Spreadable Media: A book review by Bob Morris

Spreadable Media: Creating Value and Meaning in a Networked Culture
Henry Jenkins, Sam Ford, and Joshua Green
New York University Press (2013)

The significance of the shift from a culture shaped by traditional media toward one fostering greater grassroots participation

First of all, I want to commend Henry Jenkins, Sam Ford, and Joshua Green on their 46-page Introduction that, all by itself, is worth more than the cost of the book while “setting the table” for an even more substantial feast of information, insights, and counsel in the seven chapters that follow.

As they explain, their book “examines the emerging hybrid model of [content] circulation, where a mix of top-down and bottom-up forces determine how material is shared across and among cultures in far more participatory (and messier) ways…This shift from distribution to circulation signals a movement toward a more participatory model of culture, one which sees the public not as simply consumer of preconstructed messages [e.g. book reviews of this book] but as people who are shaping, sharing, reframing, and remixing media content in ways which might not have been previously imagined.”

In this context, I am reminded of Henry Chesbrough and the open business model for which he is so widely and justifiably renowned. As he explains in Open Innovation (2005), “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.”

In their book, Jenkins, Ford, and Green focus on the “social logics and practices that have enabled and popularized [social media’s] new platforms, logics that explain why sharing has become such a common practice, not just how .” The terms “spread,” “spreadable,” and “spreadability” are indeed appropriate, given the almost unlimited opportunities for communication, cooperation, and collaboration that an open business model creates for social media. The potentialities – both technical and cultural — for connection and interaction are there to be seized by those who recognize and then take full advantage the increasingly pervasive forms of media circulation.

These are among the dozens of passages that caught my eye, also listed to suggest the scope of coverage.

o What Susan Boyle Can Teach About Spreadability (Pages 9-16)
o Toward a New Moral Economy, Stolen Content or Exploited Labor, and Engaged, Not Exploited? (52-61)
o Value, Worth, and Meaning (67-72)
o Toward Transparent Marketing, and, We don’t Need Influencers (75-82)
o Systems of Appraisal (87-90)
o From the Residual to the Retro, and, Residual Economics (100-106)
o Are You Engaged? and, The Challenges of Measurement (116-126)
o “The Total Engagement Experience” (137-141)
o A Brief History of Participatory Culture, and, Resistance versus Participation (159-172)
o Hearing versus Listening (175-182)
o The Problem of Unequal Participation (188-194)
o The Uncertainty Principle (196-202)
o How Long Is the Long Tail? (238-242)
o Learning from Nollywood (265-270)
o The World Is Not Flat (284-290)
o Spreadability Focal Points (295-300)

Before concluding their brilliant book, Jenkins, Ford, and Green identify a number of issues about a spreadable media environment that remain unresolved. For example, “If, for many of us, the long-term goal is to create a more democratic culture, which allows the public a greater role in decision-making at all levels, then a key requirement is going to be timely access to information and transparency in decision-making.” Governance issues, especially regulation within a global digital community, suggest major implications for both better or worse.

However, Henry Jenkins, Sam Ford, and Joshua Green observe, “For the foreseeable future, these issues will be under debate between and among all participating parties. The shape of our culture, thank goodness, is still under transition, and – as a consequence – it is still possible for us to collectively struggle to shape the terms of a spreadable media environment and to forge a media environment that is more inclusive, more dynamic, and more participatory than before.” I share that hope and am encouraged by the fact that achieving that vision would not have been possible only a few years ago.

I realize that no brief commentary such as mine can do full justice to the material that is provided in this volume but I hope that I have at least suggested why I think so highly of it. Also, I hope that those who read this commentary will be better prepared to determine whether or not they wish to read the book and, in that event, will have at least some idea of how to create value and meaning continuously at all levels and in all areas of their organization’s operation.

