient Athenian general called Alcibiades was known for both his brilliance and occasional treachery against his native city in war. The comic poet Aristophanes described the ambivalence of his countrymen, about this man they considered invaluable but also deeply dangerous: “They loved him, they hated him, they couldn’t live without him.”

And so today for you who must inevitably–but also dangerously–depend on experts and deeply experienced specialists to do your job. In the Knowledge Age, you will love them, hate them, but must also find ways to manage them, within  and even beyond your organization—however brilliantly wrong they might sometimes be.

Originally published on Forbes.com

Right now your job probably means being part of team—or even several. Collaboration, group problem-solving, and shared responsibility for deliverables are now norms of organizational life. You may think of yourself as a spirited individual, but you really don’t work alone anymore. You belong to today’s teaming masses.

Some of us like the collegiality of  teams, but others  find them a huge source of frustration. Too much talking, unclear responsibilities, group-think instead of action: can’t we just get on with it? Why is all this team stuff taking so long?

What Makes Teaming Hard?

Such questions swirl daily as teaming continues to grow as a trend. Deloitte’s 2016 human capital survey reported nine out of 10 global leaders are redesigning their organizations, shifting towards networked cross-functional teams. Yet, only about 20% of the surveyed executives reported their expertise to do that.

Welcome to the 80%. Teams are hard to make work—and most people have trouble understanding not just how but why. Hackman’s lament lives on:“teams usually do less well—not better—than the sum of their members’ individual contributions.” A recent essay by T.J. Elliott hypothesized that our ongoing bumbling with teams may help explain the mysterious flagging of American productivity.

Meanwhile, no shortage of research about how to “fix the teaming problem.” Most targets the interpersonal human issues: create more empathy, transparency, safe spaces, less ego, etc.  All good things to have in a workplace—but for my money, building a “better community of relationships” doesn’t get to the deeper value of managing effective teams.

Back To The Sources

So I thought it might be time to return ad fontes: back to the sources. Why in the first place did teams get invented? What historically has made them most successful?  I called the two guys who put teams on the modern business map: Jon Katzenbach and Douglas K. Smith

Of course they didn’t “invent” teams (as old as humanity itself)—but their 1993 global best-seller, The Wisdom of Teams: Creating the High Performance Organization—was a breakthrough in professionalizing the construct: the first focused analysis of what became a revolutionary business phenomenon in the dawning age of globalization, the Internet, and large-scale organizational change (Yes, Virginia, there was an earlier time when most businesses did NOT expect everyone to work in teams). Wisdom of Teams has been issued and re-issued multiple times, selling over 500,000 units and used by millions of practitioners across the globe.

“So what, gentlemen,” I asked, “has been learned about teams and teaming since you first published your book? Are the lessons from 1993 still valid? What’s changed? And why does teaming still cause so much heartburn in the business world?”

Katz (as he likes to be called) and Smith wrote the book while at McKinsey in the early 1990s. Still friends today, they’ve gone their separate ways since then. Katz now heads a PWC organizational research center while Doug runs his own consulting practice focused on “challenge-based leadership” for organizations across all sectors. Together they have an awe-inspiring legacy of published research and front-line experience in building team effectiveness. And they still have plenty to say about the subject that launched their global best-seller a generation ago.

Six key learnings from my recent conversations with them:

1.Teams Matter Because They Are The Critical Engines Of Change

Most of us understand that today’s harsh global competition puts an increasing premium on leveraging different skills and experience for world-class innovation and problem-solving; in the Knowledge Economy, more knowledge—mustered among smart people working together– wins. Teams done right outcompete individuals any day.

Doug Smith reframed the common wisdom from another angle:“If you look back through history, no major change has ever happened without some kind of team. Change is driven when a team rallies together to meet a challenge, and create some higher level of performance—beyond what any individual can effect alone.”

“We conceived our book when Katz and I realized that everyone in the early 1990s was writing about ‘change management.’ Organizations today, more than ever, must struggle to change and adapt. But the first generation of change thinking was operating at too high level, ignoring what makes for actual success on the ground—small groups of committed people. We both realized it was time to tackle the fundamental unit of analysis for meeting any competitive challenge: teams. With today’s volatile operating climate, teams are becoming even more critical.”

2. Successful Teaming Requires Understanding Why A Team Exists.

“So what actually is a ‘team’?” I asked. They summoned up the verbatim essence of their book: “A small number of people (typically fewer than ten) with complementary skills who are committed to common purpose, performance goals, and approach– for which they hold themselves mutually accountable.”

