Category: Team

Book review: “Who – The A method for hiring” by Geoff Smart and Randy Street

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Almost everyone I speak to complains about how hard it is to hire good product people. We talk about the low return on investment of lengthy interview processes and those product hires that “didn’t work out”. I’ve written about hiring product managers previously and shared my lessons learned about recruiting good product people. Who – The A method for hiring, published back in 2008 by Geoff Smart and Randy Street has been a very welcome addition to my learnings about hiring:

  1. It’s about “who” not about “what” – In the book, “who” refers to the people you put in place to make the “what” decisions. Who’s running your sales force? Who manages your product? Who engages with your customers? In the book, Smart and Street stress the importance of making the right hiring decisions, and how as a manager your success is largely determined by the quality of the people around you.
  2. When ‘who’ mistakes happen – Smart and Street list a number of instances where “who” mistakes happen; when managers end up hiring the wrong person for the job. They also talk about “voodoo hiring” (see Fig. 1-2 below). Their book aims to help people make better “who” decisions, and provides a proven method, dubbed the “A method” to help readers on their way.
  3. The limited value of CVs – There’s only so much candidate CVs will tell you as a hiring manager. In my experience, a CV can be a useful snapshot but often not more than that. Smart and Street describe a CV as “a record of a person’s career with all of the accomplishments embellished and all the failures removed.”
  4. Finding A players – Smart and Street define an A player as “a candidate who has at least a 90 percent chance of achieving a set of outcomes that only the top 10 percent of possible candidates could achieve.” To help find A Players, Smart and Street and their colleagues at ghSMART have developed the “A Method for Hiring” or the “A Method” for short. There are four steps to the A Method: (1) Scorecard (2) Source (3) Select and (4) Sell (see Fig. 3 below). Naturally, the hiring manager needs to feel confident about having A Players around him or her, which might not always be the case. Equally, I’d argue that it pays off to look for good B (and perhaps even C) players too. These candidates might not have achieved their A game yet, but still stand 70 percent chance of achieving key outcomes (and can learn as they go).
  5. Scorecard – The idea of having a predetermined scorecard for each role is a valuable one, since a scorecard describes the mission for the position, outcomes that must be accomplished, and competencies that fit with both the culture of the company and the role. What do you really want the person that you’re hiring to accomplish, and why? What’s the phase that your company is in, and which the person you’re hiring needs to adapt to? The scorecard consists of three parts: (1) the job’s mission (2) outcomes and (3) competencies (see Fig. 4 below).
  6. Source – The idea of sourcing is all about constantly looking for talented people, irrespective of whether your company has an imminent hiring need. As some of the people interviewed for the book explain, ‘source’ is all about constantly asking people we know to introduce us to the talented people they know and maintaining a relationship with high-potential candidates (see Fig. 6 below). You thus build up talent pool which you can use as your first port of call when hiring, thus increasing the overall velocity of your hiring process.
  7. Select – The ‘select’ element of the A Method comes down to interviewing well. Smart and Street recommend doing structured interviews in order to avoid what they call ‘voodoo hiring methods’ (see Fig. 2 below). They suggest the following steps for selecting the right candidate:  (1) Screening Interview (2) Who Interview (3) Focused Interview (4) Reference and (5) Skill-Will Bull’s-Eye (see Fig. 7 below).
  8. Sell – In their book, Smart and Street stress the importance of putting yourself in the candidate’s shoes as the key to successful selling your candidate to join your company. Care about what they care about. The book explains how candidates typically care about five things, and encourage you to make sure that you address each of these five areas until you get the person to sign on the dotted line (see Fig. 12 below). Selling doesn’t happen just at the end of the process. Instead, you ‘sell’ throughout: When you source; When you interview; The time between your offer and the candidate’s acceptance; The time between the candidate’s acceptance and his or her first day and The new hire’s first one hundred days on the job.

Main learning point: Hiring good people is easier said than done in my experience. “Who – The A Method for hiring”, however, does a great job in offering every hiring manager with key considerations to make and techniques to apply when look for  new people.

 

Fig. 1 – When ‘who’ mistakes happen – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

Who mistakes happen when managers:

  • Are unclear about what’s needed in a job;
  • Have a weak flow of candidates;
  • Do not trust their ability to pick out the right candidate from a group of similar-looking candidates;
  • Lose candidates they really want to join their team.

Fig. 2 – Voodoo Hiring – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

Top ten voodoo hiring methods:

  1. The Art Critic – Hiring people based on gut instinct.
  2. The Sponge – A common approach among busy managers is to let everybody interview a candidate, with the risk of interviewers asking candidates exactly the same questions.
  3. The Prosecutor – Many managers act like the prosecutors they see on TV and aggressively question candidates, attempting to trip them up with trick questions and logic problems.
  4. The Suitor – Rather than rigorously interviewing a candidate, some managers spend all of their energy selling the applicant on the opportunity. Suitors are more concerned with impressing than assessing their capabilities.
  5. The Trickster – Then there are the interviewers who use gimmicks to test for certain behaviours. They might throw a wad of paper on the floor, for example, to see if a candidate is willing to clean it up.
  6. The Animal Lover – Many managers hold on stubbornly to their favourite pet questions – questions they think will reveal something uniquely important about a candidate.
  7. The Chatterbox – This technique has a lot in common with the “la-di-da” interview. The conversation usually goes something like this: “How about them Yankees! Man, the weather is rough this time of year. You grew up in California? So did I!”
  8. The Psychological and Personality Tester – Asking a candidate a series of bubble-test questions like “Do you tease small animals?” or “Would you rather be at a cocktail part or the library on a Friday night?” is not useful (although both are actual questions on popular psychology tests), and it’s certainly not predictive of success on the job.
  9. The Aptitude Tester – Tests can help managers determine whether has the right aptitude for a specific role, such as persistence for a business development position, bit they should never become the sole determinant in a hiring decision.
  10. The Fortune-Teller – Just like a fortune-teller looking in a crystal ball to predict the future, some interviewers like into the future regarding the job at hand by asking hypothetical questions: “What would you do? How would you do it? Could you do it?”

