Q #25: What is a “mutual gains approach” to negotiation?

In this series, Bob Morris poses a key question and then responds to it with material from one or more of the business books he has reviewed for Amazon and Borders.The term was coined by Hallam Movius and Lawrence Susskind and is explained in their recently published book, Built to Win: Creating a World-Class Negotiating Organization. They make several important distinctions between individual negotiating skills and organizational negotiating capacity, explaining why they are quite different. They insist that what they call a “mutual gains approach” to negotiation must be a core process to produce measurable and continuous improvement at all levels and in all areas of an organization. In any organization, in fact, there are hundreds (if not thousands) of negotiations of one kind or another conducted between and among everyone involved in the value chain (e.g. supervisors, other workers, customers, competitors, vendors, strategic allies, media).

Here is the formal infrastructure of the “mutual gains approach” to negotiation:

1. Prepare by clarifying your mandate and defining your team; by estimating best alternatives to negotiated agreements (BATNA), yours as well as theirs; by knowing your own interests and objectives, and think about theirs; by improving your BATNA (if possible); and by preparing to suggest mutually beneficial options.

2. Create value by reducing (if not eliminating) criticism; by “inventing without committing”; by generating options that exploit differences; and by bundling options into multiple packages.

3. Distribute value by behaving in ways that build trust; identifying standards/criteria for dividing (sharing, allocating) value that all sides can support; by keeping at least two packages in play; and but using neutrals to suggest possible distributions.

4. Follow through by designing nearly self-enforcing agreements; by specifying mechanisms to deal with “predictable surprises”; by agreeing on monitoring arrangements, including metrics; and by continuously and actively working to improve relationships.

This is obviously a much more formalized version of what Carl Rogers recommended decades ago. When negotiating, focus on three areas: issues on which there is agreement, less important issues of disagreement, and more important issues of disagreement. Then, set aside all issues on which there is agreement; negotiate concessions with regard to the less important issues (i.e. “win a few and lose a few”); devote the bulk of your time and energy to resolving the most important differences.

Comments, questions, requests, or suggestions? Please share them. They will be most welcome and I thank you for them. Best regards, Bob

Q #24: What is an “open business model”?

In this series, Bob Morris poses a key question and then responds to it with material from one or more of the business books he has reviewed for Amazon and Borders.

Henry Chesbrough is generally credited with devising (or at least formalizing) this especially important concept. In his two major works, Open Business Models: How to Thrive in the New Innovation Landscape (2003) and Open Innovation: The New Imperative for Creating and Profiting from Technology (2006), he explains that a business model “performs two important functions: it creates value and it captures a portion of that value. It creates value by defining a series of activities from raw materials through to the final consumer that will yield a new product or service with value being added throughout the various activities. The business model captures value by establishing a unique resource, asset, or position within that series of activities, where the firm enjoys a competitive advantage.” Having thus established a frame-of-reference, Chesbrough continues: “An open business model uses this new division of innovation labor – both in the creation of value and in the capture of a portion of that value. Open models create value by leveraging many more ideas, due to their inclusion of a variety of external concepts. Open models can also enable greater value capture, by using a key asset, resource, or position not only in the company’s own business model but also in other companies businesses.”

Given the complexity and potential importance of an open business model, I presume to extend the length of this response somewhat by suggesting:

1. When designing and implementing an “open” business model, the first requirement is that everyone involved has both an “open” mindset (i.e. receptive to new ideas, whatever their source may be) and is not only willing but also eager to collaborate with others within and beyond her or his own organization. So-called “conventional wisdom” is often a justification for defending the status quo.

2. When setting objectives, focus on the most serious problems to solve and on the most important questions to answer.

3. With regard tracking progress, measure only what really matters…and do so with accuracy and consistency. Meeting deadlines, for example, as well as first-pass yield and cycle time. Be especially alert for variances.

