Executive Times

Volume 10, Issue 2

February 2008

2008 Hopkins and Company, LLC

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Distraction

2008 started with a dramatic roller coaster ride for global stock markets and queasy stomachs for executives trying to maintain a semblance of calm about the uncontrollable. The presidential political campaign produced no clear frontrunners, and that has led to increased negative campaigning and sharp elbow debating to put candidates on the defensive. It’s always tough for executives to remain focused and stay on message. Some of the distractions can involve real crises; others can come from temporary irritants like the unanticipated actions of markets, competitors and customers. The most effective executives decide rapidly whether new things are game-changing or not, and adapt quickly. By constantly returning to fundamentals, and by trying to get to the essence of an issue, the best executives select the most effective steps to take when facing new challenges. This issue selects some recent examples of distractions and how some executives are dealing with them. As you think about these stories, examine the ways in which you and those who work with you deal with the roller coasters and non-essential distractions that can be barriers to success. Decide how you will lead a way out of the energy and time wasting things that distract from productivity and achievement.

Fifteen new books are rated in this issue, beginning on page 5. One book received a highly recommended four-star rating; nine books are rated three-stars; four books received two-star ratings; and one book eked out a one-star recommendation. Visit our current bookshelf at http://www.hopkinsandcompany.com/2008books.html and see the rating table explained as well as explore links to all 196 books read or those being considered this year, including 31 that were added to the list in January. If there’s something missing from the bookshelf that you think we should be considering or if there’s a book lingering on the Shelf of Possibility that you think we should read and review sooner rather than later, let us know by sending a message to books@hopkinsandcompany.com. You can also check out all the books we’ve ever listed at http://www.hopkinsandcompany.com/All Books.html.

Creation

Leading innovation can drive some executives to distraction. Managing huge change initiatives can become overly disruptive, and some efforts can be abandoned when the economy provides revenue challenges. The 1Q2008 issue of The McKinsey Quarterly has a useful article titled, “Leadership and Innovation,” (http://www.mckinseyquarterly.com/Leadership_and_innovation_2089_abstract) that may help. Here are some suggestions: “Define the kind of innovation that drives growth and helps meet strategic objectives. … Add innovation to the formal agenda at regular leadership meetings. … Set performance metrics and targets for innovation. … Embrace innovation as a top team. … Turn selected managers into innovation leaders. … Create opportunities for managed experimentation and quick success.” The article also describes some of the barriers to innovation, and contains insights gleaned from surveys of executives.

How well are you, those who report to you, and your organization doing when it comes to innovation? How important is innovation to your future? How do you measure the successful execution of innovation?

Innate
Matching people and jobs can be both the best and worst part of an executive’s job. When done well, the outcome is usually harmony and success. When done poorly, there’s distraction, confrontation and failure. We read a perspective about talent in the current issue of the Gallup Management Journal titled, “Understanding the Nature of Talent,” (http://gmj.gallup.com/content/103543/Understanding-Nature-Talent.aspx) that may help unravel some ways in which matching people and jobs can improve. The article is an excerpt from a book titled, “Human Sigma: Managing the Employee-Customer Encounter,” by John H. Fleming and Jim Asplund. Instead of a cyclical approach of replacing struggling employees with better ones, the authors propose, “an approach based on an understanding of employee talents and how it can be used to reliably hire new employees in a way that obviates the need for regular purges. When we talk about ‘talent,’ we mean those natural tendencies that exist deep within us. These are the aspects of our personality or behavior most resistant to change. … Our research shows that some traits do not change much over time. … In hiring and managing individual employees, it's important to understand what is difficult to change (talent) and what is more easily changed or acquired (knowledge and skills). Once you hire someone, you are largely stuck with their talents, whereas you can still impart new skills and knowledge. Without a clear understanding of these two different aspects of ability, you will have an incomplete picture of how talents play into hiring decisions and could become more prone to making hiring errors. … No reasonable amount of training or hard work will likely ever make up for the performance gap that can be attributed to having talents that fit the job. It has been our experience that more talented individuals also learn and adapt faster in situations that fit their talents, so it is likely that additional training and experience will instead widen the performance gap between those with talent and those without. Understanding the talent requirements of a given job makes it much easier to hire candidates that are likely to succeed in those circumstances. It also helps clarify existing employees’ perceptions of the role and the extent to which those perceptions match who they are as individuals. If the role is a good fit talent-wise, then any deficits in performance are likely the result of a lack of skills, knowledge, or experience, all of which can be changed with relative ease. If the role is a poor fit, then deficits in performance may be difficult to overcome, and the employee should find a more suitable position. The final judgment in these cases should always be the employee's performance. There are many routes to success; talent assessments merely find the most common ones associated with excellence and raise the odds of high performance. This is the best way to think about talent -- as one factor among others, including experience, skills, and knowledge.” Read the full article and think about your challenges in matching people and jobs.