The Open Innovation Marketplace: A book review by Bob Morris

The Open Innovation Marketplace: Creating Value in the Challenge Driven Enterprise 
Alpheus Bingham and Dwayne Spradlin
FT Press/Pearson (2011)

How and why global networks of highly specialized expertise create value in the challenge driven enterprise

In Open Business Models (2003), Henry Chesbrough observes, “An open business model uses a 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.” Then in Open Innovation (2005), he develops this concept in much greater depth. As Chesbrough explains, what he characterizes as “Closed Innovation” has a number of implicit rules such as ”The company that gets an innovation to market first will usually win” and “We should control our intellectual property, so that our competitors don’t profit from our ideas.”

As a result of several “erosion factors,” the Closed Innovation paradigm is rapidly becoming obsolete. (Please see Table 1-4, “Contrasting Principles of Closed and Open Innovation,” on Page xxvi in the Introduction.) “When the innovation context shifts from Closed to Open, the process of innovation must change as well.” Today, adoption of the Open Innovation model has become wide (i.e. global) and deep (i.e. enterprise-wide and even federation-wide).

In what could be viewed as a “State of the Global Marketplace” analysis, Alpheus Bingham and Dwayne Spradlin brilliantly explain how and why global networks of highly specialized expertise create value in the challenge driven enterprise.
I especially appreciate the provision of a case study at the conclusion of Chapters 2-9. Each focuses on achievement of high-impact results. For example, HOW

2: Orchestration Creates Value for Li and Fung
3: NASA Expanded Its Innovation Framework to Find New Solutions to Old Problems
4: The Oil Spill Recovery Institute Tapped the Crowd to Be Better Prepared for Arctic Spills
5: Eli Lilly and Company Is Changing from a Closed Company to an Open Network to Provide Medicines for the Twenty-First Century
6: How Procter & Gamble Is Innovating Through Connect + Develop
7: Virtual Software Development: How TopCoder is Rewriting the Code
8: The Prize4Life Foundation Is Crowdsourcing ALS Research
9: President Obama’s Open Government Initiative Is Reinventing Government and Changing Culture

Obviously, the nature and extent of success of these open innovation initiatives vary and all of the organizations are large and have complicated operations. However, valuable lessons cam be learned from success as well as from failure and as the case studies suggest, decision-makers in almost any organization (regardless of size or nature) can apply many of these lessons when responding to their own challenges. Li and Fung, for example, is renowned for its leadership and management of a global supply chain more extensive than almost any other. Leaders within the hundreds of companies within that chain would be well-advised to read the case study in Chapter 2. In fact, I think the entire book is “must reading.”

Bingham and Spradlin devote Part I to explaining Challenge Driven Innovation (CDI) and then Part II to the Challenge Driven Enterprise (CDE). More specifically, they explain “how a marketplace of innovation allows us to reframe the innovation model, improve performance, and manage risk (Chapters 2-5) and then “virtualizing the business model to drive innovation, agility, and value creation” (Chapters 6-9). Appropriately, they focus on “The Challenge Driven Enterprise Playbook” in Chapter 8, reviewing and correlating many of their key points, then focus on “Leadership” in the final chapter because the success or failure of any open innovation initiatives will depend on the leadership (at all levels and in all areas) of the given enterprise.

These are among the dozens of passages that caught my eye:

o   “Exploration Versus Exploitation (Pages 13-14)
o   “Chat Rooms Versus Expert Help Desks” (29)
o   “Open Innovation’s Unique Potential” (40-42)
o  ”Seven Stages of Challenge Driven Innovation” (49-52)
o  ”Tackling the Long Tail” (74-77)
o  ”A Thousand and One Explorers or How to Find a Star” (78-79)
o  ”Innovation Channels” (95-101)”Project Model Archetypes” (102-109)
o  ”Hallmarks of the Challenge Driven Enterprise” (128-129)
o  ”The Challenge Driven Enterprise as Business Strategy” (144-147)
[Note: Be sure to check out Enterprise Architecture As Strategy: Creating a Foundation for Business Execution, co-authored by Jeanne W. Ross, Peter Weill, David Robertson.]
o  ”Key Points of the Book” (200-203)
o  ”The CEOs Journey: Five Essential Waypoints” (206-208)

