On Heuristic Learning

Unfortunately few people are receptive to the notion that they'll benefit from your foresight. That's why empowerment is such a powerful learning tool. Only by learning what one does not know can can one open oneself to someone else's mistakes. Consequently the best partnering opportunity is one in which one's partner has a similar frame of reference and similar values.

On Self-Promotion

The brilliant writer Larry Gross wrote this to me recently as a result of a couple of e-mails I sent to him on art mashups and self-promotion in Hollywood:

"The French philosopher, (recently deceased) Jacques Derrida, in a very complex discourse on Rousseau in an early book called OF GRAMMATOLOGY theorized about writing as a "supplement" to identity. What is more and more true in our culture, is that these technologies are becoming essential supplements to identity. They are devices compensating for something missing in our existences, of which, I would argue we are unaware of to begin with--there's nothing wrong with any of this--except for our radical not-being-conscious of it. All cultural practices are supplements in Derrida's sense, and to some degree always have been--this is a transposition of a very old idea of Freud's, that "higher" cultural activities attempt to satisfy needs, impulses cravings that aren't being satisfied on a more immediate experiential-instinctual level--ANYWAY--there are a million issues here--- the distinction between self-presentation and self-invention being one juicy issue, the distinction between some presumably a "real" self, and a self as a brand. And of course in this war of all against all for people's attention, there is the question, what do we want to get people's attention FOR beyond the statistical accomplishment of having gotten it.

If one wanted to be heedlessly optimistic one would celebrate the way in which everyone becomes the screenwriter-film-maker of one's own life in this world of audio-visual technologies replicating and expanding at such insane speed. Stephen Mallarme's visionary hypothesis in the 1870's, "The entire world is exists in order to be part of a book" which pointed in the direction of results that Joyce and Proust would later achieve--now seems to be part of the currency of everyday cultural discourse. BUT there are seem to be a lot of unintended consequences (not to mention causes) for this that are not quite so constructive.

And beyond that, it doesn't seem that very many of us are conscious of what it is we're doing."

I think he hits on many interesting points, not the least of which is our own lack of awareness of what we are doing, even as we take advantage of the multitude of self-marketing methods now available to us. Are our attempts to achieve fame simply fulfilling the need to extend our identity? Do we think this accomplishment will increase our chances for success with the various ventures we pursue even as the lines between business and personal identity blur? What is the balance between self-invention and self-presentation? I've tweeted about the large numbers of social media aficionados who seem intent only on promoting themselves or their products and it's unclear to me in many cases why they even have a need to attract thousands of followers. Finally what is the "real" value of these activities, or have we become so abstracted from what is useful to existence that self-promotion is simply a kneejerk reaction when communication is easy?

The Pitfalls of Inorganic Growth on Twitter

With the rise in Twitter usage and the publication of a plenitude of stories on influential news sources, there has been lots of guidance provided recently on how to get thousands of followers using "follower-pumping" practices. These usually recommend using pyramid-scheme type tools, following people with similar interests who will follow you back, writing press releases, among other approaches. The more followers you amass, the greater the likelihood that the new people that you follow will follow you also. The use of Twitter-related rating services like Twitter Grader can also work in tandem with having a large number of followers to attract even more people, since numbers of followers is one method such tools use to calculate influence scores. So what is the downside to such approaches compared to getting followers organically? Getting lots of followers increases your influence, right? These tactics can be likened to startup companies that obtain venture capital funding early in their existence but don't have a compelling value proposition. Just like VC funding can speed the development of promising platforms, rapidly increase a company's market share due to spending on advertising and help a company grow rapidly in size, tactics to increase followers using schemes do work well enough to guarantee that one builds a large following. But what happens after that? What do you do after you get a few thousand followers? Are your tweets interesting enough or valuable enough to sustain that number? Have you interacted directly with enough of your followers that they'll remain with you even as you focus on gaining more followers? Are you producing enough content on other channels to sustain the number of followers you've amassed? If your answer to these questions is "no" then you run the same risk as a promising startup that has created initial market momentum through outside funding, but doesn't have a good enough product or management team to continue building profitable growth. Inevitably the funding runs out and since the company doesn't generate enough revenue to remain profitable with a less-than-compelling product, it goes out of business. Likewise, on Twitter your followers will eventually leave you if you cannot sustain your follower count with authentic and useful interactions and you'll be left with little credibility. Building a new audience when your reputation has been compromised is even more difficult than building that audience organically, one person at a time, through authentic and direct interaction.