Each of the phrases matters, encapsulating the key success factors extracted from hundreds of teams they originally studied. Nothing they’ve seen since 1993 has substantially changed their minds.  “It’s not accidental that we have always described this as a discipline,” reflected Katz. “The same pattern holds today. Success absolutely depends on the would-be team adhering, consistently, to each of the dimensions in our framework. For example, a team might be the right size, agree on performance goals and purpose, but not about a shared way of working together. If they don’t, they’ll fail.”

Smith underscored an under-appreciated element. “Everyone talks about organizational purpose today, but too often they forget about performance. We very intentionally combined and stressed both.”

“Purpose has always depended on performance, and vice-versa. Winning for a cause that the team cares about provides the energy that distinguishes a true team. Thousands of years have shown that when people focus on something beyond themselves—and achieve goals towards that end—it brings out the best in everyone. Morale doesn’t come from picnics and backrubs in the office. It comes from people succeeding together.”

3. Missteps With Process And Application Undermine The Discipline of Teams

So why is this taking so long? Smith was adamant about organizations’ continuing confusion between activities and outcomes. The misunderstanding plagues teaming because “people believe that ‘the process of being a team’ is more important than the performance goals that justify why a team exists. As soon as the objective is seen as ‘becoming a team,’ people lose sight of the fundamental performance purpose for working together.”

He elaborated with a metaphor. “You can throw a stone into a calm lake and then become obsessed with the ripples of the splash, and the ripples of the ripples. And soon you’re forgetting about the central core — where and why you threw the stone in the first place.  When people get caught up with topics like trust, structure, rapport among members, they can blur the existential purpose:  performance, performance, performance. Google’s Project Aristotle missed the whole point. They focused on HR-style correlations for effectiveness, but not the root cause of success: when team members relentlessly commit themselves to achieving higher performance.”

Katz highlighted a second barrier. “We always said that a team approach is not suited to every situation. Leaders struggle if they try to turn everything into a team.”

“Good work can productively get done—without the overhead of a team– by what we might call a simple ‘working group.’ A looser assembly of people can exchange information and collaborate without committing themselves to shared goals and collective accountability—which are always difficult. Many senior executive groups, coming together from different business units in a company, function this way— but not as a real  team. Nor should they necessarily try to be.”

“Things are even more difficult today, because of the more complex organizational landscape: networks, communities, open initiatives, purpose-driven councils (e.g. to foster diversity or quality), value chains, etc. etc. To try to make any of these into ‘a team’—in the disciplined and focused manner of mutually accountable performance—can be disastrous. Team performance comes at a cost many situations don’t call for.”

4. The Discipline Of Teams Must Still Embrace Human Factors

Though both authors held firm to the all-important focus on performance as the purpose of teaming, they also acknowledged the relevance of human dimensions.

“We’re all much more attuned to the emotional aspects of management behavior now,” said Katz, “which I might amplify more in our story. Our book perhaps over-emphasized the rational arguments for successful teams.”

Doug offered a similar perspective. “Effective teaming is really a Venn diagram. The most important circle has to be the focus on performance. But I don’t want to discount a second circle of relationships—they are the social glue that sustains human interaction over time. Organizations, networks and communities are built on relationships.  Every team needs to consider them in what they do, overlapping with performance. Problems arise when leaders focus on just one circle—especially relationships–as the ultimate purpose of a team. That won’t work.  But ignoring relationships also violates a key element of the discipline: shared accountability.”

Katz added some additional insights about organizational cultures. “In recent years, I’ve come to appreciate the complexity of organizational cultures—I use the plural, because no company has just one—and the great opportunity they provide for establishing context and emotional energy that positively impacts building a great team.”

“Strong teaming benefits from existing cultural forces in a company—and most cultural challenges benefit in turn from applying the teaming discipline in key places. It’s a much more effective intervention than broadly trying to ‘change a culture’.”

5. Leaders Face Increasing Complexity In Building Teams—And Must Manage Accordingly

As Katz reflected on teaming and organizational culture, he amplified comments on relevant evolution of the last twenty years, and the implications for team-driven leaders: the increasing complexity of the organizational landscape that reinforce more nuanced judgment about when to take a team approach (or not); the shortening time-frames of business that requires teaming that leverages the episodic opportunity of different company cultures in different ways; the rising influence of historically under-appreciated informal leaders, often middle-managers, whose authentic and knowledgeable profile in a company naturally attracts people to work with them.

When I asked Katz specifically about the best leaders who build and guide teams, he emphasized action over words: “They model the performance focus and collective responsibility themselves. What they actually do for, and within a team, means twice as much as anything they say.”

