It’s often more honoured in the breach than in the observance. But, CSR (or Corporate Social Responsibility) has moved from a ‘nice to have’ add-on to being an obligation many of the world’s largest corporations are embracing.
Yet, while some do it with relish, others display more reticence. And it sometimes seems that no two of them have the same interpretation of what it means. After all, the centuries old profit motive is easy to define and straightforward to measure. But social responsibility… Is that about development, fairness, environmentalism, or what?
These two strikingly simple and obvious questions have been answered rather well, by two British management thinkers, Rob Goffee and Gareth Jones.
Rob Goffee and Gareth Jones
Rob Goffee is Professor of Organisational Behaviour at the London Business School and is a long term academic. Gareth Jones, on the other hand, has alternated between academic and corporate roles, teaching at LBS too, and also the University of East Anglia, Henley, INSEAD, and currently, IE Business School, in Madrid. But he has also held senior HR roles at Polygram and the BBC.
Their first collaboration was a relatively unremarked book, called The Character of a Corporation. But it introduced ideas that they were to return to in their second, breakthrough book, and then again in their recent fourth book.
Their second book was called Why Should Anyone be Led by You? It introduced a mass business audience to the concept of Authentic Leadership. This was emphatically not their creation, tracking back to classical Greek thinking, and the Delphic injunction to first know yourself.
But their articulation struck a chord. It came at the right time and was delivered compellingly. Goffee and Jones argued that companies are led in far too much of a technocratic way, by people acting as managers and bureaucrats. They lack sufficient human connection with their people, and self awareness about their shortcomings.
Real leaders, they argued, are confident in who they are and what they stand for. They are not afraid to put that on show and constantly act with integrity in the way that they live the values they espouse. They are able to communicate well, and remain true to themselves, whilst still coping with and adapting to rapidly changing events. Consequently, they can inspire people to extraordinary levels of commitment.
Leading Clever People
The next book Goffee and Jones wrote addressed the challenges of leading an organisation or team made of smart, creative people. This is a typical challenge for many of today’s start-up businesses. It is also important for established businesses that want to bring together innovation teams, and for professional service businesses that want to create a great culture. The book is called Clever: Leading Your Smartest, Most Creative People.
A summary of the do’s and don’ts might look like this:
Explain and persuade
Give people space and resources
Tell them what
Give people time
Provide boundaries (simple rules)
Protect them from the rain
Give real world challenges with constraints
Create a galaxy
Conduct and connect
Tell people what to do
Allow them to burn out
Tell them how
Give frequent feedback
Expose them to politics
Use bullsh*t or deceive
Build an ivory tower
Recruit a star
Take the credit as a leader
Creating an Authentic Organisation
Goffee and Jones’ latest book is Why Should Anyone Work Here? It applies many of their earlier ideas to making a great organisation. At its heart is a simple mnemonic that spells out the six ingredients they argue are needed for a ‘dynamic and future-fit’ workplace: DREAMS.
Diversity increases creativity, which decreases with uniformity. Don’t do diversity because legislation compels you to. Do it because it has a positive impact on the bottom line: more creativity, better decisions, happier workforce.
(I know – a bit of a fix)
The more open and transparent you are, the happier people will feel. And if being open is likely to expose unfairness that will anger people, radical honesty will compel you to fix the problem, rather than hide it beneath dissembling..
“You need to tell someone the truth before someone else does,” said Jones. “Think of BP’s failure to control information after the [Deepwater Horizon] oil spill. Reputational capital is much more important and much more fragile than we ever thought.”
(This acronym-building is tough!)
This is not just about improving the business; it’s about adding value to the people within your business… as a means of improving your business.
There it is… Their earlier work popularised the concept, so its front and centre here too.
But, reflecting on how the ideas have settled in over the years, Goffee and Jones note that in the US, authenticity is too often read as ‘be yourself… find your true north.’ But their view is that an effective leader needs to be ‘yourself more skilfully.’
This is about ensuring everyone in the business understands the real purpose behind the tasks they do.
(one last shoe-horn!)
Businesses need systems. But this too easily leads to over-bureaucratisation. Rules need to work for the business and enable staff to do what’s right, not just prevent every single possibility of doing wrong.