Fig. 3 – “The ghSMART A Method for Hiring” – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

 

  • Scorecard – The scorecard is a document that describes exactly what you want a person to accomplish in a role. It is not a job description, but rather a set of outcomes and competencies that define a job well.
  • Source – Finding great people is getting harder, but it is not impossible. Systematic sourcing before you have slots to fill ensures you have high quality candidates waiting when you need them.
  • Select – Select talent in the A Method involves a series of structured interviews that allow you to gather the relevant facts about a person so you can rate your scorecard and make an informed hiring decision. These structured interviews break the voodoo hiring spell.
  • Sell – Once you identify people you want on your team through selection, you need to persuade them to join. Selling the right away ensures you avoid the biggest pitfalls that cause the very people you want the most to take their talents elsewhere.

Fig. 4 – The three parts of the A Method scorecard – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

  • The mission – The mission is an executive summary of the job’s core purpose. It boils the job down to its essence so everybody understands why you need to hire someone into the slot. You’ll know you have a good mission when candidates, recruiters, and even others from your team understand what you are looking for without having to ask clarifying questions. A good mission statement could for instance read: “To serve as a visionary leader who helps the bank capture market share from the competition by analysing the market and devising successful new strategies and product offerings.” Mission statements also help you avoid one of the most common hiring traps: hiring a generalist over a specialist.
  • Outcomes – Outcomes, the second part of a scorecard, describe what a person needs to accomplish in a role. If you are hiring for a sales person for instance, the scorecard should read” “Grow revenue from $25 million to $50 million by end of year three.” This is a clearly defined outcome which a sales person either can or can’t achieve. An outcome is something which a person must get done.
  • Competencies – Competencies flow directly from the first two elements of the scorecard. The mission defines the essence of the job to a high degree of specificity. Outcomes describe what must be accomplished. Competencies describe how you expect a new hire to operate in the fulfilment of the job and the achievement of the outcomes. The book lists some critical competencies for A Players (see Fig. 5 below).

Fig. 5 – Critical competencies for A Players – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

  • Efficiency – Able to produce significant output with minimal wasted effort.
  • Honesty / integrity – Does not cut corners ethically. Earns trust and maintains confidences.
  • Organisation and planning – Plans, organises, schedules, an budgets in an efficient, productive manner. Focuses on key priorities.
  • Aggressiveness – Moves quickly and takes a forceful stand without being overly abrasive.
  • Follow-through on commitments – Lives up to verbal and written agreements, regardless of personal cost.
  • Intelligence – Learns quickly. Demonstrates ability to quickly and proficiently understand and absorb new information.
  • Analytical skills – Able to structure and and process qualitative and quantitative data and draw insightful conclusions from it. Exhibits a probing mind and achieves penetrating insights.
  • Attention to detail – Does not let important details slip through the cracks or derail a project.
  • Persistence – Demonstrates tenacity and willingness to go the distance to get something done.
  • Proactivity – Acts without being told what to do. Brings new ideas to the company.
  • Ability to hire A Players (for managers) – Sources, selects and sells A Players to join a company.
  • Ability to develop people (for managers) – Coaches people in their current roles to improve performance, and prepares them for future roles.
  • Flexibility / adaptability – Adjusts quickly to changing priorities and conditions. Copes effectively with complexity and change.
  • Calm under pressure – Maintains stable performance when under heavy pressure or stress.
  • Strategic thinking / visioning – Able to see and communicate the big picture in an inspiring way. Determines opportunities and threats through comprehensive analysis of current and future trends.
  • Creativity / innovation – Generates new and innovative approaches to problems.
  • Enthusiasm – Exhibits passion and excitement over work. Has a can-do attitude.
  • Work ethic – Possesses a strong willingness to work hard and sometimes long hours to get the job done. Has track record of working hard.
  • High standards – Expects personal performance and team performance to be nothing short of the best.
  • Listening skills – Lets others speak and seeks to understand their viewpoints.
  • Openness to criticism and ideas – Often solicits feedback and reacts calmly to criticism or negative feedback.
  • Communication – Speaks and writes clearly and articulately without being overly verbose or talkative.
  • Teamwork – Reaches out to peers and cooperates with supervisors to establish and overall collaborative working relationship.
  • Persuasion – Able to convince others to pursue a course of action.

Fig. 6 – How to source – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

  1. Referrals from your professional and personal networks.
  2. Referrals from your employee
  3. Deputising friends of the firm
  4. Hiring recruiters
  5. Hiring researchers
  6. Sourcing systems

Fig. 7 – Select: interview steps – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

  1. Screening Interview – The screening interview is a short, phone-based interview designed to clear out B and C Players from your roster of candidates. In the screening questions you can ask some of the following questions: What are your career goals? What are you really good at professionally? What are you not good at or interested in doing professionally? Who were your last five bosses, and how will they each rate your performance on a 1-10 scale when we talk to them? The whole point of the screening interview is to weed people out as quickly as possible.
  2. Who Interview – The Who Interview is designed to give you more confidence in your selection because it uncovers the patterns of somebody’s career history, which you can match to your scorecard (see Fig. 8 below for a sample Who Interview Guide). The Who Interview is a chronological walkthrough of a person’s career.
  3. Focused Interview – The Who Interview is comprehensive and will get you most of the way toward the right answer of who to hire. In the Focus Interview, you can gather additional, specific information about your candidate. In essence, you’re turning the magnification up another notch so you can give would-be hires one last look with a finer degree of granularity (see a sample Focused Interview Guide in Fig. 10 below).
  4. Reference Interview – There are three things you have to do to have successful reference interviews. First, pick the right references. Second, ask the candidate to contact the references to set up the calls. Third, conduct the right number of interviews; you personally do about four and ask your colleagues to do three, for a total of seven reference interviews (see sample Reference Interview Guide in Fig. 11 below).
  5. Skill-Will Bull’s-Eye – The goal of the “Select” step of the A Method is to gather the facts you need to decide if somebody’s skill (what they can do) and will (what they want to do) match your scorecard. This is a person’s skill-will profile. When a candidate’s skill-will profile matches up perfectly with the requirements outlined on your scorecard, your candidate hits the the skill-will bull’s-eye.

