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Thursday, March 24, 2016

Secrets of the Superbosses 03-24


Secrets of the Superbosses









What do Ralph Lauren, Larry Ellison, Julian Robertson, Jay Chiat, Bill Walsh, George Lucas, Bob Noyce, Lorne Michaels, and Mary Kay Ash have in common?


Certainly all of them are known for being talented and successful—even legendary—in their respective fields. All have reputations as innovators who pioneered new business models, products, or services that created billions of dollars in value. But there’s one thing that distinguishes these business icons from their equally famous peers: the ability to groom talent. They didn’t just build organizations; they spotted, trained, and developed a future generation of leaders. They belong in a category beyond superstars: superbosses.


I started researching this cohort of managers a decade ago, when I noticed a curious pattern: If you look at the top people in a given industry, you’ll often find that as many as half of them once worked for the same well-known leader. In professional football, 20 of the NFL’s 32 head coaches trained under Bill Walsh of the San Francisco 49ers or under someone in his coaching tree. In hedge funds, dozens of protégés of Julian Robertson, the founder of the investment firm Tiger Management, have become top fund managers. And from 1994 until 2004, nine of the 11 executives who worked closely with Larry Ellison at Oracle and left the company without retiring went on to become CEOs, chairs, or COOs of other companies.


Eager to learn the secrets of these star makers, I reviewed thousands of articles and books and conducted more than 200 interviews to identify 18 primary study subjects (definite superbosses) and a few dozen secondary ones (likely superbosses). I then looked for patterns—common tastes, proclivities, behaviors—anything that might help explain why these people were able to propel not only their companies but also their protégés to such great heights.


I found that superbosses share a number of key personality traits. They tend to be extremely confident, competitive, and imaginative. They also act with integrity and aren’t afraid to let their authentic selves shine through.


But far more interesting (and more important for teaching purposes) were the similarities I saw in the “people strategies” that superbosses employed. Their remarkable success as talent spawners was not the result of some innate genius. These leaders follow specific practices in hiring and honing talent—practices that the rest of us can study and incorporate into our own repertoires.


Unconventional Hiring


Superbosses begin by seeking out unusually gifted people—individuals who are capable not merely of driving a business forward but of rewriting the very definition of success. As Lorne Michaels, the longtime producer of Saturday Night Live, has said, “If you look around the room and you think, ‘God, these people are amazing,’ then you’re probably in the right room.” Here’s how he and others do it.


Focus on intelligence, creativity, and flexibility.


Superbosses value these three attributes above all others. C. Ronald Blankenship and R. Scot Sellers, both protégés of real estate guru Bill Sanders before they became CEOs of leading property companies themselves, remember how Sanders would brag about bringing in so many people who were “four times smarter” than he was. He would insist that if you weren’t going to hire someone great, you shouldn’t hire anyone at all.


Superbosses begin by seeking out unusually gifted people.


Superbosses want people who can approach problems from new angles, handle surprises, learn quickly, and excel in any position. Norman Brinker, the casual-dining innovator who founded Steak and Ale, was a good example. As Rick Berman, who worked under him before founding a successful lobbying firm, recalls, Brinker “wasn’t a fan of hiring people to play first base; he just wanted to hire a good baseball player.” That emphasis on versatility helped give rise to a generation of top leaders in the restaurant industry, including the CEOs of Outback Steakhouse, P.F. Chang’s, and Burger King.


Find unlikely winners.


Superbosses consider credentials, of course, but they’re also willing to take chances on people who lack industry experience or even college degrees. According to Marty Staff, who worked for Ralph Lauren before becoming CEO of Hugo Boss USA, Lauren once made a runway model the head of women’s design “for no other reason than she seemed to get it—she got the clothes.” At health care giant HCA, Tommy Frist sometimes set even physical therapists on a path to the C-suite, simply because he spotted something in them.


Because they reject preconceived notions of what talent should look like, superbosses often show greater openness toward women and minorities. Mary Kay Ash, in fact, expressly designed her company to empower women, holding sales conferences where the message was “If she can do it, so can I.” Walsh started a fellowship program in the NFL for minority coaches, giving participants a fast track into the league and himself a chance to tap into a vast new source of talent.