Social Media Bombs

Most social media articles cover the marketing side of social media. How marketshare can be gained, products sold, reputations built on the savvy use of web 2.0 tools. But as with any compelling new technology, this medium can also be used for other purposes. One of these is the social media bomb. Defined as a series of coordinated acts on social media networks, the social media bomb is intended to attract attention through a viral dissemination of a specific message. Recently, Amnesty International asked it's supporters to send out a message at 1:10 p.m. on Friday, March 6 on Facebook, MySpace and Twitter. The message: "Each year, 1 in 10 women in Britain experience rape or other violence," was intended to raise public awareness of this issue. The results of this social media bomb are not yet known, but one can see a difference in impact between Twitter, where pages of retweets still appear and MySpace and Facebook, where nary any evidence of the message exists. Nonetheless with the profusion of social networks, and the ability to communicate on them ubiquitously, one can imagine more such awareness raising efforts in the future.

New Business Models in the Same Old Environment

To say that the recent downturn in the economy has gotten many to think about how businesses are run would probably be an understatement.  However if there is one principle that seems operative in this environment, it is that the more things change the more they stay the same.  In the past week we have seen stories highlighting Merrill Lynch's CEO, John Thain,lobbying to receive his $10M bonus.  The reasoning seems clear, he wanted to receive adequate compensation for orchestrating the sale of the 94 year old firm to Bank of America, widely considered to have been the only reason Merrill will continue to exist, at least in some form, for more years. Nonetheless that deal was made after Merrill had already lost about $11 bilion in 2008, though most of that loss has been attributed to Thain's predecessor in the job, Stanley O'Neal.   Thain had already received a $15M signing bonus upon taking the position.  Thus, argued New York Attorney General Andrew Cuomo, in a letter sent to Merrill's board of directors, "Clearly, the performance of Merrill's top executives throughout Merrill's abysmal year in no way justifies significant bonuses for its top executives, including the CEO."  But the same old ways of doing business, whether they are outdated or inappropriate approaches to the marketplace still seem to be the most widely practiced.  

According to the Corporate Library, the nearly 2000 CEOs of major corporations will still receive about a 7.5% raise overall in 2008.  Although this is far smaller than the double digit gains in previous years, this still seems out of step with the experience of employees of many corporations who are seeing unprecedented numbers of layoffs.  Indeed the average raise for a U.S. households routinely falls below 3%.   Ironically, after the CXO-led financial scandals at Enron, WorldCom and Adelphia, the Sarbanes-Oxley Act was passed in 2002 to, among other things, hold senior executives at companies accountable for the accuracy of financial statements. One of the provisions also highlighted what was thought to be one of the significant causes of these abuses--options compensation and large bonuses that were contingent upon good financial performance that, it was claimed, pressured executives to commit fraud.  Though Sarbanes-Oxley has been widely credited for the elimination or reduction of stock options as a means to provide incentive compensation, the increasing gap in CEO versus line employee pay as highlighted by this continued divergence in salary increase percentages as well as continued evidence that boards of directors have not really changed compensation practices at the highest levels of companies, reinforces again that companies are managed  no differently than they ever were.  And add to that the result of these compensation practices in 2008--scores of major investment and retail banks collapsing, economic recession and the loss of many jobs.  But there is more to this story than simply that outdated compensation practices continue and corporate malfeasance of a sort continues to have a negative impact on the economy.  Outdated practices for running business, what we'll call "operating models," also continue.  Peripatetic executives and location-locked line employees continue to be the rule, even as technology should be changing this model. Like outdated compensation packages, outdated approaches to running businesses will not improve our productivity and the work experience that most employees have, leading to unprecedented levels of job dissatisfaction.  

Other changes to operating models and incentive compensation could be adopted as common practice.  Businesses no longer have to be relegated to giving total credit for the accomplishments within companies to single individuals like CEOs.  In fact one could argue that the average CEO is getting too much credit for what amounts to creating the proper environment for great products to be created, for example.   How often can one directly attribute the performance of a company to the direct actions of its CEO?  With our abilities to now collect and analyze data it should be more possible than ever to quantify the actual contribution every employee makes to the success of the company and to reward the highest contributors accordingly.  

Likewise other aspects of business might also be improved through re-engineering operating models to accommodate a workforce that now actually has the ability to work in virtual environments without the loss of access to data or to corporate information systems, thus leading to reduced commuting times, better work-life balance, more satisfied and fulfilled and therefore more effective employees.  This is a direct result of the accessibility of broadband and mobile technology.  We are no longer in a world where a 1.5 Mbps data connection costs thousands and on-the-go access to email and business applications is costly or unprocurable.  So why haven't more companies adopted virtual workforces and eliminated capital costs associated with providing most employees with on premise office space and data connectivity?  Because the market has not yet had a competitor that outcompetes other similar businesses though the use of these new technologies.  Most businesses are still doing business the old way-by emphasizing face time, rewarding employees who have more of it under the delusion that that equates to more productivity. 

However that doesn't have to continue to be the case; but it will take rare leaders with the vision to challenge traditional approaches to business and who can win in the marketplace to change businesses everywhere.  

What Makes a Great Leader?