Fig. 8 – Who Interview Guide – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

  1. What were you hired to do?
  2. What accomplishments are you most proud of?
  3. What were some low points during that job?
  4. Who were the people you worked with?
  5. Why did you leave that job?

Fig. 9 – ‘Master Tactics’ for the ‘Who Interview’ – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

  • Interrupting – You have to interrupt the candidate. If you don’t, he or she might talk for then hours straight about things that are not at all relevant. The bad way to interrupt somebody is to put up your hand like a stop sign gesture and say, “Wait, wait, wait. Let me stop you there. Can we get back on track?” The good way to interrupt somebody is to smile broadly, match their enthusiasm level, and use reflective listening to get them to stop talking without demoralising them.
  • The Three P’s – The three P’s are questions you can use to clarify how valuable an accomplishment was in any context. The questions are: (1) How did your performance compare to the previous year’s performance? (2) How did your performance compare to the plan? (3) How did your performance compare to that of peers?
  • Push Versus Pull – People who perform well are generally pulled to greater opportunities. People who perform poorly are often pushed out of their jobs. Do not hire anybody who has been pushed out of 20 percent or more of their jobs. Push: “It was mutual.” “It was time for me to leave.” “My role shrank.” Etc. Pull: “My biggest client hired me.” “My old boss recruited me to a bigger job.” “The CEO asked me to take a double promotion.” Etc.
  • Painting a Picture – This is all about empathic imagination, which helps you move away from generic answers that don’t mean anything and toward specific details that give you real insight. You’re really trying to put yourself in the candidate’s shoes and get curious to truly understand.
  • Stopping at the Stop Signs – One of the advantages of the Who Interview in person is that you can watch for shifts in body language and other inconsistencies. The idea isn’t to gather dirt. Think of yourself instead as a biographer interviewing a subject. You want both the details and the broad pattern, the facts and the texture.

Fig. 10 – Who Interview Guide – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

  1. The purpose of this interview is to talk about _______________ (Fill in the blank with specific outcome or competency such as the person’s experience selling to new customers, building and leading a team, creating strategic plans, etc).
  2. What are your biggest accomplishments in this area during your career?
  3. What are your insights into your biggest mistakes and lessons learned in this area?

Fig. 11 – Reference Interview Guide – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

  1. In what context did you work with the person?
  2. What were the person’s biggest strengths?
  3. What were the person’s biggest areas for improvement back then?
  4. How would you rate his/her overall performance in that job on a 1-10 scale? What about his or her performance causes you to give that rating?
  5. The person mentioned that he/she struggled with ________________ in that job. Can you tell me more about that?

Fig. 12 – Five Things Candidates Care About – Taken from: Geoff Smart and Randy Street, “Who – The A method for hiring”:

  • Fit ties together the company’s vision, needs, and culture with the candidate’s goals, strengths, and values. “Here is where we are going as a company. Here is how you fit in?”
  • Family takes into account the broader trauma of changing jobs. “What can we do to make this change as easy as possible for your family?”
  • Freedom is the autonomy the candidate will have to make his or her own decisions. “I will give you ample freedom to make decisions, and I will not micromanage you.”
  • Fortune reflects the stability of your company and the overall financial upside. “If you accomplish your objectives, you will likely make [compensation amount] over the next five years.”
  • Fun describes the work environment and personal relationships the candidate will make. “We like to have a lot of fun around here. I think you will find this is a culture you will really enjoy.”

Book review: The Making of a Manager by Julie Zhuo

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“The Making of a Manager” is the first book by Julie Zhuo, VP of Product Design at Facebook. In “The Making of a Manager”, Julie shares her experiences and learnings with regard to her transition from being a personal contributor to becoming a manager. “This is a book about how someone with no formal training learned to become a confident manager” is the starting point for Julie’s book.

When she started her first role as a manager at Facebook, Julie had very little experience under her belt and she describes what she thought a manager’s job was:

  • have meetings with reports to help them solve their problems,
  • share feedback about what is or isn’t going well, and
  • figure out who should be promoted and who should be fired.

Without wanting to spoil the rest of “The Making of a Manager”, this is how Julie sees a manager’s job today:

  • build a team that works well together,
  • support members in reaching their career goals, and
  • create processes to get work done smoothly and efficiently.

Julie summarises that “Your job, as a manager, is to get better outcomes from a group of people working together.” She puts a great focus on outcomes and refers to her former manager Chris Cox, ex VP of Product at Facebook, who explained that half of what he as a manager looks at were his team’s results and the other half was based on the strength and satisfaction of his team.