Superbosses often dispense with the conventional interview process, too; instead, they pose unusual or quirky questions or use observation as a tool. When Ralph Lauren met with job candidates, for example, he would ask them to explain what they were wearing and why. Sanders would invite prospects to hike a 7,000-foot peak on his New Mexico ranch with him and other managers. “We learned a whole lot about these kids on the hikes,” recalls Constance Moore, who worked for Sanders at Security Capital before becoming CEO of BRE Properties. “After, we would all sit down and talk about each of them and figure out which ones we wanted to ask to join.”


Adapt the job or organization to fit the talent.


Superbosses opportunistically tailor jobs and sometimes even their organizations to new hires. As an assistant coach for the Cincinnati Bengals, Walsh had to invent a new offense to enable the backup quarterback to excel after an injury brought down the team’s starter. Because the second-stringer had more accuracy than arm strength, Walsh designed an unusual strategy around short passes—which later became known as the West Coast offense (when Walsh was with the 49ers). Lorne Michaels lets his ensemble’s ideas and abilities constantly shape and reshape their contributions to Saturday Night Live. Writers sometimes become performers, and performers or assistant directors sometimes become writers. At Industrial Light & Magic, George Lucas’s employees didn’t even have job descriptions. They were assigned tasks on various projects according to what was needed and who was available. All these examples run counter to traditional HR practices, but they reflect an innovative mindset that superbosses bring to virtually everything they do.


Accept churn.


Smart, creative, flexible people tend to have fast-paced careers. Some may soon want to move on. That’s OK with superbosses. They understand that the quality of talent on their teams matters more than stability, and they regard turnover as an opportunity to find fresh stars. Consider how Discovery Communications founder John Hendricks reacted when, in 1997, his second in command, Richard Allen, was asked to become the head of National Geographic’s for-profit arm. Hendricks would have loved to have kept Allen but never tried to hold him back, realizing that he’d rather have a friend leading his rival than anyone else. “It was a real indication of his generosity of spirit,” Allen says.


This kind of attitude has an added payoff: When word gets out that people who work for you succeed not only at your organization but outside it, the world will start beating a path to your door. Superbosses barely need to recruit, because their reputations bring a continuous stream of talent to them.

Hands-on Leadership

Superbosses also have a distinct way of developing employees. Take Larry Ellison. His greatest strength, according to one of his protégés, is his ability “to make exceptional people do the impossible.” I heard stories in a similar vein about other superbosses. From them, one can distill these principles:

Set high expectations.

Superbosses are bullish on what their teams can accomplish. They demand extraordinarily high performance; “perfect is good enough” captures their attitude. The legendary Bob Noyce, for instance, “could be a very, very tough taskmaster,” remembers his fellow Intel cofounder Gordon Moore. “If you were up for the challenge, you could be very successful.” But superbosses go beyond pushing hard for results and instill a sense of confidence and exceptionalism in their people. Michael Rubin, who was a young member of Lucasfilm’s Graphics Group in the 1980s, recalls how transformational it was to hear Lucas talk about his vision for digital filmmaking and the role they would all play in it. “I heard him explain what the future could be like, and I was infected with that at age 22. I believed him. And it changed my career.” Tom Carroll, now chairman of TBWA Group, sounds a similar note about former boss Chiat: “Jay left something in people that makes it hard for you to go back to being ordinary. Once you feel it, you can’t change it.”

Be a master.

Superbosses are extremely effective delegators. Having chosen smart, ambitious, adaptable people and offered them a vision, they trust the team to execute. “Norman Brinker gave us incredible autonomy,” explains Richard Frank, a former senior manager at Steak and Ale who went on to run Chuck E. Cheese. “We definitely had the ability to fail.” And yet superbosses also remain intimately involved in the details of their businesses and their employees’ work. HCA’s Tommy Frist, a licensed pilot, would take subordinates on his plane to company events, using the flight time to engage in what was almost a tutorial on some aspect of what those people were working on. I compare it to the master-apprentice relationship you find in a traditional artisan workshop. Like highly skilled craftsmen, superbosses give protégés an unusual amount of hands-on experience but also monitor their progress, offer instruction and intense feedback, and step in to work with them side by side when necessary.