6. Well-Run Teams Allow Every Organization To Reach Higher

Doug Smith finished on a more philosophical note, revisiting his 2004 book On Values and Values. “With technology and other global changes of the last twenty years, we don’t have place-based structures anymore. People increasingly live in networks, markets, and yes, often teams. Ultimately the endgame has to be to rediscover a safe and fair society for all.”

“Good leaders understand the way to achieve that is to effect change, by bringing together performance and purpose with their people, for something bigger than everyone. In the best case, teams—and then indeed teams of teams—are a building block to achieve that. The discipline of teams we talk about is not just strategic; it’s also a fundamentally moral value. What could be more relevant today?”

Originally published on Forbes.com

The “Airbnb community,” the “Linux community,” the “Nike running community”: In our networked age, who isn’t talking about “community” as part of their strategy?

Well, why not? “Community” now handily implies group solidarity or mass collaboration across any unstructured population—enabled by global interconnectivity.

But when the ancient Romans invented the concept (communitas), would they ever have imagined so many current “community” business models? Gig Economy platforms, open source movements and organizations, sustainable value chains, learning networks: Great Caesar’s Ghost!

But What Does It Mean, And How To Do It?

But today’s corporate chase of “community” is no guarantee of strategic success. Too many leaders are trying to build (or reshape) a business around the concept without understanding what it means. Or how to ensure that a networked community both flourishes and supports business goals.

So how to do that?

I turned to a leading practitioner and networked community builder in his own right, Charlie Brown, Founder and CEO of Context Partners.

Talking With Charlie Brown

Charlie has worked on networked communities for some fifteen years. We first met in 2008 when he was running Ashoka Changemakers, a pioneering innovation community of social entrepreneurs. Charlie left to launch Context Partners in 2010; the Portland (OR)-based company now works with leading edge enterprises on these kind of strategies. He’s built a lot, seen a lot, and has plenty of smart thinking to offer.

Context Partners Provides Context

I began by asking this CEO of Context Partners for, well, some context: “Why are ‘networked communities’ such a big deal for strategy today?”

“Because of three fundamental shifts all around us—touching everybody. Technology is the enabler but the real changes are social, psychological and organizational.”

“The first shift is ubiquitous information: everything more transparent, everyone more specialized. Second is identity. Everyone now wants to engage with companies, organizations or products that reinforce who they are. We’re all trying to connect ourselves with particular values, and something bigger than our own lives.”

“Third is power. Just because you’re atop a hierarchy, doesn’t mean you’re the smartest anymore. Structure-based coercion and transactions are giving way to relationships. Value is increasingly created by ‘horizontal work,’ connecting smart and passionate people across boundaries, achieving greater scale of talent.

“The three shifts are positioning ‘community’ as the new nexus of strategy; and of course it no longer requires geographic proximity. The flow and desire of people, virtually and across boundaries, towards different kinds of ‘belonging’ is creating new business opportunities for savvy leaders.”

Terminology Matters

I signaled time-out. “How do you define a ‘networked community?’”

Charlie smiled. “Start first with just ‘community:’ simply a group of people with shared characteristics or interests. They might live in the same neighborhood or be distributed across wider geography.”

“Essentially a passive asset with collective potential?” I asked.

“Yes. Passive because they aren’t necessarily working together, nor have they found their commonality. A network changes that—technology connecting people, making visible shared opportunities. Networks can structure collective action towards greater purpose. Networks bring a community alive.”

“When a community is activated this way, it becomes potentially valuable for a company’s strategy. If the company authentically embraces the goals of the group, the willingness of people to take action can magnify what the company itself is trying to achieve—by affiliating brand, products or services.’”

Designing A Strategy

“OK,” I probed. “How does a business leader design a networked community strategy?”

“Three key elements. First, shared purpose, as described. Once you identify a potential community—customers or other stakeholders—a leader must ask, ‘Why would these people want to join and work together?’ And then, ‘How can this be connected to my company, my brand, or the values we want to stand for?’ Your employees are in the mix too—they also become part of the community.”

Structuring And Incentives

“The second element is organizational: how can you use networks to foster relationships, share information, and provide new roles for people as they start to work together? Networks mobilize action without hierarchy.”

“Finally, incentives for membership. Traditionally these have been monetary, tangible (e.g. coupons or T-shirts). But intangibles are better for sustaining a community: fostering common cause; recognizing members’ community ‘identities,’ reinforcing the satisfaction of learning or contributing to some greater good.

Learning From Frontier Communications

“Let me illustrate with a recent project at Frontier Communications.”

“Our client Maggie Wilderotter was its visionary CEO. She saw the opportunity to differentiate Frontier from bigger players (Verizon, AT&T) with a networked community strategy. The strategy combined virtual and geographical concepts: it actually became a ‘community of communities.’