In the 1980s, globalisation was the ‘Big New Thing’. Never mind that Chinese and Levantine traders had traded across half the globe at the start of the first millennium BCE. At the forefront of thinking about how multi-national corporations could organise themselves to prosper were a truly multi-national pair: an Australian, who’d worked in London and Paris and now occupied a professorship in the US, and an Indian who’d studied in the US and was a professor in France.
Christopher Bartlett and Sumantra Ghoshal surveyed the way multinationals organised themselves and categorised when each of the structures would be appropriate. Their legacy is visible on our high streets, in our back-offices, in factories and in building services today. A huge proportion of the goods we use are sold by multinationals.
Christopher Bartlett was born in 1943, and grew up in Australia. He studies Economics at the University of Queensland, gaining a BA in 1964. He worked as a marketing manager for the Alcoa company in Australia, before becoming a consultant with the London office of McKinsey and Co, and then a General Manager in France, for Baxter Laboratories.
But academia called to Bartlett, and he travelled to the US, to do a Masters (1971) and then PhD (1979) in business administration at Harvard, joining the faculty of Harvard Business School in 1979. He remained there and is not an emeritus Professor.
Sumantra Ghoshal was born in Calcutta, India, in 1946. He studied Physics at Delhi University, gaining his BSc. From there, he worked from 1969 to 1981 at the Indian Oil Corporation.
In 1981, a Fulbright scholarship took Ghoshal to the US, where he took a an SM at MIT in 1983, then did something extraordinary. He worked on and completed two different PhD theses at two different universities, at the same time. He was awarded a PhD by MIT in 1985 and a DBA by Harvard the next year.
And in 1985, he took up a position at Insead, where he became Professor of Business Policy in 1992. Two years later, he moved to the London Business School to become Professor of Strategic Leadership. He remained there until his untimely death from brain haemorrhage in 2004.
Managing Across Borders: Strategies for Multi-National Corporations
Surveying 250 managers from 9 multinational companies, Bartlett and Ghoshal concluded that there are three principal models that multinationals followed:
The Multinational – ‘Multi-domestic’ – Corporation
The Multinational structure is a decentralised, federal organisational structure that focuses on local markets and has only loose central control. They later called this model ‘multi-domestic’, and is most responsive to local demand. The corporation looks most like a portfolio of different companies. Now, these will be seen as band portfolios in which the brands have a lot of autonomy and much of their own infrastructure.
Food and drink, and household appliances are products that most need this strategy.
The Global Corporation
The global organisation tries to gain maximum economies of scale by centralising as many of its functions as possible. This often results in brands sharing infrastructure and services, leading to a lot of strategic decisions being driven by functional expertise and priorities. Brands therefore become increasingly global and undifferentiated in local markets.
Plant and heavy machinery, technical equipment, and raw materials production are products that most need this strategy.
The International Corporation
Here, there is a lot more centralisation than in the multi-domestic corporation. But there is also more local autonomy than in the global model. One role of the centre is to facilitate knowledge transfer among the trading divisions, so they can share technologies and achieve economies, while making some of their own choices to optimise use of domestic supply chains and expertise.
Textiles, light machinery, and printing and publishing are products that most need this strategy.
A Fourth Model…
Bartlett and Ghoshal considered that these three models left open the possibility of a new, fourth structure. This would combine elements of all three, and they also assessed which of the four models would work best, according to two pressures:
When both pressures were high, their new model would be most suitable:
The Transnational Corporation
The transnational corporation is the most complex. It balances widespread global integration of technology and supply chains against the need to adapt products and services to local market preferences. It is supported by a strong central headquarters, that is able to move managers around to gain international experience and share knowledge.
Cars, consumer electronics, and pharmaceuticals are products that most need this strategy.
From Systematic Efficiency to Responsive Innovation
Bartlett and Ghoshal also discerned powerful shifts in the fundamental needs of a business strategy. Where Michael Porter had laid out strategies that would allow companies to win the largest share of a market, Ghoshal and Bartlett argued that corporations need a strategy to create value anew, and grow their market as a way of winning business. They said companies need to innovate their way out of market pressures, rather than push against them.
They also challenged the orthodoxy that began with the Scientific Management movement of Taylor, Gantt, Adamiecki, and the Gilbreths, and then the efficiency drives of people like Ford and Sloane. Sloane’s approach of Strategy, Structure, and Systems became the McKinsey 7S model. But Bartlett and Ghoshal wanted to replace Strategy, Structure, and Systems by Purpose, Process, and People.