Even if people leave the organization, superbosses continue to offer them advice.


Superbosses’ teachings extend to leadership and life lessons as well. Frist would counsel managers on everything from setting daily goals to the importance of exercising to stay sharp. Luc Vandevelde, the former chairman of Marks and Spencer and Carrefour, was taught by former Kraft CEO Michael Miles to walk a fine line between partnering with subordinates and micromanaging them. Miles advised Vandevelde to work closely enough with his people to “elicit skills” but not so closely that he would “limit skills.” “I’ll never forget those words,” Vandevelde explains. “They profoundly changed my management approach, creating an environment where people can be at their best.”


Encourage step-change growth.


All the superbosses I studied offered advancement opportunities far beyond those found in traditional organizations. Rather than relying solely on “competency models” to guide development and promotion decisions, they customized career paths for protégés who had proved their worth, seeking to dramatically compress their learning and growth. Chase Coleman, a disciple of Julian Robertson, says that his former boss “was good at providing a steep learning curve for people who excelled at their first task.” In fact, just three years after Coleman joined Tiger Management as a technology analyst, Robertson sent him off with $25 million to start his own fund. Larry Ellison took a similar approach, says Gary Bloom, a former executive VP of Oracle who later became CEO of Veritas. “One thing Oracle was incredibly good at was on a continual basis throwing new responsibility at people,” Bloom notes. For example, Safra Catz was acting as CEO in all but name for a decade before formally being elevated to co-CEO (with Mark Hurd) in 2014.

Stay connected.


For superbosses, counseling protégés is a long-term commitment. Even after someone moves out of their organization, superbosses continue to offer advice, personal introductions, and “membership” in their networks. Former creative director Ken Segall says that although he served under Jay Chiat for only three years during the mid-1990s, he made a practice of calling his former boss whenever he changed jobs. “Usually within two or three hours at the most, I would get a call back,” Segall recalls. “He would consult with me and advise me. He was that kind of guy.”

Maintaining relationships with ex-employees sets superbosses up for all sorts of follow-on opportunities, such as developing business partnerships. Frist helped many of the managers who’d worked for him at HCA start companies in the health care space by investing or becoming a customer. Lorne Michaels excelled at this, too, producing films and TV shows with former SNL stars Jimmy Fallon, Seth Meyers, Fred Armisen, and Tina Fey.

Superbosses employ practices that set them head and shoulders above even the best traditional bosses. They seek out talent differently and hire them in unusual ways. They create high expectations and take it upon themselves to serve as “masters” to up-and-coming “apprentices.” And they accept it when their protégés go on to bigger and better things, making sure to stay connected.


You, too, can move closer to this ideal. Don’t feel you need to try every move in the playbook at once. Experiment with one or two. Consider unorthodox applicants for open positions, looking at people who might possess unusual abilities. Remember that people are more effective when they feel confident, and make it your job to build them up. Get in the trenches more often with line employees, so you can learn more about their particular talents and challenges and impart wisdom that will help them grow. Look for opportunities to delegate big responsibility even to younger team members.
Following the superboss playbook, we can all become better at nurturing talent, creating higher-performing workforces and, ultimately, more dynamic and sustainable businesses and industries.



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Harvard Business Review Announces 57th Annual HBR McKinsey Award Winners 03-24


Harvard Business Review Announces 57th Annual HBR McKinsey Award Winners




Top article offers principles for engineering “reverse innovations” in emerging markets.



Articles in Harvard Business Review are meant to inspire leaders to adopt new ideas that can transform their companies. And from this pool of "million-dollar ideas," a panel of judges picks the very best article of the year and gives it the HBR McKinsey Award. This year's winner: “Engineering Reverse Innovations” by Amos Winter and Vijay Govindarajan published in HBR’s July-August 2015 issue.

Based on a three-year study, the article outlines how companies can successfully create products for emerging markets that can then be adapted into disruptive offerings for developed countries – a concept known as reverse innovation. As part of their research, Winter and Govindarajan followed the experiences of a team that created a wheelchair for the developing world, a modified version of which is now taking Western markets by storm. 
  