“The strategy began when Maggie realized that the rural areas and smaller cities of America—Frontier’s historical service footprint—were wrestling with two things today: first, finding their place in today’s urbanized society; second how to capitalize on ambitious, innovative people working to improve their local economies and livelihoods.

“Maggie then had a powerful insight: if Frontier could accelerate this initiative—across multiple locations at the same time– it would eventually benefit her business too. More prosperity drives sales and usage of telecom. Her slogan: ‘When local communities flourish, we flourish too.’ We worked with Frontier to create a network of innovating communities with a shared purpose to magnify the impact.”

A Networked Community of Innovation

“To pursue that, we helped Frontier launch a $10 million innovation prize, challenging interested American townships and small cities to submit a plan for bettering economic and social health of their own communities. About 350 locales have been competing. ‘America’s Best Communities’ (ABC) has now gone through several rounds, with eight semi-finalists recently selected. The plans submitted across the network have been creative and far-ranging: new civic engagement initiatives, neighborhood rebuilding programs, new regional tourism strategies, business-university entrepreneurship, etc.”

“The contest has created a networked virtual community of civic-minded innovators, motivated by shared goals. With Frontier’s support that ‘the rising tide lifts all boats,’ contestants have been learning from one another, making new connections across geographies, borrowing and building on ideas shared in the competition. This broader community of communities has supported Frontier’s business strategy—and vice-versa.”

Positive Results

In subsequent conversation, Wilderotter (now retired, but still active in the competition) reinforced this point: “It’s still early, and we have to keep measuring specific impact–but we have many anecdotal positives. The ABC process has definitely improved customer relationships and our brand reputation; also increased sales in the regions.”

John Puskar, Frontier’s ABC Director noted other benefits. “There have been no losers in the contest. Even cities eliminated in early rounds are still working and making progress on their projects. Though Frontier has always been engaged with customers, the contest nationalized a process of working locally and building win-win relationships.”

Charlie Brown spoke of more intangible effects.

“The competition transformed the identity of Frontier managers and employees. They now feel more responsible for these communities, and contribute beyond just doing their day jobs. It’s engaging them in their work as never before. Frontier, the local community volunteers, and other commercial partners are helping themselves by helping each other, and also the small cities and towns in America. The network is accelerating the innovation for everyone.”

Six Principles

My conversation with Frontier executives and Charlie Brown surfaced six general principles, helpful for any leader developing a networked community strategy.

1. Don’t over-emphasize technology.

Charlie warned of a familiar pitfall. “Technology is only an enabler.You can’t build and leverage a networked virtual community by just deploying some new social media. Or running a hashtag contest about your product. That won’t create meaningful long-term relationships critical to strategy.”

2. First engage the community about opportunity.

Maggie Wilderotter began ABC with “a listening tour”—talking to employees, customers and other leaders in rural areas and cities. She was “uplifted by how much work was underway by people collaborating to improve their local lives.” Context Partners built on that effort, as Charlie Brown noted, by “analyzing who these people really were, what they cared about, and how the existing efforts could be taken to greater scale. ‘Community’ starts with that understanding—by talking to the people themselves.”

3. Strengthen community by catalyzing collective action.

Though shared purpose inspires a community, getting people working together is what launches it and makes it come alive. Frontier built momentum in ABC when its regional managers began to convene interested citizens, business leaders, and other civic leaders, to start the problem-solving among potential contestants. John Puskar recalls how “the process quickly became infectious after that, spreading from one competing township to the next.”

4. Deepen community by helping members discover new roles.

Brown reflected on a more subtle behavioral pattern that shapes “community culture.”

“When collective effort develops, people slip into informal but identifiable ‘roles’—what they like to be and what they’re good at. Unlike their titles at the office, these reflect how people want to be seen in the informal working group. Leaders need to nurture these role identities as they emerge.”

“Some people become ‘builders’—organizing community tasks; others become ‘innovators,’ sparking new ideas; still others become ‘connectors’—helping members develop relationships with one another. As ABC grew, we watched these and other roles emerge, both locally and across the larger meta-community.”

5. Your company goals must align with—but be smaller than– the community’s goals.

To align your company’s interests with a broader community, your tail can’t wag the bigger dog. The higher purpose that motivates community members has to be more meaningful and timeless to them than just your business’s P&L. As a leader, your strategic art is figuring out how to become part of that purpose, without subverting it.

The Frontier CEO was inspired by the self-helping innovation of small cities and rural townships. She saw how Frontier could support a networked renewal process—“we thrive when they thrive”—but understood her company was simply contributing to the larger narrative of people improving their local livelihoods.

Charlie summarized simply: “A community must believe in something that would still have significance in the world, even if your company went away.”