In the midst of the investment banking meltdown and a proposed $700B bailout some thoughts on great leadership seem timely.  All too often we assume, perhaps because Keynesian economics postulate that companies operate to benefit themselves, that corporate leaders are destined to react to financial incentives like Pavlovian dogs--eager to perform tricks of decision-making that will result in the highest possible compensation--for themselves.  I don't believe this has to be the case, though often, expectations lead to a self-fulfilling prophecy.  Rather, great leaders are able to overcome these impulses and simply lead, rather than be at best, average managers.  So how does one become a great leader?  The following list of behaviors and attitudes represents my personal observations of those I considered great leaders from over a decade of observation in Fortune 500 companies.  Your thoughts on this list are welcome.  

1)  Frankness -- Great leaders value frankness within their teams and practice it themselves.  This is not to be confused with being inclined to be critical.  Rather, this is a willingness to tackle difficult things, whether business results or personnel problems, openly.  Businesses cannot improve without a clear recognition of what is the problem that prevents excellent performance, and what is the clear path to the solution.  Those inclined to only be critical, perhaps at others' expense, make major problems out of minor ones; and new leaders who are prey to being critical are quick to highlight the mistakes of past leaders or the teams they managed, often with detrimental results.  Being willing to acknowledge that there is a problem and to approach the solution in the most direct manner possible constitutes frankness. 

2)  Understand and address the real issues -- All too often real results within a company are obfuscated by a bewildering array of data.  Executives love to obtain data, to the point where this activity might supercede actually running the business in importance.  Frequently, the vast amounts of data that are generated are used to demonstrate that there is no problem, even if business results are poor.  There should be a clear delineation between what is actually important to know or to do to run the business and those low-value-added activities that are designed to explain.  Don't let the former overwhelm the latter.  

3) Transparency -- Great leaders do not fear scrutiny, either of their decisions or of their process for reaching decisions.  They don't have ulterior motives that cause them to "game" their employees or peers to obtain hidden goals.  

4) Selflessness -- Leaders can't be great if they only serve themselves.  Great leaders focus on the success of the business because it leads to the greatest level of success for all.  They are not troubled if their decisions cause the demise of their own careers, if that is the right thing for the business.  They focus on their teams, peers and superiors before they focus on themselves. Great leaders also don't simply work to maximize the results within their area of responsibility, rather they focus on having the broadest possible impact with their activities.  They abhor succeeding at the expense of others working for the same company. 

5) Thought leadership -- Great leaders have great ideas and are willing and able to create a vision that compels others to follow.  Leaders constantly seed the organization with great ideas and are untroubled about whether they receive credit for it or not.  

6) Empathy -- great leaders can sense how their teams feel and make decisions differently because, not in spite, of it. 

7) Intuition -- great leaders have enough experience to avoid common mistakes, but they also have intuition based upon experience that results in the correct decision being made more often than not.  There is nothing worse than a leader with poor intuition. All of the data analysis in the world can't salvage an unerring aim for the worst of all possible decisions when an array of choices exists.  

8)  Common sense -- Too often common sense is the least trusted approach for making a decision in business.  Managers who love data are quick to adopt nonsensical approaches that defy common sense.  In the corporate world, teams sometimes speak metaphorically of those who seemed to wear "two hats."  That is, the same people who exhibit great common sense when making decisions for themselves become irresponsible or exhibit poor judgement when making decisions for the company.  

9) Don't wait for permission -- Great leaders don't wait to be told to address any issues that might exist.  They constantly identify and solve problems, whether others ask or not.

10)  Recognition of Accomplishments -- Great leaders are quick to recognize the efforts of the many that contributed to success when it is achieved.  

11) Ethics -- Great leaders have strong ethics and will avoid even the appearance of impropriety.  

To Invest Capital or Not to Invest?

Businesses contemplating the deployment of new technology have always struggled with a fundamental question:  will they be better positioned by extracting the greatest use out of existing technology or will capital investments in new technology actually yield better results? The answer to this question is not easily determined, primarily because all benefits of new technology deployment cannot be quantified.  Take for example, Verizon's investments in FiOS.  From investors to other telecommunications carriers, there has been mixed opinion on the value of deploying fiber optics to the home.  Initial skepticism of FiOS is apparently waning for some with Verizon trumpeting unexpected advantages from their initiative.  Others who are more financially oriented and who favor Economic Value Added-based approaches to investment however, might favor the more conservative direction of "no new capital before it's time" and that time seems to be well after the asset is deemed obsolete.  The most appropriate direction is perhaps one that focuses on the nature of the investment.  Is the investment a strategic one or not?  If one considers a carrier's network investment strategic, in other words, a differentiator from competitors in every sense of the word, and Verizon certainly seems to have taken that view with both wireless and wireline networks, then the investment is warranted since it delivers against customer desires and internal objectives.  If, on the other hand, a carrier's network is simply another undifferentiated part of their business, perhaps the wisest approach is to defer the investment or redirect it toward those things that are strategic.  There is no clear "correct" answer to this question and more will be written on it in the future.  Comments are welcome.