The three Ps were the new building blocks of a corporation. In a series of articles for the Harvard Business Review, they placed responsibility for each of these firmly on the shoulders of top management.
So here we are, in 2017. And our world is dominated by a range of global, multinational, and transnational corporations, whose focus is on process and whose mantra is people. Not a bad body of work to act as a symbol of what multinational collaboration can achieve!
Psychologists and, before them, philosophers have spent centuries trying to divide us into types. Whilst their attempts have had somewhat less of the hocus-pocus and downright prejudice to them than the racial typographies of some early ethnographers, many systems have advanced little beyond Hippocrates’ theory of four temperaments based on the bodily humours.
Rigour in Personality Testing
It wasn’t until the twentieth century that scientists had the statistical tools to analyse and understand personality with any rigour. Even so, the strongest, most widely used personality classification system – the so-called ‘Big Five’ Personality Factors – is still a matter of much research and debate as we reach approach the third decade of the twenty first century.
So perhaps the biggest change that the twentieth century wrought was not in reliability, but in accessibility and application. Personality assessment tools became widely popular and, through the second half of that century, widely used in workplaces to support selection, group development, team-building, personal development, marital counselling, and a range of other uses. Not all of the uses have been endorsed by the developers of these tools. And not all tools are widely supported by the more rigorously trained academic community of psychology.
The Myers-Briggs Type Indicator
And so we come to Katherine Briggs and her daughter, Isabel Briggs-Myers. Their tool, the Myers-Briggs Type Indicator, is very widely used. Every day, trainers and development professionals introduce it to new cohorts of staff and managers. These employees often take full self-evaluation questionnaire and are then told what this means about them and their colleagues.
The moments of insight are a joy to watch. The MBTI certainly seems to capture something of our personality, and explain something of our behaviours. But does it? This remarkably resilient and successful tool started through nothing less than a mother’s desire to understand her daughter’s choice of husband. What mother can’t empathise with that?
Katherine Cook Briggs
Katherine Cook was born in Michigan, in 1875 and was home schooled. Her father was an academic. She went to college to study agriculture and stayed on as a teacher and academic. She married prominent physicist and administrator, Lyman Briggs.
As her daughter grew up, Briggs became interested in children’s educational and social development. This led her to create a vocation test for children, which she thought could guide a child’s future well-being. This thinking focused on four personality types: meditative, spontaneous, executive, and sociable. These are still present among the wider set of 16 MBTI types.
Her quest was to find one unifying theory, and she considered ideas from many philosophers, scientists, and psychologists. Her own big breakthrough was when she discovered the work of Carl Jung. He advocated for four principal psychological functions by which we experience the world: sensation, intuition, feeling, and thinking. This, along with our orientations to extroversion or introversion, give us the Jungian Personality Types, which Briggs and her daughter developed into their own type indicator model.
Isabel Briggs was born in 1897, and was home schooled by her mother. Following her mother’s discovery of Jung’s work, Briggs-Myers (now married) became interested in the work too, focusing on how character and personality influence the type of work we might thrive in. Together, they developed their framework and the questionnaire that goes with it. They began a long program of observation and discussion, refining their interpretation of Jung’s work.
During World War II, Briggs Myers wanted to help reduce conflict among people, but more pragmatically also to understand why some people hated their jobs in the military and others thrived.
It wasn’t until 1945 that they did some solid empirical research. With the help of Lyman Briggs, they ran their first MBTI assessment on around 5,500 George Washington Medical School students. Briggs Myers studied the results for years, searching for patterns among dropouts and successful students.
The Outcome of the Work
Briggs was the primary driving force and inspiration behind the creation of the MBTI from Jung’s original work. Briggs-Myers created the physical test itself, and did the work on validation and interpretation.
The result was one of the best-known and widely used personality tools, the Myers-Briggs Type Indicator. Wikipedia reports that an estimated 50 million people have taken the MBTI. Whilst it is not widely endorsed by the academic community, and is based on largely desk-research and theorisation, rather than empirical trials, the MBTI remans popular. This is doubtless due to the ease of superficial understanding.
The Myers-Briggs Type Indicator – MBTI
The MBTI classifies personality types along four pairs of categories. Briggs-Myers and Briggs claimed that we all fit into one of the 16 possible combinations of personality type, and that we have a dominant preference in each pair.