6. Leaders must share and give away power. Despite the initial impetus and funding contributed to ABC, Frontier avoided mandates and control. Company managers were conveners, not decision-makers in the local planning; prizes were awarded by independent judges. Wilderotter emphasized, “We told the cities they could propose whatever they wanted, as long as it improved their quality of life and economic development.”

The former CEO later described her own leadership style, suited to today’s transparent information and horizontal responsibility. “I blended two styles at Frontier: ‘servant leadership’—giving up control, helping others succeed—and ‘relationship leadership’—looking for partners and other leaders, both in the communities and among our local managers, who could be multipliers of my effort.”

Looking Ahead

I finished by asking Charlie Brown about the future of networked community strategies.

“Everything tells us there will only be more. Some industries, certain companies, driven by a need for innovation will lead: technology, sales and marketing companies, healthcare, etc. Community approaches are also exploding in the non-profit world which has the mission to take big risks to solve big social problems.”

“But of course everybody is betting on innovation now. Is there really any company that doesn’t need some competitive edge through better collaboration among customers, partners, employees and other stakeholders? Eventually everyone will drink out of this faucet.”

Disclosure: In May 2012, Context Partners was a client of my consultancy, Brook Manville LLC.

Originally published on Forbes.com

“The mass of men lead lives of quiet desperation, and go to the grave with the song still in them.”

Thoreau’s lyric observation (adjusted for gender balance) might describe the modern workplace. Too many professionals not engaged in their jobs, plodding in fruitless search for “greater-than-me” fulfillment. In the Creative Economy, talent maladies destroy business value.

Two Harvard learning researchers, Robert Kegan and Lisa Lahey, propose an unusual remedy in their new book, An Everyone Culture.

They begin by reframing the problem: White-collar malaise is simply a symptom. The real issue, they argue, is us working stiffs are doing two jobs: one we’re paid for, and a second, silent and corrosive—here’s the desperation—politicking to hide weakness from colleagues and bosses. Job No. 2 is you constantly jamming the company radar to avoid revealing your limitations. And everybody does it, unconsciously or not, because everyone’s afraid of not being perfect. Small wonder, the authors imply, that productivity is staggering.

It’s Not About Freedom Or Perks

Kegan and Lahey’s solution bypasses the usual suspects. Everyone Culture is no cry for better corporate training, more freedom on the job, or bosses doubling down on farm-to-table cafeterias.

Instead, the book offers a hard-headed discussion about how to turn the “second job problem” into an opportunity, to increase any company’s effectiveness. Like others, Kegan and Lahey believe today’s “VUCA” environment—the volatile, uncertain, complex and ambiguous global economy—requires organizations with ever more agility and innovation. Which in turn depends on better, and continuously growing talent.

OK, how to do that?

Of The People, By The People…

The way forward, these researchers  propose, is building company cultures which fundamentally put everyone on the hook for developing themselves and everyone else around them. All the time, merged seamlessly with the business itself. Job No. 2 disappears when Job No. 1 is not just making the widgets but also improving your colleagues. Call it strategy of the people, by the people, for the people.

Meet The DDO

Kegan and Lahey sketch this aspiration via an analytical tour of three current, so-called “Deliberately Developmental Organizations” (DDOs): high performing, visionary companies, delivering exemplary results by obliterating their employees’ “second job.” These DDOs are transforming the lost time and energy of people hiding weaknesses by creating more transparent and developmentally-accountable ways of working. Goodbye to quiet desperation, hello to open and collaboratively-pursued professional growth.

DDO logic is simple: As assets lost to human dissimulation are improved and redeployed, you and your cubicle mates flourish–by the efforts of each other. The organization overall becomes more engaged and adaptive to change. Over time, collective performance soars.

Getting To Better

Kegan and Lahey aren’t promoting warm and fuzzy. Consider their account of  Bridgewater Associates, the world’s biggest and most successful hedge fund—and a prime DDO. Founder Ray Dalio demands gut-wrenching candor of his people: the ruthlessly transparent culture is tuned to making every employee a better performer (per the Bridgewater’s “Principles”).

Every workplace conversation is recorded, open to all; associates also use tablets to record “dots”—ratings and comments on everyone else’s mistakes and successes—constantly aggregated and then publicly discussed. “Issues” arising in daily interactions are tracked, and employees must use those to continuously improve “the machine” of their business. People are fired if they don’t get better: “We’re not in the business of rehabilitation.”

Work On Your Weak Backhand

Next Jump, another profiled DDO, promotes a similar ethos with a simple formula: “Better Me + Better You = Better Us.”