How do you determine the talent that’s needed to perform specific jobs in your organization? How well are you matching people and jobs? What does turnover or performance glitches tell you about the ways in which you are selecting people for jobs?

Poof

Everybody has aspects of our jobs that we wish someone else would do. Those with skilled direct reports can give broad direction, and are thrilled when an assignment comes back that matches expectations. Sometimes wasted hours are spent by executives doing PowerPoint slides themselves, or spending endless time on e-mail or finding out information through Google. In an article titled “Scuttling Scut Work” (http://www.fastcompany.com/magazine/122/scuttling-scut-work.html) Fast Company examined this situation in their February issue, Following a 10% workforce reduction in 2005, Pfizer decided to explore ways in which employees could be productive in their own jobs by having someone else do repetitive tasks or do research while the employee does something else. They created what they call OOF: Office of the Future. According to Fast Company, Pfizer’s senior director of organizational effectiveness, Jordan Cohen, “…was reading Thomas Friedman's The World Is Flat, which profiles India's virtual-assistant companies. After analyzing the activities of Pfizer employees, he learned that they spend 20% to 40% of their time on four activities: creating documents, manipulating and analyzing spreadsheets, scheduling meetings, and researching. So he called the companies in Friedman's book. Could they do this stuff? He found hundreds of operations, many with thousands of employees, specializing in so-called knowledge-process outsourcing--dealing with information and data. He rounded up 30 adventurous souls at Pfizer for a test-drive with four employees at OfficeTiger in Chennai. The initial test run didn't work well. Assignments came back unusable, sometimes marred with typos, and with data incorrectly analyzed. Cohen realized that the problem stemmed from Pfizer employees not specifying what they ultimately needed, and the Indian companies struggling with multistep projects. … OfficeTiger proposed a team system, putting a dozen skilled workers in one room and passing the project around repeatedly. ‘I didn't think it would work,’ Cohen says. ‘There were too many handoffs.’ But it did work, and the pilot took off. Word spread through Pfizer's towers, until the program included 200 employees. Meanwhile, Cohen worked to create a simple interface; now, when a Pfizer employee clicks the OOF button in Microsoft Outlook, a single triage worker in India receives the request and assigns it to a team, and the team leader calls the employee to clarify the larger purpose. The team leader then sends back an email specifying the cost. ‘At this point, the Pfizer employee can say yes or no,’ Cohen says. ‘That's the ultimate measure: Is this research project worth $750?’ The verb ‘OOFable’ entered the lexicon of Pfizer's pilot users.” Starting this month, 10,000 Pfizer employees can use OOF. “For OOF services, Pfizer pays $15 to $35 per worker hour, far less than they'd pay the McKinseys of the world, whose rates typically start at $215 per hour. Pfizer is alone in rolling out a large-scale knowledge-outsourcing program, but many companies are experimenting within individual departments.”

What time wasters cost you and your organization too much because of the way you currently do them? Can you outsource those things and save money as a result? How much does a PowerPoint slide cost when you prepare it yourself? Is there an OOF button you can press to get someone else to work on something for you?