The Type Indicator is a test to assess which personality type offers the ‘best fit’ with the assertion that knowing your personality type that will help you succeed in life. The three original pairs of preferences from Jung’s typology (Extraversion and Introversion, Sensing and Intuition, Thinking and Feeling) are supplemented by a fourth pair (Judging and Perceiving), added by Briggs-Myers.
This is a phenomenally rich model and there are many excellent resources online. So here, we’ll only attempt a very superficial outline of the types.
Extraversion (E) or Introversion (I)
This axis refers to where where we get our energy from, and where we direct our attention. This can be on people and things in the outer world; extraversion. Or it can be on ourselves and our inner world; introversion.
Sensing (S) or Intuition (N)
This axis refers to how we like to deal with information. People with a Sensing preference tend to focus on the basic information, whilst the Intuiting type prefers to interpret the information, and add meaning.
Thinking (T) or Feeling (F)
This axis refers to how we like to make decisions. Thinkers like to make objective decisions, using logic and rationality. The feeling style is more subjective, considering special circumstances, and how people feel.
Judging (J) or Perceiving (P)
This axis refers to how we like to dealt with experiences and circumstances. The judging style prefers to make a choice, and stick with it. The Perceiver likes to stay open to new information and options, and respond flexibly.
Assessment of the MBTI
The MBTI correlates poorly with more robustly researched psychological traits or types models, like the Big Five Personality factors. So why do so many people readily endorse their MBTI type? The answer, I think, lies in a combination of two factors.
Firstly, while not a strong correlation with rigorous typographies, it is derived from extensive observation and the factors that make up the MBTI undeniably exist – regardless of whether they are truly the ‘right’ fundamental elements of personality.
And secondly, we have our old friend, the Forer Effect. This is the tendency of people to rate sets of statements as highly accurate for them personally even though the statements are highly general and could apply to many people. If this sounds worrying, it is. The Forer Effect (sometimes known as the Barnum Effect (after showman and huckster PT Barnum) is also the basis of much mentalism and fraudulent cold reading.
The MBTI definitely has value as a personal and executive development tool. But if the trainers and specialists who deploy it do not make its limitations clear, they are doing your organisation a disservice.
It’s not how intelligent you are that matters,says Dr Howard Gardner. Rather, what really matters is how you are intelligent. Howard Gardner is an eminent psychologist who gave us the theory of Multiple Intelligences, and is now working on an even bigger topic; what it means to be good.
Howard Gardner was born in 1943, in Scranton, Pennsylvania. His parents had fled Nazi Germany before the war. He was a scholarly and musically able student and in 1961, he entered Harvard College to study Social Relations, gaining his AB in 1965. After a year spent studying Philosophy and Sociology at the London School of Economics, Gardner returned to Harvard University to study for a PhD in Social Psychology.
In 1967, during his doctoral studies, Gardner joined the new Project Zero research team at the Harvard Graduate School of Education, as a research assistant. He has remained a part of that project throughout his career, becoming a director and now Senior Director of the project. As a major research centre and intellectual powerhouse for researchers into education, it has been a superb base for much of Gardner’s research and thinking.
In 1979, Gardner was among a number of Harvard researchers who collaborated in the Project on Human Potential. This opportunity led directly to Gardner fully developing and publishing the theory he is best known for. That theory is the Theory of Multiple Intelligences, which he published in full, in 1983, with his book, Frames of Mind. This model has been widely welcomed in educational circles, although it has also been criticised, especially by some psychologists and researchers into intelligence. We covered multiple intelligences in an earlier article.
Gardner’s ample academic career is marked by hundreds of articles (both scholarly and popular), around 30 books, dozens of awards, a CV (dated 2012) that runs to 87 pages (!) and steady progress up the academic career ladder:
1971-72: Post-doctoral research at Harvard Medical School, into Aphasia
1972-86: Lecturer at Harvard
1986-98: Professor at the Harvard Graduate School of Education
1998- now: John H. and Elisabeth A. Hobbs Professor of Cognition and Education, Harvard Graduate School of Education
In 1996, along with psychologists Mihaly Csikszentmihalyi and William Damon, Gardner co-founded The GoodWork Project – now The Good Project. This collaboration researches into the meaning of good work, effective collaboration, digital citizenship, and civic participation. It sits within Harvard’s Project Zero.