I liked Julie’s inclusion of Richard J. Hackman’s research into what helps create successful teams (see Fig. 1 below). She uses a similar approach to managers creating the right conditions for their teams:

  • Purpose – The purpose is the outcome your team is trying to accomplish, otherwise known as the why. The first big part of your job as a manager, Julie writes, is to ensure that your team knows what success looks like and cares about achieving it.
  • People – This is all about the who. Are the members of your team set up to succeed? Do they have the right skills? Are they motivated to do great work? To manage people well, Julie explains, you must develop trusting relationships with them, understand their strengths and weaknesses (as well as your own – see below), make good decisions about who should do what (including hiring and firing when necessary), and coach individuals to do their best.
  • Process – This describes how your team works together. Julie clarifies that process in her mind isn’t about stacks of paperwork and frameworks for everything, but enabling teams to make decisions and work together effectively: “In a team setting, it’s impossible for a group of people to coordinate what needs to get done without spending time on it. The larger the team, the more time is needed.”

Staying on the topic of defining management, Julie provides a useful distinction between leadership and management. Manager is a specific role, with clear principles outlining what a manager does and how his success is measured. Leadership, on the other hand, is the particular skill of being able to guide and influence other people. Julie makes the point that a leader doesn’t have to be a manager; “Anyone can exhibit leadership, regardless of their role.”

In “The Making of a Manager”, Julie covers a lot of different facets of becoming and being a manager. From recounts her first couple of months as a manager to breaking down her views on strong management, Julie offers a ton of insights and tips for those of us who are managers or would like to take on this role. Let’s pick some aspects that resonated with me most:

  • Trust is the most important ingredient – It may sound obvious, but the importance of investing time and effort into creating / maintaining trusting relationships can get easily overlooked. Julie mentions that the hallmark of a trusting relationship is that people feel they can share their mistakes, challenges, and fears with you.
  • Giving and receiving critical feedback – Similar to Kim Scott and Amy Edmondson, Julie talks about how managers and their direct reports need to be able to give each other critical feedback regularly without it being taken personally. If your report does work that you don’t think is great, are you comfortable saying that directly? Similarly, would your report tell you if you if he thinks you’ve made a mistake?
  • Be honest and transparent about your report’s performance – As a manager, your perspective on how your report is doing carries far more weight than his perspective on how you’re doing. After all, you’re the one who determines what he works on and whether he should get a promotion or be fired.
  • Admit your own mistakes and growth areas – Julie shares how she tries to admit when she doesn’t have the answers or when she’s working through her own personal challenges, and shares a number of useful phrases that she’ll typically use when doing so (see Fig. 2 below).
  • Managing yourself – Here, Julie talks about the so-called imposter syndrome, i.e. where you doubt your accomplishments and worry being exposed as a “fraud”.  She raises the question why imposter syndrome hits managers particularly hard and gives two main reasons. Firstly, because managers are often looked to for answers. Secondly, managers are constantly put in the position where they’re put in the position if doing things they haven’t done before. She also talks about managers identifying their own strengths and weaknesses, and “being brutally honest with yourself”.
  • Amazing meetings – I liked Julie’s points about meetings, the bane of most managers’ lives. She distinguishes between decision-making meetings and informational meetings and explains how being clear about the meeting objective (and structuring the meeting accordingly) can lead to much more effective and enjoyable meetings (see Fig. 3 below).

Fig. 1 – Richard J. Hackman, Hackman’s 5 Factor Model:

Being a Real Team – One with clear boundaries and stable membership.

Compelling Direction – Provide the team with clear goals, which are both challenging and consequential.

Enabling Structure – Where possible, offering the team variety in the tasks they undertake improves the team’s success. Within the team’s structure it’s also key to ensure that team members have strong social skills.

Supportive Context – A supportive context is essential for companies and organisations, as they are made up of small groups which when combined form a larger group.

Expert Coaching – This is about coaching and mentoring the team to help achieve the outcomes they need to achieve and support team members developing their individual skills.

 

Fig. 2 – Julie Zhou, The Making of a Manager: Sample things to say when you don’t have the answer or are working through personal challenges:

  • “I don’t know the answer. What do you think?”
  • “I want to come clean and apologise for what I did/said the other day …”
  • “One of my personal growth areas this half is …”
  • “I’m afraid I don’t know enough to help you with that problem. Here’s someone you should talk to instead …”

 

Fig. 3 – Julie Zhou, The Making of a Manager: Decision-Making Meetings and Informational Meetings:

A great decision-making meeting does the following:

  • Gets a decision made (obviously)
  • Includes the people most directly affected by the decision as well as a clearly designated decision-maker.
  • Presents all credible options objectively and with relevant background information, and includes the team’s recommendation if there’s one.
  • Gives equal airtime to dissenting opinions and makes people feel that they were heard.

A great informational meeting does the following:

  • Enables the group to feel like they learned something valuable.
  • Conveys key messages clearly and memorably.
  • Keeps the audience’s attention (through dynamic speakers, rich storytelling, skilled pacing, interactivity).
  • Evokes and intended emotion – whether inspiration, trust, pride, courage, empathy, etc.

Main learning point: “The Making of a Manager” provides an honest, no bullsh*t account of what it means to be manager and how to best transition into a managerial role. Definitely worth a read if you’re manager or looking to become one.

Related links for further learning:

  1. http://www.juliezhuo.com/
  2. https://medium.com/the-year-of-the-looking-glass
  3. https://hbr.org/2009/05/why-teams-dont-work
  4. https://marcabraham.com/2018/03/12/book-review-the-no-asshole-rule/
  5. http://www.free-management-ebooks.com/faqld/development-03.htm
  6. https://www.cnbc.com/2017/01/30/sallie-krawcheck-says-a-lack-of-diversity-leads-to-bad-decision-making.html
  7. https://marcabraham.com/2019/01/27/my-product-management-toolkit-35-effective-one-on-one-meetings/
  8. https://www.youtube.com/watch?v=ZQUxL4Jm1Lo
  9. https://hbr.org/product/becoming-a-manager-how-new-managers-master-the-challenges-of-leadership/1822-PBK-ENG
  10. https://www.tmbc.com/
  11. https://strengthsprofile.com/