No brief commentary such as mine can do full justice to the scope and depth of the material (information, insights, and counsel) that Alpheus Bingham and Dwayne Spradlin provide in such abundance. However, I hope these remarks will encourage business leaders, indeed all who are entrusted with the leadership of any enterprise, to read and then re-read this book with appropriate care. In years to come, success or failure in the open innovation marketplace will be determined by those who do – or don’t – create value in the challenge driven enterprise.

Doing Both: A book review by Bob Morris

Doing Both: Capturing Today’s Profit and Driving Tomorrow’s Growth
Inder Sidhu
FT Press/Pearson

Organizational transformation is not — repeat not – a zero-sum game

One of the most self-defeating mindsets is suggested by the admonition, “You can’t have your cake and eat it too.” Obviously there are situations when there are two options that are mutually-exclusive. However, most of the time, when facing a choice, it is a mistake to select only one and dismiss all others. Inder Sidhu does not advocate “a balanced compromise between two objectives, but [rather] a mutually reinforcing multiplier in which each side makes the other better.” He cites comments included in Built to Last (1994) co-authored by Jim Collins and Jerry Porras when discussing a highly visionary company “that doesn’t want to blend yin and yang into a gray indistinguishable circle that is neither highly yin nor highly yang; it aims to be distinctly yin and distinctly yang – both at the same time, all the time. Irrational? Perhaps. Rare? Yes. Difficult? Absolutely.”

Sidhu devotes the bulk of his lively narrative to explaining how exemplar companies such as Apple, BYD, Cisco, GE, Google, IBM, and Procter & Gamble achieve these strategic objectives:

• Improving the core business while conducting disruptive innovation
• Strengthening current account relationships while adding new ones
• Fine-tuning what is done well while transforming or eliminating what isn’t
• Creating customer evangelists while creating steadfast partners
• Thriving on “Main Street” while exploring “the road less traveled”
• Doing it right and doing what is right (i.e. what matters)

Obviously, doing both (of whatever) is not always possible or, when possible, advisable. Also, any lessons learned from the exemplar companies such as those Sidhu examines (especially Cisco) must be modified to accommodate the specific needs and resources of much smaller organizations.

With all due respect to the value of these lessons, I think the single greatest benefit of this book is the mindset it can help its reader to develop. Although Sidhu does not cite them and their books, he has clearly been influenced (albeit indirectly) by business thinkers such as Henry Chesbrough (Open Innovation and Open Business Models) and Roger Martin (The Opposable Mind) as well as Venkat Ramaswamy and Francis Gouilllart (The Power of Co-Creation). The most effective executives an open mind in combination with insatiable curiosity, emotional intelligence, and highly-developed skills for integrative thinking. Organizations as well as individuals must never play a zero-sum game. Long-term growth and short-term profitability are NOT mutually exclusive.

The authors’ recommendations in the aforementioned books track almost seamlessly with Sudhu’s own:

1. Be open-minded to possibilities, whenever/wherever they occur
2. Respect and examine those that are plausible, especially if unorthodox
3. Seek out collaborations that are mutually-beneficial
4. Welcome each “failure” as a precious learning opportunity
5. Juxtapose (for rigorous scrutiny) contradictory ideas and options
6. Embrace change as an ally, not as a threat
7. Achieve constant improvement with a discovery-driven process
8. Welcome and support principled dissent
9. Cultivate and nourish an insatiable appetite for learning
10. Constantly challenge what James O’Toole characterizes as “the ideology of comfort and the tyranny of custom”

I highly recommend all of the aforementioned books as well as Dean Spitzer’s Transforming Performance Measurement; also Enterprise Architecture as Strategy co-authored by Jeanne Ross, Peter Weill, and David Robertson.