Gardner’s theory of multiple intelligences continues to dominate his reputation, and justly so. Wherever you sit on the scale of critic to convert, it has clearly had an impact on education in many places. And whether the model turns out to have an underpinning in the neural structure of our brains or not, the over-arching principle – that people have different abilities in different areas – is hard to deny. If that means we are better at valuing people for their various talents, rather than deprecating their lack of ability in one or two arenas valued by a selective system, that must be a good thing.
And Gardner continues to weigh in on many big debates in educational theory; not least the nature versus nurture debate. I suppose the biggest critique of Gardner’s approach – particularly in his work on Multiple Intelligences – is his focus on observation over experimentation. Much of his analysis results from careful intellectual (and therefore subjective) analysis of observation. But careful is the operative word. For many years, he has resisted wrapping new intelligences into his framework of eight – despite much advocacy from varying quarters. he does not find their cases compelling enough. However, his criteria are not clear and do not seem to have any testable, quantitative under-pinning.
The Good Project
In The Good Project, Gardner and his co-workers are interested to understand what makes ‘good’ work, ‘good’ education and so on. In this, he seems to be returning – with psychological and sociological methods – to the Greek fascination with what makes a good life.
Their conclusions can be summed up in three words. Being good in all the endeavours they have studied requires:
Interestingly to me, the first two very much echo the ideas Csikszentmihlyi developed in his theory of Flow.
Howard Gardner at TEDx in 2015
Here is Howard Gardner, ranging across his two primary interests; multiple intelligences, and what makes good work. You will see he refers to the work of Angela Duckworth.
In my naiveté, I have always thought the arguments for diversity were self-evident. One look at the politics of any nation, and of the world as a whole, is enough to prove that this is clearly not the case. So we must be grateful to people like Sylvia Ann Hewlett, who are making the case. Here is a woman who has established a research centre, writes extensively, consults with global corporations, and speaks out in the media.
Sylvia Ann Hewlett was born in 1946 and grew up in South Wales. She took her MA at Cambridge University and then went to Harvard as a Kennedy Scholar. She returned to the UK to study economics at the University of London, where she earned her PhD.
Hewlett returned to the United States, becoming an Assistant Professor of Economics at Barnard College. From there, she went on to become Head of the United Nations Economic Policy Council.
In 1987, Hewlett quit the role and started writing, which she has continued steadily. She has authored a number of books, and many articles in premium magazines and online journals. In 1993, she founded the Center for Work-Life Policy in New York. This is a not-for-proft research institute, which studies diversity and talent management. It is now called The Center for Talent Innovation, and its work has been widely published, particularly in the Harvard Business Review.
Hewlett followed this up by creating a commercial business, now called Hewlett Consulting Partners, which works with large corporations to implement ideas around diversity and talent management.
Hewlett’s Two Big Themes
There are two big themes in Hewlett’s work:
the value of diversity in driving good quality decision-making, and supporting long-term growth
how people who do not fit the current unpublished template their employers have for successful executives can cut through and succeed
Early in her career as an author and thinker on these matters, Hewlett’s primary focus was on gender. More recently, she has opened this out into many dimensions of diversity , such as geography, culture and ethnicity, sexual orientation, and generation. Indeed, in today’s (autumn 2016, ahead of the presidential election) United States, it is not surprising to find a lot of her public comment focusing on the role of Latino workers, and also women of colour and the LGBT community.
Her most recent publication, a research volume published by The Center for Talent Innovation called ‘Growing Global Executives‘ argues that leaders need two core competencies:
the ability to project a leadership presence that can establish credibility with their boards and their stakeholders, and
the ability to harness the value of globally dispersed and culturally diverse teams by developing an inclusive style of leadership.
One of Hewlett’s recent books is 2014’s ‘Executive Presence‘, which I suspect is her biggest seller. Aimed primarily at women, but valuable for anyone who wants to be seen as a potential or actual leader, the book sets out three elements you need, to project ‘presence’. These, Hewlett suggests, are all learnable.
Filled with anecdote and structured checklists, this is one of the stronger books on a topic that is hard to pin down with real evidence. At what stage does a large body of anecdote become empirical data? I shan’t answer that question.
Hewlett’s three elements of Executive Presence are:
How you act (Gravitas)
How you Speak (Communication)
How you look (Appearance)
The books reports wide surveys of executives, that give evidence for what makes up these three overlapping dimensions. Curiously, a critique of the research is its bias towards US culture.
Gravitas, for example, is made up of:
Fundamentally, it is your ability to be seen and valued as a real expert in your subject matter.