4. Have “open” communication, cooperation, and collaboration at all levels and in all areas throughout what should be viewed as an extended enterprise. There is so much of value to be learned from associates, of course, (especially in other departments), but also from customers, vendors, strategic allies, and other stakeholders within the given value chain. Moreover, Chesbrough cites examples of situations in which valuable information was obtained (legally) from competitors.

5. Open Innovation is a journey of discovery. Therefore, view all problems as learning opportunities. Focus on determining their root causes rather than merely responding to their symptoms.

You may wish to check out this Web site:

http://www.openinnovation.net

Comments, questions, requests, or suggestions? Please share them. They will be most welcome and I thank you for them. Best regards, Bob

Q #23: Which are the best questions to ask when meeting with a prospective client for the first time?

In this series, Bob Morris poses a key question and then responds to it with material from one or more of the business books he has reviewed for Amazon and Borders.

Andrew Sobel is the author of All for One: 10 Strategies for Building Trusted Client Relationships. In it, he offers excellent advice. For example, which are the best questions to ask when meeting with a prospective client for the first time?

1. What is the most valuable way we can spend this time together?

2. What are you most curious to know about me [or my firm]?

3. What is most important for me to know about your company?

4. How is your company reacting to [a recent and major development in its industry, competitive marketplace, etc.]?

5. Which of your competitors do you admire most? Why?

6. What do your competitors most admire about your company? Why?

7. What is the single greatest opportunity does your have in the next 6-12 months?

8. What are the greatest challenges your customers now face?

9. What specifically is your company doing to help them respond to them?

10. If I [or my firm] were to have the privilege of working with you, on what would you want me [us] to concentrate immediately?

Here is a link to Sobel’s Web site: http://www.andrewsobel.com/

Comments, questions, requests, or suggestions? Please share them. They will be most welcome and I thank you for them. Best regards, Bob

Q #22: What are the most basic fallacies?

In this series, Bob Morris poses a key question and then responds to it with material from one or more of the business books he has reviewed for Amazon and Borders.

Here’s a “baker’s dozen” of troublemakers:

Begging the Question: Restates assertion as a conclusion
Red Herring: Distracts with irrelevancies
Non Sequitur: Literally, “does not follow”
Stacked Evidence: Presents only one of two (or several) sides
Either/Or: Offers only two choices when in fact there are several
Post Hoc: Asserts a faulty cause-and-effect relationship
Hasty Generalization: Leaping to conclusion unsupported by evidence
Ad Hominem: Attacks a person rather than her/his argument, qualifications, etc.
Guilt by Association: Asserts that one’s value (e.g. character) is determined by one’s associations
Irrelevant Authority: “They say….”
Bandwagon: “Everyone else is doing it.”
Slippery Slope: Scare tactic (“If you don’t….”)
NOTE: Also called Fear of God (FOG) fallacy.
Citing a False Imperative: “This must be done” rather than “This could be done”

The best sources for improving one’s ability to reason more effectively and make better judgments include Robert Cialdini’s Influence: The Psychology of Persuasion, Roger Martin’s The Opposable Mind: How Successful Leaders Win Through Integrative Thinking, and Judgment: How Winners Make Great Calls co-authored by Noel Tichy and Warren Bennis.

Comments, questions, requests, or suggestions? Please share them. They will be most welcome and I thank you for them. Best regards, Bob

Q #21: How to generate great ideas?

In this series, Bob Morris poses a key question and then responds to it with material from one or more of the business books he has reviewed for Amazon and Borders.

Predictably, opinions vary about the process but all experts agree that there must be a lot of ideas to get a few good ideas and a lot of good ideas to get a few excellent ideas and then (you guessed it) a lot of excellent ideas to get one or (maybe) two “insanely great ideas” as Steve Jobs characterizes them. I’ve just read a book by Gerald Sindell, The Genius Machine: The 11 Steps That Turn Raw Ideas into Brilliance, that may be of interest and value. He shares his insights about thinking “that is directed toward improving an existing idea, thinking through a complete issue, or creating something new.” The eleven “steps” to which the subtitle refers are in a sequence devised by Sindell. He devotes a separate chapter to each. They are: Distinctions, Identity, Implications, Testing, Precedent, Need, Foundation, Completion, Connecting, Impact, and Advocacy. Obviously, the sequence suggests a specific process by which to subject an existing idea to rigorous and relentless pressure, to a “crucible” of scrutiny and evaluation.

