Metrics

By Guy Higgins

I came across an interesting reference recently – Goodhart’s Law. Charles Goodhart observed, “Any observed statistical regularity will tend to collapse once pressure is placed upon it for control purposes.” I think that’s a pretty good statement, but the phrasing that I saw elsewhere that started me thinking about it was, “When a measure becomes a target, it ceases to be a good measure.” Both phrasings mean the same thing – data can only tell you something important when the data are not managed or controlled. Continue reading

Leadership in the Spotlight

By Guy Higgins

It is extremely important for leaders to recognize that they possess real power. That power surrounds them like an aura and can have two very bad effects. It can adversely affect the leader and it can adversely affect the leader’s subordinates and even people outside the power structure. The news has been filled with stories about men harassing and abusing (and perhaps worse) women. While the women were the primary victims, these men were also abusing their power and the people who gave them, explicitly or implicitly, that power. I want to explore those two adverse effects of power. I want to start with a short look at a classic case of power abuse in history, as captured by Jean Anouilh in the play Becket. Henry II of England was in a struggle with the Roman Catholic Church regarding legal authority over clergy in civil law matters. In what Henry probably thought was a stroke of genius, he had his close friend Thomas Becket named Archbishop of Canterbury. When Becket was elevated to that position, instead of supporting Henry’s claim to authority over clergy, Becket took the Church’s position and opposed his former friend. In the play, Henry II wails, “Will no one rid me of this meddlesome priest?” Several of his knights, upon hearing this complaint, ride off to Canterbury and promptly “rid” the king of Becket by murdering him in the cathedral. So, was this abuse of power the result of Henry’s intentional, if indirect, command to kill the Archbishop or was it the result of his knights’ misunderstanding a frustrated (and powerful) king’s complaint? Continue reading

Developing Leaders

By Guy Higgins

In the US Navy, every sailor has a rating and a rate while every officer has a warfare specialty (Surface Warfare, Aviation, etc.) and a rank. (I’m much less familiar with the processes in the other armed services, so I will restrict my discussion to the Navy, although the other services have analogous approaches.) Ratings and warfare specialties categorize the person’s “technical expertise” – what they do, as an individual, to contribute to mission accomplishment. Rates and ranks reflect the leadership experience and capabilities of the individual. Every sailor and every officer is expected to continually develop both their individual expertise and their leadership skills throughout their careers – in fact, proficiency in both areas is essential for promotion. That development includes both “book learnin’” and hands-on experience.

My experience in industry is significantly different. As a “guest lecturer” presenting in a one-week course for first-time managers at a Fortune-50 leadership center (this company, like GE and some other corporations, believes in providing their managers with formal education in leadership and management), I was talking to a small group of the class members and one new manager said, “In twenty years with this company, this is the first time anyone has ever talked to me about management.” I suspect that the practice of not investing in educating “individual contributors” (employees who are not in a management or leadership position) is common in industry. Management and leadership development tends to be provided after a person is selected for a management position (sort of “Just a Bit Too Late” as opposed to “Just in Time”). There is a cost associated with developing management and leadership skills in every employee the way that the Navy does. Industry is driven by finances – companies must make a profit and the profit must be competitive in their industry if they want to draw investors. I get it. But there is a cost/benefit relationship to be considered, and I have not seen anything even remotely like a cost/benefit analysis for investing in management and leadership development for every employee.

Should industry invest in formal management/leadership development when only ten to twenty percent of employees will ever need it? I think that they should. In fact, I think that industry should make that investment even when an employee expresses no desire or intent to ever be a manager or leader. That takes me to benefits (and I’ll come back to costs later in this post). The benefits of investing in management/leadership development for all employees include:

  • The more each employee knows and understands about corporate leadership and leadership in general, the skills required, the responsibilities, and the pressures, the more likely it is that they will improve their “followership” skills. This isn’t easily measureable, but it could be a significant productivity enhancement.
  • As the industry moves more and more in the direction of a knowledge economy, management and leadership skills will be increasingly important as nearly every employee will, at least on occasion be called on to manage some resources and/or exercise some degree of leadership of temporary or even ad hoc teams.
  • As “gig-economy” behavior becomes more and more common and companies draw on niche expertise from outside the company for short-term contributions to a project or program, full-time employees who have developed management and leadership skills can and will provide the flexibility to lead niche providers.
  • Employees who have expressed no interest in becoming a leader or manager may change their perspective as they gain experience, and investing early in developing those skills will pay off as new managers/leaders can exercise them immediately on promotion.
  • Investing in developing leadership and management skills for all employees sends a significant signal that the company values their employees and the careers options available to those employees. This can also contribute to employee engagement.
  • In contrast to “Just-a-Bit-Late” education, company leadership will not be compelled to accept the risk that an employee, newly promoted to management, will make an expensive error from lack of knowledge or experience.