Sylvia Ann Hewlett Speaking about Executive Presence
With the advent of the internet, we may feel like we are living in some form of global village. But if we allow that to translate into a belief that we are all the same, we will find ourselves running into problems. Each culture is different and these lead to differences in value. So when we try to communicate with one another, if we misread those cultural values, we can readily end up with misunderstandings, disputes, or conflict.
Dutch engineer and social scientist, Geert Hofstede, studied the systematic differences in national cultures and identified four, then five, then six dimensions on which to describe those differences.
Hostede was born in 1928, and grew up in The Hague, in the Netherlands. Although he went to study for an MSc in Mechanical Engineering at Delft University, in 1953, he had already had early experiences travelling to England and Indonesia, after technical college, which were to put him on the track of study cultures as a social psychologist. It was in post war England that he describes experiencing culture shock – his surprise at the difference between England and Holland, despite the geographic proximity and shared historical experiences.
After University, Hofstede spent two years with the Dutch army, and then ten in three commercial organisations, learning the craft of management. The third of these was IBM, where he founded the Personnel Research Department in 1965, which he led until 1971. It was during this time that he studied part-time for his PhD in Social Psychology at Groningen University.
It was also during this time that he gathered data on values and cultural outlook from 100,000 IBM employees around the world. This was to form the basis of his research, first published in Hofstede’s 1980 book, Culture’s Consequences. This compared cultural norms, behaviours and values across different countries. He originally identified 4 dimensions, which he later increased to five.
In 1980, he co-founded the Institute for Research on Intercultural Cooperation, which is now located at Tilburg University. He was its first director, until he retired in 1993.
Hofstede originally described four cultural dimensions, which he expanded to six incorporating research by Michael Harris Bond into long-term orientation, and Michael Minkov into indulgence and restraint.
These six cultural dimensions are:
This measures the tendency for society members to prefer being part of a strong group. Western societies such as those of Northern Europe and North America tend to be more individualistic, whilst Latin America and Asia have more collectivist cultures.
Some societies are more tolerant of ambiguity and more accepting of change. Others enforce behavioural norms and regulations strongly, to suppress change. In Europe, Southern and Eastern countries, including Germany, are more avoidant, whilst the Anglophone and Nordic countries are more accepting. Chinese cultures have low scores for uncertainty avoidance.
This measures inequalities of power within the society, and the level of unquestioned authoritarianism. Traditional societies and societies with strong religious adherence seem also to have high scores, such as in Asia, Latin American and Africa. Northern European countries have lower scores.
Masculinity – Femininity
This dimension measures assertiveness, desire for material gain, and tendency to honour competitive personas, against a more empathic, caring and co-operative culture. This varies widely across continents, with Scandinavian countries strongly to the Feminine end of the spectrum, and Anglophone countries strongly Masculine.
Far Eastern countries like China are archetypes of very long range mind-sets, while Africa and the Muslim world, along with Anglophone countries are much shorter term in their outlook.
Indulgence – Self-restraint
This measures the extent to which people seek immediate gratification and pleasure, as opposed to a more disciplined, ascetic outlook, which strongly enforces social norms. Latin America and the Western countries tend to be more indulgent, whilst Asian countries and the Muslim world tend to be more restrained.
Hofstede’s work is not without its stern critics. Whilst I am unqualified to judge it against these, one criticism seems to be self-evidently valid. Hofstede’s original work was based on his IBM survey data. Whilst this did indeed span very many national cultures, the survey set was highly dominated by white collar males – the sales and engineering employees of IBM in the 1960s and 1970s. We have to question the representativeness of that sample.
And, whilst the cultural descriptions Hofstede’s work allocates to different nations ring true; we must also question how far this takes us from stereotyping. However, Hofstede’s work does find practical application in International commerce, particularly in the fields of marketing, communications, and negotiation.
Hofstede’s work has also been applied to organisational cultures, but this seems to be an extension beyond his original research base. For a stronger link to organisational cultures, we need to look at the work of another Dutchman, Fons Trompenaars, whose model of 14 cultural polarities is also widely used.
What will work be like in the future, and how will we respond to it? These are big questions being asked by the influential and much respected Professor of Management Practice at the London Business School, Lynda Gratton. The answers she is uncovering are both obvious and important. We won’t know if her work is ‘right’ until the future arrives, but for now, we would be wise to understand the trends Gratton is uncovering, and respond to them.