So, the best way to generate great ideas is to generate lots of ideas, then lots of good ideas, and then lots of excellent ideas (subjecting each to a process such as the one Sindell advocates) and hope that eventually one or two great ideas survive that process. There are other sources worth checking out, notably Tom Kelley’s two books (The Art of Innovation and The Ten Faces of Innovation) in which he explains the brainstorming process at IDEO, a design and innovation firm based in Palo Alto that he and his brother David founded in 1991. With regard to generation of ideas, I also recommend Tim Hurson’s Think Better: An Innovator’s Guide to Productive Thinking and Making Innovation Work: How to Manage It, Measure It, and Profit from It co-authored by Tony Davila, Marc J. Epstein, and Robert Shelton.

It is important for everyone involved to remember, including CEOs and other senior managers, is that the process of generating and evaluating ideas, and then (perhaps) producing one or two great ideas inevitably involves lots of failure, is messy and frustrating, takes time, and requires sustained support. Potentially great ideas are like seedlings. They do not respond well to being pulled out of the ground to see how well they’re doing.

Comments, questions, requests, or suggestions? Please share them. They will be most welcome and I thank you for them. Best regards, Bob

Q #20: With regard to what the mind is and does, which recently published books have you found most interesting?

In this series, Bob Morris poses a key question and then responds to it with material from one or more of the business books he has reviewed for Amazon and Borders.

Quite a few, actually. For example, John Ratey‘s Spark: The Revolutionary New Science of Exercise and the Brain. With Eric Hagerman, Ratey has written a book in which he explains — in layman’s terms (to the extent that is possible) — how physical exercise can “supercharge [provide a 'spark' to] mental circuits to avoid or overcome stress, sharpen thinking, lift mood, increase memory…and much more.” Obviously, these are all highly desirable results to achieve.

Another is John Medina’s Brain Rules: 12 Principles for Surviving and Thriving at Work, Home, and School. In the Introduction, he expresses his concern that most people are “out of the loop” in that they are unaware of recent and important revelations in modern neuroscience concerning how the mind works. “Easily the most sophisticated information-transfer system on Earth, your brain is fully capable of taking little black squiggles on this piece of bleached wood [i.e. ink on paper] and deriving meaning from them. To accomplish this miracle, your brain sends jolts of electricity crackling through hundreds of miles of wires composed of brain cells so small that thousands of them could fit into the period at the end of this sentence. You accomplish all this in less time than it takes you to blink. Indeed, you have just done it. What’s equally incredible, given your intimate association with it, is this: Most of us have no idea how our brain works.”

It is worth noting that everything that Ratey recommends is consistent with the various “rules” that Medina identifies and discusses, notably #1 (“Exercise boosts brain power”), #7 (“Sleep well, think well”), #8 (“Stressed brains don’t learn the same way”), #9 (“Stimulate more of the senses”), and #12 (“We are all natural explorers”). How simple it seems: Eat right and get lots of exercise and sufficient rest. If you do, you will reduce stress and nourish your curiosity. To many of us, the obvious is often invisible until we are enlightened by others such as John Ratey and John Medina.

Here is Ratey’s Web site: http://www.johnratey.com/newsite/index.html

Here is Medina’s Web site: http://www.brainrules.net/

Comments, questions, requests, or suggestions? Please share them. They will be most welcome and I thank you for them. Best regards, Bob

Q #19: How do you read a business book?