This e-commerce marketplace company attributes multi-year growth to systematic practice of its people exposing—and then working on– skill weaknesses (“your tennis backhand”). In monthly “10-x” meetings, employees take turns presenting to the whole company how they have individually contributed to revenue or organizational culture. Tough love about “how to do better” pours forth from the audience, for all to hear; in the future you’ll detail your progress, or explain what held you back. Teams regularly convene to provide cross-member coaching to strengthen each individual’s performance.

Not Just Fun And Games

Decurion, the third researched DDO, is a high-growth holding company, with businesses in movie exhibition (e.g. ArcLight Cinemas), real estate, and senior living. Its hierarchical structure is leavened by semi-formal (but regular) groupings of its people into problem-solving “learning communities.”

These communities tackle specific business issues through “fishbowl conversations” where chief actors openly work through assumptions and root causes, while other employees observe and comment. Hierarchy goes out the window; radical transparency and anyone-anywhere criticism for the greater good are expected.

Members of Decurion are told to “feast on their imperfections,” and follow axioms linking company profitability and individual professional growth. Nora Dashwood, Chief Operating Officer, is unambiguous about the interdependence: “We’ve seen a big difference in our revenues, [with] breakthrough results in every category. This is not just fun and games.”

Peering Into The Researchers’ Lab Notebook

These and other colorfully detailed examples make astonishing reading. For conceptual substance, Kegan and Lahey analyze the cases with a three-part framework (“Edge-Home-Groove”) which heroically assembles several organizational and behavioral theories into an overall psycho-dynamic model. Here, predictably, the pace slows, and the tone becomes more academic. But things perk up towards the end of the book, when the authors become more assertive about the business specifics of DDOs.

No one would accuse The Everyone Culture of over-simplification–but readers making the 292 page journey will find plenty of thought-provoking value. In fact, some of the challenge of the book is also its appeal: the array of charts and frameworks, coupled with vividly-told human accounts, of people grappling with business-driven mutual improvement,  sometimes reads like the lab notebook of two excited researchers. Their jottings and anecdotes draw you in, to join them in peering over the edge of what might just be a management revolution.

I spoke recently with Kegan and Lahey to learn more.

Plenty of Companies Thrive Without A DDO Approach: Why?

Lisa: “There are some businesses today whose strategic challenges are more ‘technical’ than ‘adaptive’ (i.e. more clearly known, not requiring continuous learning). Some companies—Amazon, perhaps—can also attract great people, chew them up, but keep finding more to keep going.”

Kegan countered that such organizational models are not long-term sustainable. “Though the forms may vary, the basic DDO approach is a harbinger of the future. More companies will to have to build this kind of capability to deal with the growing uncertainty of VUCA.”

“Most leaders today haven’t caught up with what neuroscience has discovered about humans working together and improving. Current DDOs are further along. Management science will increasingly leverage all the new cognitive and behavioral research.”

So If This Is A Revolution, Why Isn’t It Happening Faster?

“Doesn’t every hedge want to make as much money as Bridgewater? Why isn’t there a flood of new DDOs in every industry now?”

Kegan answered my challenge bluntly.

“These are hard places to work. It may be exhilarating for some people. But they’ll all tell you, ‘It’s not for the faint of heart.’  It’s very tough to face your own ego, deal with a brain inheritance guarding against psychological threat. I remember a cartoon: two guys selling different products, side by side in little booths. One guy’s offering ‘Comforting Lies,’ the other ‘Disturbing Truths.’ Guess who has all the customers?”

Does DDO Also Apply To the Emerging World Of Networks And Cross-Boundary Ecosystems?

The question at first surprised the authors—but after a pause, both reflected how the studied DDOs are all making conscious efforts to share— even extend—their special cultures to other stakeholders.

Lisa noted that Bridgewater employees actually “develop relationships with their clients quite consistent with what they do in their own organization: bold discussions, feedback given, no ‘second jobs’, etc.” Bob remembered that “Next Jump has an explicit goal of not just bringing  services to their customers, but also intriguing them with a culture of ‘Better Us.’  And Decurion talks about acting out their beliefs in the ecology in which they operate. When they were developing a new assisted living business, they used their philosophy of managing conflict to overcome  difficult permitting challenges with California regulators—in record time.”

If A Leader Wants To Build A DDO Culture, How To Get Started?

Lahey answered quickly. “The leader first needs to ask, ‘Why do I want to do this? What’s the problem that can’t be solved by some other means? Next:  ‘Can I work in this very different way—be intentional in growing my performance edge? Be open to feedback—from anywhere?’”

Kegan added more. “The leader has to be an exemplar, a player, not just watch with hands folded. And he or she can’t just do this to feel good. They need fire in the belly, and commit to making the company better by making the people better. It calls for advancing a vision, and giving up some power– and also expecting the same of other senior people.  They also have to be willing to be criticized by associates half their age.”