What about costs? Good question. Let’s look at costs that will include, but not necessarily be limited to:

  • Developing the curricula for both blue-collar and white-collar jobs
    • The “book learnin’” portion of the curricula
    • The practical experience
  • Monitoring individuals’ actual progress through the curricula
  • Establishing policies regarding professional advancement/promotion
  • Enforcing advancement/promotion policies
  • Developing policies and procedures for blending “outside hires” smoothly into the organization (something that the Navy has not done since WW II but which it is now considering for certain highly technical specialties)
  • Providing overhead funding to pay for the “book learnin’” portion of the curricula (the hands-on experience should, as in the Navy, be reaped as part of the direct-cost work done by each employee)
  • The time spent by organizational managers/leaders to mentor their subordinate managers/leaders/employees and provide them with routine and timely feedback (something they should be doing in any event)

Those costs are not trivial and could be as much as 40 hours per employee per year for the formal education component of the curricula (although each individual company can establish what that annual allocation would be – the lower the annual allocation, the longer it takes for an employee to develop useful knowledge and skills).

Do these benefits offset the costs? I can cite some anecdotes, but I have no actual data, so I want to consider this from a probability perspective – I’m not going to go into the messy specifics of the probability calculations – and I’ll look at two scenarios in which a new manager or leader can, through lack of management/leadership skills or knowledge, make errors that cost the company money.

  • A new manager can make leadership errors that make an employee dissatisfied with the company or increase an employee’s dissatisfaction, leading to that employee’s leaving the company. According to Chron.com, the cost to replace an employee can run from 150% of salary to 250% of salary (that’s the admin costs in addition to whatever the new employee will be paid). This is likely to be a relatively common problem and could easily see six figure errors occur more than once a year – even in comparatively small companies.
  • A new manager or leader can make a serious mistake that leads to a crisis. Examples might include any of the following (and many others):
    • Authorizing a direct report’s use of a company social media account which could allow the direct report to make highly embarrassing and costly posts (this occurred in the case of a major appliance manufacturer)
    • A failure to emphasize safety procedures leading to an accident involving multiple failures (the chemical disaster in Bhopal India)
    • A failure to accurately report the inadequacy of allocated resources (this can, obviously apply to any leader or manager, but a new manager or leader is more likely to feel pressure to perform – particularly if they’ve had zero prior experiences or formal education in the ethics of leadership) resulting in the waste of significant company resources.
    • A failure to recognize the importance of strict enforcement of company policies regarding sexual harassment (since that’s a topic in the news now) leading to the new manager minimizing an incident involving one of his subordinates and then finding it on the nightly news the next day.
    • A new manager could authorize his team to access the Internet through a non-corporate ISP (say from home) and open the company up to loss of IP worth a significant fraction of company earnings. For folks who think that no one would do that, it’s important to understand that two thirds of all hacker penetrations into organizational networks are the result of employee errors (appallingly, over half of all people who get phishing emails at work open them and two thirds of those click on the attached link).

Will any of these happen if all employees aren’t provided with leadership/management development education and training? Perhaps not, but the cost of any one of these major incidents could easily dwarf the cost of the development training for several years. While lesser incidents have lower costs, they are more likely. A crippling incident may rarely occur, but the costs could be devastating while the lesser incidents have lower individual costs, but occur more frequently.

Is it reasonable to train all employees in management/leadership? That question is identical to, “Is it reasonable to carry insurance for the company?” It’s a leadership decision to purchase insurance and it’s a leadership decision to invest or not invest in developing management and leadership skills in company employees. I think that companies would benefit from educating all employees in management and leadership.

Thoughts?

Obstacles or Challenges?