In this series, Bob Morris poses a key question and then usually responds to it with material from one or more of the business books he has reviewed for Amazon and Borders. What follows is based on the strategies he has used for many years.

Most of us are taught to read phonetically. In fact, the speed of light is far greater than the speed of sound. (The speed of sound is 767 mph whereas the speed of light is 670,616, 629 mph.) The eye is a muscle that, like all other muscles, requires frequent and disciplined exercise. For the past 15 years, I have completed several times each day a series of exercises (each takes about five seconds) that strengthen my eyes. Now, when I read almost anything (except legal documents and poetry), my eyes seem to “fly” through the text, top to bottom. Comprehension and retention seem to be determined by intelligence and prior knowledge. That is, you either “get it” or don’t. Final observation: In high school, college, and then graduate school, I was an impatient reader. I felt slowed down by “something.” I felt that I was reading in slow motion, running in waist-high water or on soft sand, etc. Then I learned about research in the joint fields of optics & neurology at UCLA, obtained some information, and modified some of the “eye strengthening” exercises and devised a few others. Believe it or not, this really is a “relatively brief explanation”!

How do I read a business book?

1. First, the title and subtitle, then
2. The table of contents
3. Then the preface and/or introduction
4. Finally, skim-read the first 2-3 chapters to become familiar with the format

On average, this process takes 10-15 minutes. At this point, I decide whether or not to read the entire book. If my decision is affirmative, then as I begin to read each chapter, I skim-read in the sense that I proceed from one bold face heading to the next, then go back and read the chapter word-for-word. When I get to the last chapter, I read and then immediately re-read it. If there are appendices, I also read them.

Along the way, I highlight key passages. On average, this process takes 45-60 minutes.

Comments, questions, requests, or suggestions? Please share them. They will be most welcome and I thank you for them. Best regards, Bob

Q #18: Why do some ideas “stick” but most don’t?

In this series, Bob Morris poses a key question and then responds to it with material from one or more of the business books he has reviewed for Amazon and Borders.

In Made to Stick: Why Some Ideas Survive and Others Die, Chip Heath and his brother Dan examine an especially important challenge to everyone who struggles to formulate and then communicate ideas that “stick”: That is, ideas that “are understood and remembered, and have a lasting impact – they change your audience’s opinions or behavior.” Extensive research indicates that each of us receives several thousand messages each day from various print and electronic media as well as from those with whom we interact. These competing messages create “clutter” that is increasingly more difficult to penetrate. I wholly agree with the Brothers Heath that, contrary to what many people may believe, almost anyone can craft ideas that make a difference. “And that’s the great thing about the world of ideas – any of us, with the right insight and the right message, can make an idea stick.” In this volume, the Heaths share all they have learned about how to do that. To paraphrase Henry Ford, whether you think you can or think you can’t produce sticky ideas…you’re right.

Here is a helpful checklist:

Simplicity: Albert Einstein once observed, “Make everything as simple as possible but no simpler.”

Unexpectedness: People delight in pleasant surprises. More to the point, they notice them. This is what Seth Godin has in mind when discussing “purple cows” that attract attention because they are remarkable…at least for a while.

Concreteness: Ludwig Mies van der Rohe once suggested, “God is in the details.” The Brothers Heath urge writers to provide compelling details, not vague abstractions.

Credibility: Unless people trust you (i.e. your integrity, your ability, your knowledge, your reliability), only your lack of credibility with “stick.”

Emotions: If you don’t capture the heart, the mind will remain inaccessible behind barriers that resemble Teflon.

Stories: Anchor ideas in unforgettable human experiences.

You may wish to check out Robert McKee’s Story: Substance, Structure, Style and The Principles of Screenwriting as well as Gary Klein’s Sources of Power: How People Make Decisions and more recent The Power of Intuition: How to Use Your Gut Feelings to Make Better Decisions at Work.

Comments, questions, requests, or suggestions? Please share them. They will be most welcome and I thank you for them. Best regards, Bob

How can I improve my communications skills?