He widened the aperture further. “It also entails reconstructing all your metrics and assumptions. What it means to do a job, time you spend on other people, whether you see a fire burning as a problem or an opportunity to learn. It requires an open mindset: ‘I’m undertaking an experiment to work in a new way that’s could make a big performance difference. Can I bear the cost and risk of making the change?’”

Looking Ahead

Lisa and Bob explained that the book is just a first phase of research: “We had to begin by  identifying a few pioneering beast in the wild, and understand their unique ways of using this DDO culture as strategy.”

“OK,” I said. “What questions would a Phase 2 pursue?”

The authors finished with a flourish:

“How best to build the practices of the core framework? Can organizations develop a DDO without first experiencing failure? What’s the psychological safety needed to support the personal transformations?”

“Can this model be scaled, for larger and more impersonal corporations?”

“Other sectors: can DDO improve public schools? Health care, non-profit and government organizations?”

“How can we expand the practice everywhere–so everybody can stop doing their ‘second job’?”

Originally published on Forbes.com

Looking back to 1996, on her first senior job at Xerox—as VP of HR–Anne Mulcahy laughed gently. “The position was historically under-rated and bureaucratic—and, frankly, that reputation was earned.” In a few short years and plenty of hard work, she undid its bad reputation, giving lie to friends’ warning about the “corporate dead-end.”

In a few short years again, in 2001, this former, successful HR leader was named the Xerox CEO.

By the end of the decade she was hailed as one of America’s great corporate leaders for her dazzling, multi-billion dollar turnaround of the debt-swamped corporate behemoth.

Did HR Leadership Help Build This CEO?

Her strategy of relentless cost-cutting, organizational focus, and boosted innovation is now a well-known story. Less explored have been the sources of personal growth and knowledge that underpinned her exemplary leadership performance. And in particular, whether the unlikely stint in HR for this “accidental CEO” (as she was also called then) somehow contributed to the corporate achievements beside her name in today’s business school textbooks.

The question began our conversation. I wanted to look back to an earlier, less talent-intensive era—when women didn’t become CEOs and real leaders didn’t “waste time in HR.” Top jobs were for corporate-groomed, MBA-equipped men, coming up through finance, strategy or business unit leadership.

Looking Back On The “Dead-End” Job

“Anne, what were you thinking, joining HR in the ripeness of your career? Are there  lessons for leaders today—and tomorrow—about the value of taking a job in the people function, en route to running a global corporation?”

She began her reply with some context. “Becoming CEO was not on my radar screen when I signed on to HR. It came into focus later, a convergence of several unpredictable circumstances, and after I had  done a couple of other jobs at the company. And then I was in the right place at the right time.”

“Another executive brought in to lead an earlier restructuring of the company before me had utterly failed as a people leader. By about year 2000 the Board was really stuck—and decided an employee-oriented insider was needed to head Xerox after all the disappointment and turmoil. I also have to give credit to the mentoring and support of the Board and Paul Allaire, whom I had served as Chief of Staff in the transitional years just before that.

“But,” I pressed further, “did leading HR in the late 1990s still play some role in your leadership development?”

“Absolutely–but I didn’t fully realize how at the time. My career path at Xerox was pretty erratic. I never followed a traditional plan of development. I had done well in Sales for many years but I didn’t want to just keep climbing that ladder. I was looking for something new. HR was my first really senior position, and it taught me how to operate with other people at that level.”

Erratic Like A Fox

Looking back, Mulcahy imparted more logic and savvy to  her “erratic career path” than she might have acknowledged at the time. Her learn-by-doing  approach, if unconscious, targeted two critical branches of any corporate strategy: markets and the organization needed to serve them.

“What I took away from my sales experience was a deep understanding of Xerox customers–seeing through their eyes how to create value. When I was offered the HR job, it was a chance to learn through another set of eyes—Xerox people and the keepers of our company culture. I was always fascinated by issues of talent, organizational effectiveness, and leadership development. HR was my opportunity for that.”

Mulcahy further explained that her HR experience built key credibility for later leading the painful cost-cutting and organizational changes that ultimately rescued Xerox. “I always said when I started the turnaround, I had a lot of ‘leadership money in the bank’ to draw on. Without it, I never could have pushed through the changes we needed. My years in HR were a big part of how I built that up.”