 

Book review: “High Output Management” by Andrew Grove

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“High Output Management” by the late Andrew Grove, ex Chairman and CEO of Intel, is a must read management book in my opinion. It’s easy to be quite cynical about most management and business books as a lot of them seem to introduce one central theme (or buzzword) right at the beginning of the book, followed by endless repetition throughout the remainder of the book …

 

 

In contrast, “High Output Management” contains valuable advice and tips from the beginning right to the end of the book. First published back in 1983, the book applies production principles to management. Some of these principles really resonated with me and I feel strongly about all (product) managers benefiting from these principles as part of their day-to-day working practices:

Identifying the “limiting step” – Grove defines the “limiting step” as the step in the overall shape of the production flow that will determine the overall shape of a company’s operations. In the book, Grove uses the simple example of a breakfast company, and highlights the time required to boil an egg is the critical component or the ‘limiting step’ in the production flow (see Fig. 1 below). The key idea here is to construct your production flow by starting with the longest (or most difficult, or most sensitive, or most expensive) step and work our way back. As a (product) manager you’ll thus focus on the limiting step within your context, e.g. in the workflow of your team, the customer funnel or the decision-making process.

 

Fig. 1 – Example of a limiting step when creating a breakfast – Taken from: http://clarkeching.com/ccblog/2018/1/21/what-are-bottlenecks-andy-grove

 

Detect and fix issues at the “lowest-value stage” possible – If there’s a problem with your product, you want to find out about it as early on in the production process as possible so that you can minimise risk. In the production world, I witnessed lowest-value stage thinking first hand at the assembly line of a Toyota factory. Here, employees can pull the   “Andon” cord to (temporarily) bring things to a halt as soon as they come across an issue. It’s an easy way of escalating things, making sure that a problem or bottleneck is dealt with before proceeding with the rest of the assembly process. Think about when you last pulled an imaginary Andon cord to flag a product or team issue early!?

 

Fig. 2 Using the Andon cord to raise an issue and stop production – Taken from: https://www.lean.org/lexicon/fixed-position-stop-system

 

 

Using (leading) indicators to measure and predict – In order to run a production process well you’ll need a set of indicators which help you monitor and improve the efficiency of the production line. Grove stresses that for these indicators to be useful, “you have to focus each indicator on a specific operational goal.” He goes on to list a number of relevant production indicators (see Fig. 3 below). Leading indicators give you one way to look inside the production process by showing you in advance what the future might look like.

 

Fig. 3 – Indicators related to the production process – Taken from: Andrew S. Grove, “High Output Management”, p. 16:

  • Sales forecast
  • Raw material inventory
  • Manpower
  • Quality

 

Leverage – Grove introduces the concept of “leverage”.  This is the output generated by a specific type of work activity. An activity with high leverage will generate a high level of output; an activity with low leverage, a low level of output. This raises the question about what qualifies as managerial leverage and output. Grove’s distinction between activities and output really helps to bring the concept of leverage to life (see Fig. 4 below). The overarching idea is that with each activity that the manager performs, the organisational output should increase.

 

Fig. 4 – Managerial activities vs output – Taken from: Andrew S. Grove, “High Output Management”, pp. 39 – 54:

Managerial activities:

  • Judgments and opinions
  • Direction
  • Allocation of resources
  • Mistakes detected
  • Personnel trained and subordinates developed
  • Courses taught
  • Products planned
  • Commitments negotiated

Managerial output:

A manager’s output is the output of all of the people and the teams that report into her. For example, if someone manages a design team, then his output consists of completed designs that are ready to be implemented.  That output can take many different forms depending on the type of role and industry. Regardless of the form of output, managers must measure its quantity and quality:

A manager’s output = The output of his organisation + The output of the neighbouring organisations under his influence

 

High leverage activities – We’ve already touched on the impact of highly leveraged activities on an organisation’s output, and Grove explains how these activities can be achieved (see Fig. 5 below). For example, to maximise the leverage of his or her activities, a manager must keep timeliness firmly in mind. Equally, managers micro-managing or ‘meddling’ are examples of negative leverage activities. A big part of a manager’s work is to supply information and know-how, and to share a sense of the preferred method of handling things to the teams under his control or influence. A manager also makes and helps to make decisions.

 

Fig. 5 – Three ways in which to achieve high leverage activities – Taken from: Andrew S. Grove, “High Output Management”, pp. 54 – 55:

  • When many people are affected by one manager.
  • When a person’s activity or behaviour over a long period of time is affected by a manager’s, well focused-set of words or actions.
  • When a large group’s work is affected by an individual supplying a unique, key piece of knowledge or information.

 

Applying production principles to management – In the book, Grove rightly points out how time management techniques are commonly used to improve managerial output. He then uses production principles to improve on some of these time management techniques (see Fig. 6 below).

 

Fig. 6 – Ways to improve on time management techniques – Taken from: Andrew S. Grove, “High Output Management”, pp. 62 – 63:

  • Identify our limiting step: determine which things that have to happen on a schedule that’s absolute, and which can’t be moved. You can then plan more flexible activities around it and thus work more efficiently.
  • Batching similar tasks: group similar activities, e.g. performance reviews, as these activities tend to require (mental) set-up time. You can thus maximise the set-up time needed for the task and reduce duplication of effort.
  • Forecasting your activities: Your calendar can be a valuable production-planning tool (and not a dumping ground for random meetings or “orders” by others). If you want to use your calendar as better forecasting and planning tools, Grove suggest that two conditions should be met. Firstly, you should move toward the active use of your calendar, taking the initiative to fill the holes between the time-critical events with non-time critical though necessary activities. Secondly, you should say “no” at the outset to work beyond your capacity to handle.