In this series, Bob Morris poses a key question and then responds to it with material from one or more of the business books he has reviewed for Amazon and Borders.

In The Art of War, Sun Tzu asserts that every battle is won or lost before it is fought. Hence the importance of preparation and that is also true of effective verbal and written communications. The experts agree that the most effective communicators are those who (a) have specific objectives to achieve, (b) know the needs and interests of those with whom they are communicating, (c) are knowledgeable about the given subject (i.e. have credibility), and (d) focus on at least three but no more than five key points, with the second most important point made first and the most important point made last.

When I was teaching English in schools and colleges, and later when I began to conduct workshops for corporate executives, I used an acronym I call “EDNA” based on Aristotle’s four levels of discourse:

Exposition: Explain with information using strategies that include classification (organization), process analysis (step-by-step), comparison (similarities), contrast (differences), analysis (separation), causal relationship,

Description: Make vivid with compelling details

Narration: In fiction, tell a story with a plot; in non-fiction, explain a process or sequence with specific information

Argumentation: Convince with logic (i.e. deduction or induction) and/or evidence (e.g. documentation with redundant verification)

The best sources on writing include William Zinnser’s On Writing Well (30th Anniversary Edition): The Classic Guide to Writing Nonfiction, Stephen King’s On Writing (a book whose generous provision of practical advice surprised me, frankly), William Strunk and E.B. White’s The Elements of Style, and any of George Orwell’s essays, notably “Politics and the English Language” and “Shooting an Elephant.”

Comments, questions, requests, or suggestions? Please share them. They will be most welcome and I thank you for them. Best regards, Bob

Q #16: In a business context, what is a “catalyst”?

In this series, Bob Morris poses a key question and then responds to it with material from one or more of the business books he has reviewed for Amazon and Borders.

This is brilliantly discussed in two books I recently reviewed, Ori Brafman and Rod Beckstrom’s The Starfish and the Spider: The Unstoppable Power of Leaderless Organizations and The Catalyst: How You can Become an Extraordinary Growth Leader co-authored by Jeanne Liedtka, Robert Rosen, and Robert Wiltbank. Here are two excerpt composites:

“A catalyst’s most important relationships are based on trust and understanding. [Every time they] have a conversation with someone they’re actively thinking, How can I help this person? Who can I introduce this person to? I just want to help this person, I just want to make this person better…They have a genuine interest in others. They thrive on meeting and helping new people every day. They have a host of acquaintances. Catalysts think of who they know, who those people know, how they all relate to one another, and how they fit into a huge mental map. [Catalysts] inspire change without being coercive. [They serve as] an inspiration to others to work toward a goal that often doesn’t involve personal gain. Perhaps the most difficult and counter intuitive element of being a catalyst is [doing everything possible to help others and then] getting out of the way.” Brafman and Beckstrom

“Catalysts drive action. But there’s more. In science the term catalyst refers specifically to an agent that is required to activate a particular chemical reaction. In other words, chemical catalysts don’t just make things happen; they make things happen that wouldn’t happen at all without them. They accomplish this by reducing the barriers that would, under normal circumstances, prevent a reaction. That is exactly how the growth leaders – our corporate catalysts – overcame growth gridlock [i.e. an entrepreneurial initiative is neutralized by administrative skepticism] and the terror of the plug [i.e. an arbitrary, often unrealistic revenue target] in their organization…Catalysts crack the growth code by ignoring Corporate’s obsession with analysis and size. …They stage a daring escape from the tyranny of data [and what James O’Toole characterizes as ‘the ideology of comfort’]…They believe that small can be beautiful, as long as the business doesn’t stay small for long. Scalability is very important to them…[They] see themselves as having the best of both worlds: building a new business and controlling the existing one.” Liedtka, Rosen, and Wiltbank

Comments, questions, requests, or suggestions? Please share them. They will be most welcome and I thank you for them. Best regards, Bob