Building Capital For The Leadership Bank

In fact, listening to her several stories, I sensed her HR service did not just help her build credibility; it also developed critical knowledge, relationships and an operating platform, all fundamental to this turnaround CEO. Borrowing from her own metaphor, I credit Anne’s HR leadership for three significant deposits to the Mulcahy account:

1. Network Capital: “It was my first global job, and for the recruiting, development, performance management, and diversity, HR was an ongoing opportunity to connect with leaders all over the world—heads of lines of business and all the geographies. They had to become my partner and I had to become theirs. I got a huge payoff from this network—especially senior leaders—all of whom became really important to me later as CEO.”

“Because of the nature of the work, it became a real network. I didn’t report to the other leaders, so the relationships were not about power. I built credibility by working together, side by side, with every one of them, on people issues. It was an opportunity to earn respect as a peer. It  changed who I was in the company.”

Right People In the Right Jobs With The Right Feedback

2. Talent Development Capital: “I was determined not to do traditional HR—imposing process for process’ sake. I focused on impact—solving problems with people around the world about getting every right person in the right job, defined and evaluated the right way. It was building and upgrading an overall talent management system.”

“I had a few breakthroughs. The first was creating new expectations—and practices—around giving honest feedback. I discovered how few people were really being told where they stood in their performance, and then helped to get better. It was demoralizing and holding back performance everywhere. I pushed hard to change that—delivering the gift of honest, just-in-time, continuous feedback and improvement.”

“Second was talent alignment. Many of our people didn’t understand how their jobs fit with the strategy and goals of the company, and didn’t feel any real connection. We got a lot better at that, and people found it very refreshing.”

“Lastly was ensuring accountability among leaders to manage those things honestly and consistently. They couldn’t be bureaucratic or hide behind vague ‘pats on the back’ with their people. I had to learn how to challenge other leaders during talent reviews—while still being diplomatic, which is its own important leadership skill. I also had to model that kind of behavior myself. I reinforced those values when I became CEO. Everyone feels better working for an honest organization, especially when big sacrifices are being called for.”

An Army Who Wants To Work With You

3. Followership Capital: Between the network of relationships she built as head of HR, and the reputation she earned for getting things done—on time, fairly, and with visible commitment to the greater good of Xerox–Anne Mulcahy was creating a platform for more strategic responsibility. Organizational loyalty began to form behind her.

“I always had the idea that to be a leader you had to build up an army of people who wanted to work with you—be in your court, as opposed to just watching from afar, hoping you’ll fail. I learned the lesson first in Sales, but the global nature of HR was a much bigger opportunity to create that. As head of HR, I was changing our company values for the better—exciting our people who were so ready to perform and save Xerox. When the Board was looking for an internal CEO candidate in 2000, I represented the culture that people wanted a new leader to stand for.”

From The “What” To The “How”

Throughout our conversation, I continued to ask Anne not just what she had accomplished as head of HR, and why it mattered for her later leadership—but also how she did what she did. She answered simply but consistently: “There was no magic beyond setting high expectations with people, meeting those, and working to be a good partner. In the end, you succeed in this kind of role if you do it as a line job, not a staff assignment. You have to make a difference to the business and have impact, not just fill out forms.”

Is A Tour In HR A Must For Every CEO?

There’s growing recognition today that HR experience can indeed be helpful to any senior leader’s growth. Major companies (Nestle, Zurich Insurance, Philip Morris) now deliberately rotate senior talent through HR as part of their corporate talent development; and other CEOs with that experience are more frequently appearing on the global stage (e.g. Mary Barra, former CHRO and now CEO of GM).

I then asked Anne the obvious next question: “So should every would-be CEO do a stint in their company’s people department?”

Her reply, at first surprising, was eminently sensible. “It can certainly be helpful, and we certainly have to get away from thinking of HR as a dead-end: but I don’t think actually running that function is a necessary step for every leader.”

“What we do have to do is start emphasizing leaders who demonstrate good ‘human resource thinking’—not functional skills so much as good ‘human resources capability’—respecting people, treating them well, motivating them. And as a leader you have to want to have that capability and orientation, and do whatever you can to learn it. You don’t have to do sales to understand customers; you don’t have to do HR to understand respect for people. But both kinds of skills and knowledge are critical for any CEO to develop, to be successful today.”

Looking Ahead

I closed our conversation with one more question: “What about the future?”

She spoke with the confidence of someone who had learned much in the crucible of practice.

“A great HR sensibility and skillset are going to be even more critical tomorrow. Successful businesses always have to create some strategic differentiation. It’s becoming harder and harder to distinguish yourself in product, technology, or process. So much of the opportunity in the future—even more than today–will be based on the caliber of people. If you aspire to senior leadership—or any leadership—you’re going to have to get really good at developing that. Whether you do it as an actual functional HR leader or a virtual one, it’s got to become part of your skillset.”

Originally published on Forbes.com