Open Services Innovation: A book review by Bob Morris

Open Services Innovation: Rethinking Your Business to Grow and Compete in a New Era
Henry Chesbrough
Jossey-Bass/John Wiley & Sons (2011)

How to grow, compete, and succeed in a services era

In his previous articles and books (notably Open Innovation and Open Business Models), Henry Chesbrough has a great deal of value to say about results-driven, multi-dimensional collaboration/co-creation within and beyond any organization, whatever its size and nature may be. Given the current economy and, especially, ever-increasing commoditization, his latest book is especially valuable because he thoroughly explains in it how to deliver better products and services for any business’ customers “that will allow it to grow and compete in a services era, ultimately escaping the commodity trap and that treacherous treadmill.”

Chesbrough makes the case for open services innovation in Chapter 1. I was especially interested in what he has to say about “The Commodity Trap,” one that reveals three business realities. Here’s the challenge: How to avoid or escape from that trap? That’s the focus of Part 1 (Chapters 1-5) in which he provides and discusses a framework to spur innovation and growth. This framework is based on four concepts and practices:

1. Think of your business as a service business
2. Innovators must co-create with customers
3. Open innovation accelerates and deepens service innovation
4. Business models are transformed by services innovation

Chesbrough observes, “By transforming products into platforms that incorporate internal and external innovations and surrounding these platforms with a variety of value-added services, companies can obtain some breathing space from relentless price and cost pressures.”

In Part 2, (Chapters 6-9) he describes a full range of applications and examples of Open Services Innovation (OSI) in a variety of industries, geographies, and contexts. More specifically, in larger companies (e.g. Xerox and GE), smaller companies (e.g. MTV Networks and NetBase), service businesses (e.g. Amazon), and in emerging economies (e.g. Asian Paints, SSIPEX, and ShaanGu). Then in the final chapter, Chesbrough explores “the larger context in which the shift toward services innovation is taking place.” More specifically, he discusses that shift in historic context, addresses especially important issues in service innovation, and then shares what are obviously heart–felt as well as highly-rational convictions about “the way forward” into an uncertain future that is certain to consist of both major perils and major opportunities. “It is high time to get started on the journey” and, I presume to add, this book would be an invaluable travel guide.

Most Valuable Business Insights: 11-15

After having read and reviewed so many business books, I now share brief comments about what I consider to be the 25 most valuable business insights and the books in which they are either introduced or (one man’s opinion) best explained. Here are the third five:

11. Leadership: In essence, leaders attract followers so that together they can achieve shared objectives, guided and informed by shared values based on mutual trust and respect. History’s greatest leaders are remembered for a heritage, usually based on great achievements that had an enduring impact. Alexander and then Julius Caesar for establishing or extending a great empire and Lincoln for preserving union despite a civil war.

The same is true of great business leaders such as Albert Sloan, Thomas Watson Sr. and Jr., and Steve Jobs. They could not have succeeded, had they not attracted sufficient followers who embraced both a dream and great challenges. Today, no organization can survive – much less thrive – without effective leadership at all levels and in all areas. Seth Godin said it well: “Initiative is taken, not given.”

Best Sources: Warren Bennis’ On Becoming a Leader, James O’Toole’s The Executive’s Compass: Business and the Good Society, Bill George’s True North: Discover Your Authentic Leadership co-authored with Peter Sims, and William C. Taylor’s Practically Radical: Not-So-Crazy Ways to Transform Your Company, Shake Up Your Industry, and Challenge Yourself

12. Management: In essence, managers organize and then complete tasks and among their most important tasks is supervising others. The most efficient managers do that most efficiently, with highly-developed emotional intelligence. I’ve always believed that managers help keep the promises that leaders make. With all due respect to compelling visions, someone has to take out the garbage, milk the cows, and turn off the lights. I agree with Thomas Edison: “Vision without execution is hallucination.”