 

Meetings, the output of managerial work – A lot of managerial tasks (see “High leverage activities” above) are best suited for face-to-face interactions, and more often than not, for meetings. Grove provides a useful distinction between two basic kinds of meetings: process-oriented and mission-oriented meetings (see Fig. 7 below). I love how at the end of the book’s chapter about meetings, Grove reminds us of a quote by the late management guru Peter Drucker who said that “If people spend more than 25 percent of their time in meetings, it’s a sign of malorganisation.”

 

Fig. 7 – Process-oriented and mission-oriented meetings – Taken from: Andrew S. Grove, “High Output Management”, pp. 72 – 87:

  • Process-oriented meetings: Knowledge is shared and information is exchanged during process-oriented meetings, which take place on a regular, scheduled basis. One-on-ones and team meetings are good examples of process-oriented meetings.
  • Mission-oriented meetings: The purpose of mission-oriented meetings is to solve a specific problem and often produce a decision. These meetings are ad hoc affairs, not scheduled long in advance, because they usually can’t be. The key to the success of a mission-oriented meeting is what the chair of the meeting does. The person leading the meeting needs to have a clear understanding of the meeting’s objective – what needs to happen and what decision needs to be made.

 

 

Planning: today’s actions for tomorrow’s output – In High Output Management, Grove offers three simple steps of a  planning process (see Fig. 8 below). He describes planning as an ordinary everyday activity, something we all do – both in our professional and personal lives. The planning process enables you to reflect on what’s needed, the gap with the current situation and the specific actions necessary to close the gap.

 

Fig. 8 – Three steps your planning process should consist of – Taken from: Andrew S. Grove, “High Output Management”, pp. 103 – 120:

Step 1 – Establish projected need or demand: What will the environment demand from you, your business, or your organisation?

Step 2 – Established your present status: What are you producing now? What will you be producing as your projects in the pipeline are completed? 

Step 3 – Compare and reconcile steps 1 and 2: What more (or less) do you need to do to produce what your environment will demand?

 

Main learning point: “High Output Management” is probably one of the most valuable management books I’ve read in the last couple of years. If you’re looking for an inspiring but practical book about management, I suggest you look no further: High Output Management is the book for you!

Book review: “The Fearless Organization” by Amy C. Edmondson

marcabraham1 Comment

Before you read this review of “The Fearless Organization” by Amy Edmondson, I’d encourage you to watch Amy’s Tedx Talk in which she talks about how to build psychological safety. Edmondson is a management professor at Harvard Business School and has done a tremendous amount of work in the area of psychological safety.  In her Tedx Talk, she describes psychological  safety as “a shared belief that the team is safe for interpersonal risk taking.” I believe that psychological safety is a critical yet often overlooked concept, and one which underpins Edmondson’s latest book, The Fearless Organization – Creating Psychological Safety in the Workplace for Learning, Innovation, and Growth.

 

 

These are the things that I took away from reading The Fearless Organization:

  1. Starting with “Personal and Organizational Change through Group Methods” – The aforementioned concept of psychological safety dates back to a 1965 book titled “Personal and Organizational Change through Group Methods” by Edgar Schein and Warren Bennis, which addresses the need for psychological safety for to help people cope with the uncertainty and anxiety of organizational change. Schein later noted that psychological safety was vital for helping people overcoming the defensiveness and “learning anxiety” they face at work, especially when something doesn’t go as they’d hoped or expected.
  2. Psychological safety isn’t a personality trait or difference – Based on her extensive research, Edmondson observes that psychological safety “is not a personality difference but rather a feature of the workplace that leaders can and must help create.” This observation made me think about the conditions that leaders can and must ‘enable’ to create a culture of psychological safety within the organisation, establishing a climate that supports learning. Edmondson mentions a number of other things which psychological safety is not, and which I’ve captured in Fig. 1 below.
  3. Measuring psychological safety – Perhaps you think of psychological safety as quite a fluffy idea, but it can actually be measured. I like the seven survey items which Edmondson introduced in her original research dissertation and which I’ve included in Fig. 3 below. She uses a seven-point Liker scale to obtain responses (from strongly agree to strongly disagree), and three out of seven items are expressed positively. Agreement with these items indicates greater psychological safety, whilst those items items expressed negatively (highlighted with an “R” for reverse), such that disagreement is consistent with higher psychological safety.
  4. Adopting an agile approach to strategy – I loved Edmondson’s point about viewing a company strategy as a hypothesis, to be tested continuously, rather than a plan. This perspective ties in with Edmondson’s broader theme around organisational learning. She argues that organisational learning – championed by company leaders but enacted by everyone – requires actively seeking deviations that challenge the assumptions underpinning a current strategy.
  5. Set the stage for psychological safety – In the book, Edmondson offers some useful tips with respect to ‘facilitating’ psychological safety, sharing a valuable toolkit (see Fig. 4 below).
  6. Proactive inquiry – Being able to say that you don’t know and driving participation through inquiry are two strong tenets of psychological safety. Edmondson shares some rules of thumb for asking a good question: one, you don’t know the answer; two, you ask questions that don’t limit responses to Yes or No, and three, you phrase the question in a way that helps others share their thinking in a focused way (see also Fig. 5 below).

Main learning point: In “The Fearless Organization”, Edmondson has written a valuable book about psychological safety. Even if you’re unable to create a truly fearless organisation anytime soon, Edmondson offers a number of valuable starting points with respect to critical aspects such as questioning, conflict and speaking up.