“This is a must-read for anyone who wants to understand how to apply the principles of reverse innovation and design thinking,” said Adi Ignatius, editor in chief of Harvard Business Review.
Amos Winter is the Ratan N. Tata Career Development Assistant Professor of Mechanical Engineering at the Massachusetts Institute of Technology, where he directs the Global Engineering and Research Laboratory in the Department of Mechanical Engineering. Vijay Govindarajan is the Coxe Distinguished Professor at Dartmouth’s Tuck School of Business and a Marvin Bower Fellow at Harvard Business School. He is the author of the forthcoming book The Three Box Solution: A Strategy for Leading Innovation (HBR Press, April 2016). 
  
The annual HBR McKinsey Awards, judged by an independent panel of business and academic leaders with input from members of HBR’s Advisory Board, commend outstanding articles published each year in Harvard Business Review. This year’s announcement appears in the April issue of the magazine, which is available online today and hits newsstands March 29.
This year’s HBR McKinsey Awards also recognizes three finalists:
The 2015 HBR McKinsey judges were: Scott Anthony, Managing Partner, Innosight; Cathy Benko, Vice Chairman and Managing Principal, Deloitte LLP; Robin Ely, Professor, Harvard Business School; Vijay Govindarajan*, Professor, Tuck School of Business, Dartmouth; Kurt Kuehn, Chief Financial Officer (retired), UPS; Rita Gunther McGrath, Professor, Columbia Business School; Robert E. Moritz, Chairman, PricewaterhouseCoopers; Kevin Sharer, Senior Lecturer, Harvard Business School; and Robert J. Thomas, Managing Director for Research; Accenture Institute for High Performance. 
  
*Note: Judges recuse themselves from voting on articles they authored.
About the HBR McKinsey Awards
  
Since 1959, the HBR McKinsey Awards have recognized practical and groundbreaking management thinking by determining the best articles published each year in Harvard Business Review. Past winners include Peter Drucker, Clayton M. Christensen, Daniel Goleman, Rosabeth Moss Kanter, George Stalk, Michael E. Porter, Mark R. Kramer, and John Kotter.
About Harvard Business Review
  
Harvard Business Review is the leading destination for smart management thinking. Through its flagship magazine, 13 international licensed editions, books from Harvard Business Review Press, and digital content and tools published on HBR.org, Harvard Business Review provides professionals around the world with rigorous insights and best practices to lead themselves and their organizations more effectively and to make a positive impact.

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Thursday, March 10, 2016

Progress on Clean Energy 03-11


Progress on Clean Energy

























   
It’s been barely two months since I got to be part of some exciting announcements about energy innovation, but there’s already some excellent progress to tell you about. Here’s a quick update.

Just weeks before the announcement, Senator Lisa Murkowski went to the floor of the Senate to make a crucial point: If we’re going to make energy more affordable and reliable while solving the problems created by climate change, we need innovative new approaches. She called on her colleagues to work together to speed up the cycle of innovation. 

Since then, her call has been clearly answered. Senator Murkowski and Senator Maria Cantwell joined with colleagues from Tennessee, South Carolina, Illinois, and Hawaii to lead a series of votes in the Senate that laid the groundwork for expanding the federal government’s investments in energy R&D. This weekend, the President highlighted their leadership when he announced that his 2017 budget will call for significant increases in this funding.

This is all very promising, because government investments in early R&D are an essential foundation for successful, innovative industries. The digital revolution was built on government investments in the Internet and the semiconductor.

Our thriving biotech industry relies on government investments in basic and applied research into drugs and other therapies. Energy is actually one area where we have historically invested far too little, so it is fantastic to see leaders changing course.

I’m also excited about what’s happened since the announcement of the Breakthrough Energy Coalition last November. We are ready to bring together private investors who will support the most promising energy breakthroughs.

We are also working with the top American research institutions to make it easier to take the innovations that come out of their labs—which are supported by government investments in R&D—and turn them into products that change the way we generate energy.

I’m sure I’ll have more to report in the coming months. I’m feeling quite optimistic about the progress we’ll see in 2016 and the years ahead.

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