Best Sources: Henry Mintzberg’s Management? It Isn’t What You Think!, Peter F. Drucker’s The Effective Executive: The Definitive Guide to Getting the Right Things Done, and Execution: The Discipline of Getting Things Done co-authored by Larry Bossidy and Ram Charan

13. Marketing: Create or increase demand for a customer-focused, multi-sensory experience that pro0mises a unique, enjoyable, and fulfilling experience. Initially, a “market” was a specific location; later, it was viewed as a specific segment of sellers/buyers (e.g. housing) and then as a cluster of demographics (e.g. males ages 29-45); later, marketing was defined as a brand, then a promise, and now an experience that creates “customer evangelists.”

Best Sources: Theodore Levitt’s The Marketing Imagination and Philip Kotler’s Kotler on Marketing.

14. Mergers & Acquisitions: Mergers are (usually) blended consolidations of two previously independent entities whereas acquisitions (usually) involve one entity being absorbed and then controlled by another. A majority of M&As fail or fall far short of expectations and the reasons vary but usually include irreconcilable cultural differences (e.g. values, silos, and turf issues).

Best Sources: Steve Steinhilber’s Strategic Alliances: Three Ways to Make Them Work (Memo to the CEO) and The Complete Guide to Mergers and Acquisitions: Process Tools to Support M&A Integration at Every Level co-authored by Timothy J. Galpin Mark Herndon

15. “Open” Mindset: This mindset is well-named because those who develop it are literally “open” (i.e. receptive to and respectful of) whatever possibilities they may encounter. They constantly ask “Why?” and “Why not?” They consider, compare/contrast, and integrate sometimes contradictory information but also opinions, assertions, theories, etc. The metaphor I use to describe this mindset is that it opens doors and windows and sheds light on whatever has possible relevance and value. The singe most significant, indeed defining characteristic of an open mindset is insatiable curiosity.

Best Sources: Henry Chesbrough’s Open Business Models: How to Thrive in the New Innovation Landscape, Open Innovation: The New Imperative for Creating And Profiting from Technology, and Open Services Innovation: Rethinking Your Business to Grow and Compete in a New Era as well as Roger Martin’s The Opposable Mind: Winning Trough Integratuve Thinking, and Morten T. Hansen’s Collaboration: How Leaders Avoid the Traps, Create Unity, and Reap Big Results

You may also wish to check out Most Valuable Business Insights: 1-5 and Most Valuable Business Insights: 6-10.

Most Valuable Business Insights: 6-10

After having read and reviewed so many business books, I now share brief comments about what I consider to be the 25 most valuable  business insights and the books in which they are either introduced or (one man’s opinion) best explained. Here are second five:

6. Customer Evangelism: Satisfaction is determined per transaction; loyalty is determined by sustainable satisfaction; zealotry occurs only when customers say “Yes!” to this question posed by Fred Reicheld: “Would you strongly recommend us to a friend, neighbor, or colleague?”

Best Sources: Fred Reichheld’s The Ultimate Question: Driving Good Profits and True Growth and Creating Customer Evangelists: How Loyal Customers Become a Volunteer Sales Force co-authored by Ben McConnell and Jackie Huba.

7. EDNA: This is an acronym I devised long ago when I began to teach English at Kent School in Connecticut.

Exposition (i.e. expose, reveal, open up, reveal) explains with information.
Description makes vivid with compelling images.
Narration explains a sequence and/or tells a story
Argumentation convinces with logic and/or evidence

Effective communication relies on mastery of one or more of these four.

Best Sources: Robert B. Cialdini’s Influence: Science and Practice (5th Edition) and Crucial Conversations: Tools for Talking When Stakes Are High co-authored by Kerry Patterson, Joseph Grenny, Ron McMillan, and Al Switzler

8. Employee Engagement: Recent research indicates that, on average, less than 30% of a workforce in the U.S. is actively and positively engaged. The others are either passively engaged (i.e. mailing it in) or actively disengaged (subversive and toxic). Increase active and positive engagement by (a) convincing workers that they and what they do are appreciated, (b) making crystal clear what expectations of them are and how their performance will be measured, (c) earning and sustaining their trust and respect by setting an with what you say (both verbally and non-verbally) and with what you do.