 

Fig. 1 – What Psychological Safety Is Not – Taken from: Amy Edmondson, The Fearless Organisation, pp. 15-19

  • Psychological safety isn’t about being nice – Working in a psychologically safe environment doesn’t mean that people always agree with one another for the sake of being nice. It also doesn’t mean that people offer unequivocal praise or unconditional support for everything you have to say. Psychological safety is about candour, about making it possible for productive disagreement and free exchange of ideas. Conflict inevitably arises in any workplace. Psychological safety enables people on different sides of a conflict to speak candidly about what’s bothering them.
  • Psychological safety isn’t a personality factor – Some have interpreted psychological safety as a synonym for extroversion. They might have previously concluded that people don’t speak up at work because they’re shy or lack confidence, or simply keep to themselves. Psychological safety, however, refers to the work climate, and climate affects people with different personality traits in roughly similar ways. In a psychologically safe climate, people will offer ideas and voice their concerns regardless of whether they tend to toward introversion or extroversion.
  • Psychological safety isn’t just another word for trust – Although trust and psychological safety have much in common, they aren’t interchangeable concepts. A key difference is that psychological safety is experienced at a group level. Further, psychological safety describes a temporally immediate experience.
  • Psychological safety isn’t about lowering performance standards – Psychological safety is not an “anything goes” environment where people aren’t expected to adhere to high standards or meet deadlines. It isn’t about becoming “comfortable” at work (see Fig. 2 below). Psychological safety enables candour and openness and, as such, thrives in an environment of mutual respect.

 

Fig. 2 – How psychological safety relates to performance standards – Taken from: Amy Edmondson, The Competitive Imperative of Learning, https://hbr.org/2008/07/the-competitive-imperative-of-learning

 

 

Fig. 3 – A survey measure of psychological safety – Taken from: Amy Edmondson, The Fearless Organisation, p. 20

  1. If you make a mistake on this team, it is often held against you. (R)
  2. Members of this team are able to bring up problems and tough issues.
  3. People on this team sometimes reject others for being different. (R)
  4. It is safe to take a risk on this team.
  5. It is difficult to ask other members of this team for help. (R)
  6. No one on this team would deliberately act in a way that undermines my efforts.
  7. Working with members of this team, my unique skills and talents are valued and utilised.

 

Fig. 4 – The leader’s tool kit for building psychological safety – Taken from: Amy Edmondson, The Fearless Organisation, p. 159 

Setting the stage:

Leadership tasks:

  • Frame the work – Set expectations about failure, and interdependence to clarify the need for voice
  • Emphasise the purpose – Identify what’s at stake, why it matters, and for whom

Accomplishes:

  • Shared expectations and meaning

Inviting participation:

Leadership tasks:

  • Demonstrate situational humility – Acknowledge gaps
  • Practice inquiry – Ask good questions and model intense listening
  • Set up structures and processes – Create forums for input and provide guidelines for discussion

Accomplishes:

  • Confidence that voice is welcome

Responding productively

Leadership tasks:

  • Express appreciation – Listen, acknowledge and thank
  • Destigmatise failure – Look forward, offer help. Discuss, consider and brainstorm next steps
  • Sanction clear violations

Accomplishes:

  • Orientation toward continuous learning

 

Fig. 5 – Attributes of a powerful question – Taken from: Amy Edmondson, The Fearless Organisation, p. 171

  • Generates curiosity in the listener
  • Stimulates reflective conversation
  • Is thought-provoking
  • Surfaces underlying assumptions
  • Invites creativity and new possibilities
  • Generates energy and forward movement
  • Channels attention and focuses inquiry
  • Stays with participants
  • Touches a deep meaning
  • Evokes more questions

 

Related links for further learning:

  1. https://www.businessinsider.com/amy-edmondson-on-psychological-safety-2015-11
  2. https://www.tandfonline.com/doi/abs/10.1080/00207284.1967.11642993
  3. https://hbr.org/2008/07/the-competitive-imperative-of-learning
  4. https://marcabraham.com/2017/08/17/book-review-radical-candor/
  5. https://www.huffingtonpost.com/matt-tenney/be-a-dont-knower-one-of-e_b_7242468.html
  6. https://hbr.org/2014/07/the-fukushima-meltdown-that-didnt-happen
  7. https://www.mindtheproduct.com/2018/05/how-to-improve-your-teams-conflict-competence-by-julia-whitney/
  8. https://marcabraham.com/2018/03/12/book-review-the-no-asshole-rule/

Book review: “Principles” by Ray Dalio

marcabraham1 Comment

“Principles” is the latest book by Ray Dalio – founder of Bridgewater, the world’s largest hedge fund. In this rather hefty tome of a book, Dalio offers an insight into the principles which he’s applied throughout his life and work, and his underlying reflections. He kicks off the book by explaining that “Good principles are effective ways of dealing with reality” and that “To learn my own, I spend a lot of time reflecting.”

 

preorder-ray-dalio-principles-book-95db76ead27720616fe067f8e730b9f17a1a1c0b115f4028e075cc73ce9dcd40.png

“Principles” consists of three parts. In the first part, titled “Where I’ coming from”, Dalio looks back on his career and the founding of Bridgewater. “Life Principles” is the name of the second part, and covers Dalio’s approach to life’s challenges and opportunities. Finally. part three covers Dalio’s “Work Principles”. Let me share the key things I’ve taken away from “Principles”, starting with Dalio’s Life Principles:

  • Embrace reality and deal with it – Dalio shares an important equation which in his view makes for a successful life: Dreams + Reality + Determination = A Successful Life. For the ‘reality’ component of this equation to work, Dalio encourages his readers to be radically open minded and radically transparent.
  • Pain + Reflection = Progress – Dalio’s point about “going to the pain rather than avoiding it” resonated with me (see Fig. 1 below). It’s easy to dismiss this statement because it’s coming from a highly successful investor, but I’d flip that as I can see how someone like Dalio has gone through his own share of pain to get to where’s he gotten to, and learned along the way.
  • Using the 5-step process to get what you want out of life – Start with having clear goals (step 1), followed by identifying but not tolerating the problems that stand in the way of your achieving those goals (step 2), then you accurately diagnose the problems to get at their root causes (step 3), design plans that will get you around them (step 4) and, finally, do what’s necessary to push these designs through to results (step 5). Dalio depicts this as a continuous process and people can benefit from applying this model to achieve their goals (see Fig. 2 below).
  • Understand that people are wired very differently – Dalio stresses the fact that all people are wired very differently, and zooms in on the differences between left and right brained thinking (see Fig. 3 – 4 below).