Refreshing

Another way to consider distractions is to choose them. There’s nothing like a short break to clear the head. The Internet provides an almost endless array of possible distractions. Here’s one site to consider: www.bigthink.com. The creators of this site call it a “You Tube for Ideas.” Through video interviews with broad range of thinkers, participants can listen, think, and engage with each other on big questions. It’s a place to go to listen to someone who knows more than you do, or someone whose point of view differs from yours. What could be more distracting and refreshing than that? The site defines its mission as follows: “Our task is to move the discussion away from talking heads and talking points, and give it back to you. That is Big Think's mission. In practice, this means that our information is truly interactive. When you log onto our site, you can access hundreds of hours of direct, unfiltered interviews with today's leading thinkers, movers and shakers. You can search them by question or by topic, and, best of all, respond in kind.” We read about this site in an article in the January 7 edition (http://www.nytimes.com/2008/01/07/technology/07summers.html) of The New York Times, where you can learn more.

What distractions do you desire? With whom do you engage on life’s big questions? What gets you back to work?

Follow-up

Here’s an update on stories covered in prior issues of Executive Times:

Ø In a moment of weakness, we gave a hard time in the August 2007 issue of Executive Times to both the Emperor Nero and to Bear Stearns’ James E. Cayne when we stated that if we had a Nero award we would give it to Cayne for playing golf so frequently while Bear’s hedge funds were melting down. Astute readers pointed out that Nero neither golfed nor fiddled around while Rome burned. Cayne announced recently that he will step down as Bear’s CEO. Here’s part of the announcement: ‘“Jimmy has much to be proud of -- under his leadership Bear Stearns has grown substantially over the past 15 years, with revenues increasing to $7 billion from $2 billion and the number of our employees more than doubling to 14,000,’ said Vincent Tese, Bear Stearns lead independent director. ‘This was his decision, and we are very pleased that he has agreed to stay actively involved in the business as chairman of the board.”’ Fore.

Ø In some prior years, we’ve noted Fortune’s annual list of the 100 Best Companies to Work For. Here’s a link to the current list: http://money.cnn.com/magazines/fortune/bestcompanies/2008/. One interesting observation: employees at these companies are more satisfied with their pay today than they were ten years ago.

Legacy

Unwinding
The last salesman to lead Sears Roebuck and Company, Edward Brennan, died in late December at age 73. He looked like the CEO from central casting. His demeanor was measured, his comments steady, and his smile was engaging. He got things done. He also had to play the hand that was dealt to him. Over the course of the thirty years prior to his becoming CEO in 1986, his predecessors embarked on a strategy to create a full service enterprise, a one-stop shopping experience for consumer goods as well as an array of financial services. Some wags said they wanted consumers to buy their stocks where they bought their socks. When Brennan took over the company, its prospects looked outstanding, thanks, in part, to his acquisition of Dean Witter and Coldwell Banker when he headed the retail operation. He introduced the Discover card, which became an immediate success. On Brennan’s watch, the diversification strategy fell out of favor. Specialty retailers picked away at all aspects of the company’s retail consumer sales. The company’s stores were usually located in malls, while shoppers were gravitating to the strip centers where big box specialty companies were dominant. Multiple attempts to revive the retail business all failed to turn the problems around. Under pressure from shareholders, Brennan cut costs, changed strategy, and sold off many parts of the company, including those he played a major part in assembling. The company vacated the Sears Tower. By the time Brennan stepped down as CEO in 1995, Sears was renovating stores, and trying hard to recover its past success. Brennan didn’t create the problem of having the wrong stores in the wrong place at the wrong time, but it was up to him to make the best of it. He did all he could to unwind the diversification strategy, and he left it to his successors to succeed as a revitalized retailer. They are still trying, while some competitors are looking for ways to diversify.

Latest Books Read and Reviewed:

(Note: readers of the web version of Executive Times can click on the book covers to order copies directly from amazon.com. When you order through these links, Hopkins & Company receives a small payment from amazon.com. Click on the title to read the review or visit our 2008 bookshelf at http://www.hopkinsandcompany.com/2008books.html).