Best Sources: Freedom, Inc.: Free Your Employees and Let Them Lead Your Business to Higher Productivity, Profits, and Growth co-authored by Brian M. Carney and Isaac Getz, Simon Sinek’s Start with Why: How Great Leaders Inspire Everyone to Take Action, Edward M. Hallowell’s Shine: Using Brain Science to Get the Best from Your People, and The Why of Work: How Great Leaders Build Abundant Organizations That Win co-authored by Dave Ulrich and Wendy Ulrich.

9. Innovation: In essence, innovation achieves improvement of what already exists and that could include almost anything (e.g. an idea, assumption, theory and strategy as well as a product, process, or behavior). Almost anything can be improved and almost anyone can do that by embracing that challenge and pursuing that opportunity.

Best Sources: Tom Kelley’s The Idea of Innovation and The Ten Faces of Innovation (both co-authored with Jonathan Littman) as well as Steve Johnson’s Where Good Ideas Come From: The Natural History of Innovation and Henry Chesbrough’s Open Innovation: The New Imperative for Creating and Profiting from Technology

10. Lean: The concept of “less is more” can be dated back at least to ancient Greece. In a business context, its core concept is elimination of whatever is wasteful such as a production process that consumes too much time and effort as well as raw materials, one that results in omissions, duplications, redundancies, and flaws. Albert Einstein probably said it best: “Make everything as simple as possible…but no simpler.”

Best Sources: James Womack’s Lean Thinking: Banish Waste and Create Wealth in Your Corporation, Revised and Updated and Lean Solutions: How Companies and Customers Can Create Value and Wealth Together, both co-authored with Daniel T. Jones

Note: You may also wish to check out Most Valuable Business Insights: 1-5.

Inder Sidhu’s Doing Both: A book review by Bob Morris

Doing Both: How Cisco Captures Today’s Profit and Drives Tomorrow’s Growth
Inder Sidhu
FT Press/Pearson (2010)

One of the most self-defeating mindsets is suggested by the admonition, “You can’t have your cake and eat it too.” Obviously there are situations when there are two options that are mutually-exclusive. However, most of the time, when facing a choice, it is a mistake to select only one and dismiss all others. Inder Sidhu does not advocate “a balanced compromise between two objectives, but a mutually reinforcing multiplier in which each side makes the other better.” He cites comments included in Built to Last (1994) co-authored by Jim Collins and Jerry Porras when discussing a highly visionary company “that doesn’t want to blend yin and yang into a gray indistinguishable circle that is neither highly yin nor highly yang; it aims to be distinctly yin and distinctly yang – both at the same time, all the time. Irrational? Perhaps. Rare? Yes. Difficult? Absolutely.”

Sidhu devotes the bulk of his lively narrative to explaining how exemplar companies such as Apple, BYD, Cisco, GE, Google, IBM, and Procter & Gamble achieve these strategic objectives:

• Improving the core business while conducting disruptive innovation
• Strengthening current account relationships while adding new ones
• Fine-tuning what is done well while transforming or eliminating what isn’t
• Creating customer evangelists while creating steadfast partners
• Thriving on “Main Street” while exploring “the road less traveled”
• Doing it right and doing what is right (i.e. what matters)

Obviously, doing both (of whatever) is not always possible or, when possible, advisable. Also, any lessons learned from the exemplar companies such as those Sidhu examines (especially Cisco) must be modified to accommodate the specific needs and resources of much smaller organizations.