By Guy Higgins

I recently read an article, Psychology’s Power Tools. The article addresses the use of cognitive behavioral therapy to help people deal with very difficult personal situations. The author of the article made the point that part of achieving success in helping people in those situations is “reframing” the situation (“reframing” is a way of viewing events, ideas or concepts to find a more positive alternatives or perspectives) and that, I think, applies to leadership. Continue reading

Leadership or Management

By Guy Higgins

My last post (about Elon Musk’s communication memo/email to Tesla employees) included a short comment about Mr. Musk’s use of “manager” and my preference for “leader.” I want to explore that more this week.

To provide some clarity in “communicating,” I want to start with my definitions of leadership and management:

  • Leadership is people-focused. The goal of leadership is to create and maintain an organization/team/company/whatever that can and does perform optimally (and I use that word intentionally) along numerous “dimensions” (such as employee morale, resource allocation, efficiency). Leadership is a skill. There are natural and learned components to it – just as there are to any skill. Some people have personalities and temperaments that contribute more to successful leadership while other peoples’ personalities and temperaments contribute less. People at both extremes can improve their leadership through education, coaching/mentoring and practice.
  • Management is resource-focused. Those resources can include people, but (I will boldly assert) people are only one resource among others. The goal of management is the efficient (and effective) allocation of resources in achieving goals. Metrics and monitoring are crucial to management.

Continue reading

Communication and Power

By Guy Higgins

I recently read an article about an email with the subject, “Communication within Tesla” from Elon Musk to the entire workforce at Tesla. I found the email interesting, but also dangerous – dangerous for Tesla. Mr. Musk’s email is, apparently, aimed at eliminating communication bottlenecks (a good thing) by specifically authorizing, “Anyone at Tesla can and should email/talk to anyone else according to what they think is the fastest way to solve a problem for the benefit of the whole company. You can talk to your manager’s manager without his permission, you can talk directly to a VP in another dept, you can talk to me, you can talk to anyone without anyone else’s permission.” Continue reading

What is a Leader’s Job?

By Guy Higgins

I just read a McKinsey post (I just happen to have subscribed to McKinsey – not that I think that they are any better or worse than any of the other big box consulting firms), Wellness at work: The promise and pitfalls. The post captures the thoughts of a number of leaders from various organizations about wellness at work. As you might expect, the thoughts cover a really broad range of ideas, expectations, and cogitation. As I read the post, I couldn’t help but think that, in my mind, every one of the ideas, expectations and all the cogitation revolved around good leadership. Continue reading

Rebutting False Information

By Guy Higgins

A recent online post from the Association for Psychological Science delivered, I think, a critical message for organizational leaders. You can read that post here. The gist of the post is that you can’t overcome false or fake information simply by denying it. You need to counter-argue it credibly and in detail.

I think that almost everyone has seen cases of people holding on to beliefs based on erroneous, false or outright fake information. The people holding those beliefs are, in the main, not stupid people, but they are people who have all the human tendencies and biases. Overcoming those tendencies and biases is hard and requires some hard work and intelligent planning. It cannot be done ad hoc. Continue reading

Workplace Diversity

By Guy Higgins

I recently came across two articles. The first, Yes, your kid will do something with that philosophy degree after all, was a newspaper column that addressed the potential power of a classic liberal arts education. The second was condensed from McKinsey’s report on Women in the Workplace 2017 and looked at how women are faring in corporate careers. Continue reading

The Smartest Guy in the Room?

By Guy Higgins

I came across an article recently, What Know-it-alls Don’t Know, or the Illusion of Competence. The article captures the results of some psychological studies that yielded what the psychologists today call The Dunning-Kruger Effect. The Dunning-Kruger Effect is the cognitive bias of inflating a self-assessment, also known as the “illusion of competence.” One of the things I found interesting is that the bias is most pronounced among those people who are, in reality, the least competent. For example, eighty percent of all drivers believe that they are better than average drivers – with those people with the worst driving records being the most certain of their superior skills. Even more remarkable is how highly college athletes rate their professional potential. Forty to sixty percent (at least some of whom – by definition – are below-average college players) of NCAA athletes (men and women – for all those ladies who were nodding about how vain the male athletes are) believe that they are at least “somewhat likely” to play professionally. The actual percentages hover around one percent. Continue reading