 

Fig. 1 – Going to the pain instead of avoiding it – Taken from: Ray Dalio – Principles, p. 154

  • Identifying, accepting, and learning how to deal with your weaknesses.
  • Preferring that the people around you be honest with you rather than keep their negative thoughts about you to themselves.
  • Being yourself rather than having to be strong where you are weak.

 

Fig. 2 – Ray Dalio’s 5-step process – Taken from: Ray Dalio – Principles, p. 171

5stepprocess.jpg

Fig. 3 – Differences between left and right brain – Taken from: https://visme.co/blog/left-brain-right-brain-marketing/

Brain1.jpg

 

Fig. 4 – Understand the differences between right-brained and left-brained thinking – Taken from: Ray Dalio – Principles, p. 223

  1. The left hemisphere reasons sequentially, analyses details, and excels at linear analysis. “Left-brained” or “linear” thinkers who are analytically strong are often called “bright.”
  2. The right hemisphere thinks across categories, recognises themes, and synthesises the big picture. “Right-brained” or “lateral” thinkers with more street smart are often called “smart.”

 

Dalio’s Work Principles are dominated by the concept of an Idea Meritocracy – i.e. a system that brings together smart, independent thinkers and has them productively disagree to come up with the best possible collective thinking and resolve their disagreements in a believability-weighted way (see Fig. 5 below). Dalio successfully implemented an Idea Meritocracy at Bridgewater and shares the components of such a system in his book:

Idea Meritocracy = Radical Truth + Radical Transparency + Believability – Weighted Decision Making

  • Radical Truth – Talking openly about our issues and have paths for working through them.
  • Radical Transparency – Giving everyone the ability to see everything. Radical transparency reduces harmful office politics and the risks of bad behaviour because bad behaviour is more likely to take place behind closed doors than out in the open.
  • Believability – Dalio defines believable people “as those who have repeatedly and successfully accomplished the thing in question – who have a strong track record with at least three successes – and have great explanations of their approach when probed.”
  • Thoughtful Disagreement – The concept of Believability is closely linked to the art of Thoughtful Disagreement; the process of having a quality back-and-forth in an openminded and assertive way to see things through each other’s eyes.
  • Weighted Decision Making – At Bridgewater, employees have different believability weightings for different qualities, like expertise in a particular subject, creativity, ability to synthesise, etc. Dalio explains that in order to have a true Idea Meritocracy one needs to understand the merit of each person’s ideas.
  • Prerequisites for an Idea Meritocracy – To have an Idea Meritocracy three conditions need to be in place. Firstly, put your honest thoughts on the table. Secondly, have thoughtful disagreement (see above). Thirdly, abide by agreed-upon ways of getting past disagreement.
  • Mistakes are part of the game – Dalio has a refreshing outlook on the role and value of mistakes, which he treats as “a natural part of the evolutionary process”. It’s important in this respect to assess whether people recognise and learn from their mistakes. Dalio distinguishes between people who make mistakes and who are self reflective and open to learning from their mistakes and those who are unable to embrace their mistakes and learn from them.
  • Get people to focus on problems and outcomes – Assign people the job of perceiving problems, give them time to investigate, and make sure they have independent reporting lines so that they can convey problems without any fear of recrimination. To perceive problems, compare how the outcomes are lining up with your goals. Dalio also offers some valuable tips on how to best diagnose problems (see Fig. 6 below).
  • Avoid the “Frog in the boiling water” syndrome – Apparently, if you throw a frog into a pot of boiling water it will jump out immediately, but if you put it in room-temperature water and gradually bring it to a boil, it will stay in the pot until it dies. If one uses this syndrome as a metaphor for professional life, it signifies people’s tendency to slowly get used to unacceptable things that would shock them if the say them with fresh eyes.
  • Don’t just pay attention to your job – Instead, pay attention to how your job will be done if you’re no longer around. Dalio talks about the ‘ninja manger’ as “somebody who can sit back and watch beauty happen-i.e. an orchestrator. If you’re always trying to hire somebody who’s as good as or better than you at your job, that will both free you up to go on to other things and build your succession pipeline.”

 

Fig. 5 – The Idea Meritocracy as is the best way to make decisions – Taken from: https://twitter.com/RayDalio/status/1066357616350253057

Dsx2YkGXcAAZVNC.png

 

Fig. 6 – Diagnose problems to get at their root causes – Taken from: Ray Dalio – Principles, p. 484 – 490

To diagnose well, ask the following questions:

  • Is the outcome good or bad?
  • Who is responsible for the outcome?
  • If the outcome is bad, is the Responsible Party incapable and / or is the design bad?

 

Main learning point: Whilst “Principles” feels a tad repetitive at times and some of Dalio’s ideas might not be easy to implement, I feel that Dalio’s principles can provide great direction for all people working in organisations, big or small.  His reflections on things such as transparency and decision-making will be valuable to anyone reading this great book.

 

Related links for further learning:

  1. https://youtu.be/c1OoWdqbKdg
  2. https://www.ted.com/talks/ray_dalio_how_to_build_a_company_where_the_best_ideas_win
  3. https://www.youtube.com/watch?v=B9XGUpQZY38
  4. https://www.youtube.com/watch?v=S7hNda9DVxo