Lynda Gratton was born in 1955 and, grew up, and was educated in the north west of England, in Liverpool. She gained her BSc in Psychology from Liverpool University in 1976 and started work there on her PhD. In 1979, she started work with British Airways as Chief Psychologist, while continuing her doctoral studies into Maslow’s Hierarchy of Needs. She was awarded her PhD in 1981 and, in the following year moved to management consulting firm PA Consulting.
She stayed at PA until 1989, becoming their youngest Director at age 32. But Gratton valued the autonomy to create time to read, think, and be with her family above the high salary. So she took a post as an Assistant Professor at the London Business School in 1989.
We need to start our summary of Gratton’s most important thinking with the forces she identifies as driving change in the world. I think each of us might add one or two of our own, but it is hard to dispute that each of these five will have a big impact. What gives her list credibility is the wide range of big name organisations that collaborated in her research.
Some of the big developments she points out that will affect us (and some of the other forces, below) are:
Cognitive assistants (advanced knowledge systems moving towards artificial intelligence)
Cloud and distributed computing – especially linked to mobile devices
Digitisation of knowledge
At some point she projects (as do many computer scientists) connected computers will start to become capable of creating knowledge without human help. (Note that this is not the same as the potential ‘singularity event’ of computers gaining consciousness, which is at another tier of speculation)
Here we can see trends like labour force mobility, especially in the direction of mega cities that are, increasingly, in the East. This is feeling and fuelled by the emergence of the new economies; the so called BRIC and MINT nations (Brazil, Russia, India, China, and Mexico, Indonesia, Nigeria, Turkey – along with other less acronymed nations like South Korea and Egypt). Many of the new dominant player will bring new cultural and societal norms to the world of work.
Demographic Changes (and increasing longevity)
The biggest changes will be shifts in life expectancy and the struggles of Western nations in particular to meet expectations around retirement. But as populations age and birth rates decline in the presently less developed nations, the same effect could have far greater implications.
There are so many trends here – many linked intimately with technology, globalisation and demographics. Women’s social and economic power cannot (and should not) do anything but rise. Freelance work will increase to take advantage of technology and meet the caring needs of people with ageing relatives. Predictions of the demise of family life or the increase in attention given to families from home-based workers seem the most confused – but then the future may not yield neat categories.
The need to shift to a low Carbon economy to protect the world from rising atmospheric CO2 levels and the inevitable devastating consequences of the global climate changes it will drive will increasingly dominate our futures. This will have complex economic impacts – but nothing compared to what will happen if oceans rise substantially and crops fail around the world. I’d like to see Gratton give more attention to the consequences of water stress and the geopolitical impacts of large mismatches of water availability and need that we can readily predict.
The Three Shifts we can Expect to See in our Lives
These are big forces and Gratton envisages three big shifts in our lives.
There are too many generalists, so the law of supply and demand will crush their economic value. This will drive a shift to in-depth mastery and narrow specialisation of workers. We can easily see how she comes to this conclusion, as the five forces combine to drive and facilitate this shift.
Linked to this is the need and increasing ability for workers to connect with one another globally. She thinks our work lives will become less competitive and more collaborative. Gratton coins two interesting concepts:
Your narrow group of close collaborators, whom she calls ‘the Posse’
Your wider group of loosely connected working relationships, which she refers to as ‘the Big Ideas Crowd’
Quality of Experience
From my point of view, her third shift is the most parochial: a move from focusing on standard of living to the quality of our experiences. In Gratton’s timeframe of now to 2025, I doubt this will be a major trend outside the wealthiest parts of the world (and, even here, it may only apply to the wealthy middle and affluent classes). The displacement of work by machines has been heralded for over 100 years and the rise of hedonistic society for many hundreds. I’d like to buy into this one, but it feels most like a consumer business driven rehash of an old trope (Sorry Lynda).
The Five Impacts this will have on Organisations
What I do one hundred per cent buy into is Gratton’s assessment of the big impacts these shifts and forces will have on global-scale organisations. Small, local organisations will lag behind, but even they will need eventually to bow to some of these changes.
Connectivity will drive the need for more transparent leadership of our corporations (while many will fight it, fearing the impact of consumer reactions). This will need a more authentic style of leadership from individuals throughout those organisations.