Title (Link to Review)	Author	Rating	Review Summary	Purchase
The Rake	Buckley, Jr., William F.	**	Uncaring. Could be a relaxing respite from the 2008 presidential campaign to read this novel of a candidate’s secret, if you can tolerate weak character development and feeble plot.
Starbucked: A Double Tall Tale of Caffeine, Commerce and Culture	Clark, Taylor	***	Ubiquity. The growth of Starbucks has changed many communities and individuals. Taylor explores many of the ways in which these changes aren’t for the better. Have an espresso as you read and decide whether you agree or disagree.
God Is Dead	Currie, Jr., Ron	**	Satire. In this debut novel of connected stories, God comes into the world as a Dinka woman who dies in the Darfur region of Sudan. What follows is even darker in this finely written satire.
American Creation	Ellis, Joseph J.	***	Ambiguity. Skilled historian relates six stories from 1775-1803 highlighting both the success and failure of the ways the Founders dealt with issues and with ambiguity.
New Bedlam	Flanagan, Bill	**	Disorder. Novel uses the backdrop of a family owned cable television network to play out family issues in this humorous novel that has a slow and steady plot.
How Starbucks Saved My Life	Gill, Michael Gates	***	Upbeat. Fine writing presents an upbeat rather than maudlin story of how a fired executive, newly divorced, broke and diagnosed with a brain tumor, finds a path ahead through his entry level job at Starbucks.
The Ghost	Harris, Robert	***	Recruited. A ghostwriter is recruited to complete on a short deadline the memoirs of a recently retired British prime minister. The plot moves quickly and the characters are both interesting and complex.
Triple Homicide	Hynes, Charles	*	Annoying. Debut crime novel by Brooklyn D.A. reads like it was written by a district attorney. Murders, police corruption, lots of description, weak dialogue and tedious exposition.
Amish Grace: How Forgiveness Transcended Tragedy	Kraybill, Donald B., Steven M. Nolt, and David L. Weaver-Zercher	***	Forgiveness. Three teachers collaborate to explain to outsiders how after ten children were shot and five killed in Nickel Mines, Pennsylvania, the members of the Amish community forgave the shooter.
Blonde Faith	Mosley, Walter	***	Dependable. Another Easy Rawlins mystery with a well-structured plot, fine dialogue and keen insight into human nature. Mosely can be counted on to deliver reading pleasure.
Last Night at the Lobster	O’Nan, Stewart	***	Working. Finely written novel about the closing of a Red Lobster restaurant with insights into working and managing. Protagonist Manny DeLeon is a manager that any company would want to hire.
In Defense of Food	Pollan, Michael	****	Pleasure. Author kept getting questions about what to eat from readers of The Omnivore’s Dilemma. This book answers: Eat food. Not too much. Mostly plants. Read it and bring some pleasure to your diet.
McIlhenny's Gold: How a Louisiana Family Built the Tabasco Empire	Rothfeder, Jeffrey	***	Hot. Turns out there’s quite a colorful and interesting story behind the family that has made the sauce in those Tabasco sauce bottles since 1869. Give this one a taste.
Bridge of Sighs	Russo, Richard	***	Passion. Over 500 well-written pages of how an interesting ensemble of characters lives life to the fullest, in a small town and elsewhere.
The Almost Moon	Sebold, Alice	**	Madness. Novel in which a woman kills her 88-year-old senile mother. An exploration of the mother-daughter relationship, mental illness and irrationality.

2008 Hopkins and Company, LLC. Executive Times is published monthly by Hopkins and Company, LLC at the company’s office at 723 North Kenilworth Avenue, Oak Park, Illinois 60302. Subscription rate for first class mail delivery of the print version is $60.00 per year (12 issues). Web version subscriptions are $30.00 per year. Single issues: $10.00 print; $5.00 web. To subscribe, sign up at www.hopkinsandcompany.com/subscribe.html, send an e-mail to executivetimes@hopkinsandcompany.com, call (708) 466-4650, or fax to (708) 386-8687. For permission to photocopy or e-mail Executive Times, call (708) 466-4650 or e-mail to reprints@hopkinsandcompany.com. We will send sample copies if requested. The company’s website at http://www.hopkinsandcompany.com/archives.html contains the archives of back issues beginning in the month after the issue date.

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