Cross border, cross timezone working has grown up over the last 20 years, and will increase. From my perspective, real, empirical research in how to drive high performance from virtual teams is still lagging this trend. This is a hard question, because we evolved to co-operate in small, intimate, and geographically contained teams. We need to find ways to optimise our reactions to an alien environment.
Cross Business Networks
‘Social Capital’is not just something we acquire as individuals, Gratton suggests. Corporations need connectivity to drive innovation and profitability. I predict that these wider eco-systems may yet morph into the dystopian mega-corporations and global cartels of science fiction.
Partnering with consumers and entrepreneurs
As more workers become independent freelancers, and consumers become more savvy about what they want, corporations will increasingly need to extend their relationships to more fully engage with them.
You didn’t see this one coming, did you? (Joke) If social, demographic, and lifestyle preferences are shifting, then so too will work patterns. And this will require flexibility from employers.
Lynda Gratton at TEDx
Hear Lynda Gratton talking about how to be ready for the future now, at a TEDx event at the London business School in 2012.
Many of us in the UK (home of the Pocketblog) and the US may harbour the false belief that online global commercial domination is a purely US-centred phenomenon. After all, Amazon, Google, Facebook and eBay’s only online competitors in revenue terms are the more insular Chinese businesses JD and Tencent. But kicking at their heels, and with equally large ambitions, is a name that I suspect will become more familiar in the coming years: Rakuten. It was founded by Japanese entrepreneur, Hiroshi Mikitani.
Very Short Biography
Hiroshi Mikitani was born in 1965, in Kobe, Japan. His father is an economist (Professor at Yale and Emeritus Professor at Kobe University) and his mother was in business. After graduating from Hitotsubashi University in 1988, Mikitani gained a place with the prestigious Industrial Bank of Japan and there he may have been expected to stay, had he not bucked the trend of Japanese culture. But a posting in the US led him to apply for a Harvard MBA, which he earned in 1993. There he was exposed to more of the entrepreneurial culture he had experienced when his father had moved to Yale and, in 1997, at the start of the internet as commercial platform, he left the bank.
He started the business now trading simply as Rakuten and, whilst it has been acquisitive and so has he personally (acquiring a range two sports teams and more latterly, gaining senior cultural appointments), Rakuten is the platform for his business interests and philosophy of business.
Rakuten is a Japanese-based e-commerce business working in a different model from most of its large US competitors. Currently, with a 2014 revenue of US$5.6 Bn, it is the tenth largest online business in the world by revenue, and fifth largest e-commerce trader. Rakuten’s model is unlike others in that it trades by selling trading space to small and medium businesses – a bazaar model. Unlike Amazon’s market place, however, Rakuten’s traders can customise their stores entirely, allowing them to personalise their shoppers’ experiences. Rakuten’s strapline is ‘Shopping is entertainment!’ Mikitani likes exclamation marks!
I think Rakuten will continue to grow, so Mikitani’s philosophy is worth studying. Let’s look at a few strands.
Mikitani is driving all Rakuten operations globally to work entirely in English – even at home in Japan. Now, a global English speaking culture is not surprising in many of the large global corporates, headquartered in the US, but Rakuten is Japanese owned and managed. So this is a big deal that has attracted criticism and scorn from some of Mikitani’s peers among Japanese business leaders. His response is to say ‘English is not an advantage anymore – it is a requirement.’ He believes the friction in doing business between different Rakuten offices around the world is so reduced that it makes the policy the right one – even at the cost of not promoting non-English speaking corporate staff.
Readers may have barely heard of Rakuten, but you may well know some of the names it has acquired in its rapid global expansion. Mikitani seems bent on globalising his business and dominating online retailing. And one of Rakuten’s five principles for success is ‘Speed!! Speed!! Speed!!’ The double exclamation marks are theirs, not mine.
Mikitani has a real sense of mission about his desire to allow businesses to trade in the way they choose, rather than creating a corporate template for everyone to conform to. His Business-to-Business-to-Consumer (B2B2C) model pre-dates Amazon’s use of its marketplace and FBA trading, and sticks resolutely to his original vision of boutique trading.
The Web as the Bazaar
Perhaps the strongest indication of Mikitani’s commitment to global web commerce is the announcement, in March 2015, that Rakuten will soon accept Bitcoin across all of its global marketplaces. This involves a massive investment in Bitnet, a startup payment system that Rakuten will start by integrating into its U.S. marketplace to allow customers to pay in Bitcoins.