With all due respect to the value of these lessons, I think the single greatest benefit of this book is the mindset it can help its reader to develop. Although Sidhu does not cite them and their books, he has clearly been influenced (albeit indirectly) by business thinkers such as Henry Chesbrough (Open Innovation and Open Business Models) and Roger Martin (The Opposable Mind) as well as Venkat Ramaswamy and Francis Gouilllart (The Power of Co-Creation). Their major recommendations track almost seamlessly with Sudhu’s own:

1. Be open-minded to possibilities, whenever/wherever they occur
2.Respect and examine those that are plausible, especially if unorthodox
3. Seek out collaborations that are mutually-beneficial
4. Welcome each “failure” as a precious learning opportunity
5. Juxtapose (for rigorous scrutiny) contradictory ideas and options
6. Embrace change as an ally, not as a threat
7. Achieve constant improvement with a discovery-driven process
8. Welcome and support principled dissent
9. Cultivate and nourish an insatiable appetite for learning
10. Challenge what James O’Toole characterizes as “the ideology of comfort and the tyranny of custom”

I also highly recommend the aforementioned books by Chesbrough, Martin, and Ramaswamy and Gouilllart as well as Steven Johnson’s Where Good Ideas Come From, Henry Mintzberg’s Management? It’s Not What You Think!, and The Talent Masters co-authored by Chris Brogan and Julien Smith.

Adrian Gostick: An interview by Bob Morris

Adrian Gostick

Adrian Gostick is the author of several bestselling books on corporate culture, including The New York Times, USA Today and Wall Street Journal bestseller The Carrot Principle, co-authored with Chester Elton. Gostick also wrote the bestsellers The Integrity Advantage (co-authored with Dana Telford) and The 24-Carrot Manager (co-authored with Elton). His latest book, also co-authored with Elton, is The New York Times bestseller The Orange Revolution: How One Great Team Can Transform an Entire Organization. His research on employee engagement has been called a “must read for modern-day managers” by Larry King of CNN, “fascinating,” by Fortune magazine and “admirable and startling” by the Wall Street Journal.

Gostick’s books have been translated into 20 languages and are sold in more than 50 countries around the world. As a leadership expert, he has appeared on numerous national television programs including NBC’s Today Show and has been quoted in dozens of business publications and magazines. He is vice president of the training and publishing arm of the O.C. Tanner Recognition Company. Gostick earned a master’s degree in strategic communication and leadership from Seton Hall University, where he is a guest lecturer on organizational culture.

Morris: Before discussing any of your books, a few general questions. First, whatever we call the current economic period (e.g. recession, depression, disruption, reset), the fact remains that most people are struggling to survive financially. That said, do you think that the importance of monetary rewards is more than, less than, or about the same as it was (let’s say) five years ago?

Gostick: Just so we are clear: In this economy, as in any really, you pay people absolutely as much as you can afford. The trouble is, we only have so much money to go around. So, with the absence of huge amounts of cash to hand out to our people, what do we do? That’s where we must get creative in engaging our people, helping them feel part of something important, giving them opportunities to grow, letting them know we care about them as individuals.

Morris: Is there an incentive that is even more important to workers than a monetary award? If so, why? And what is the significance of that?

Gostick: What the research shows is that monetary awards are not as motivating as tangible awards. I know that’s counterintuitive, but here’s what the research says. People use small amounts of cash—in fact anything less than $1,000—on paying their bills. Nothing very memorable about paying the gas bill. But it’s amazing how hard people will work to get a new set of golf clubs, jewelry, a trip, or some other tangible award. Psychologists will tell you that people will always say “give me the money. I don’t care if it’s 5 bucks, I want the cash.” But in reality we are not motivated by small amounts. We are motivated by seeing ourselves playing with that new set of clubs, wearing that jewelry or taking the trip.

Morris: Recent research conducted by highly reputable firms such as Gallup and Towers Watson (formerly Towers Perrin) indicates that workers rank “feeling appreciated” among the two or three attributes most important to them. Moreover, a high percentage of highly valued employees indicate, during exit interviews, one of the major reasons to accepting a position elsewhere is that they do not feel appreciated. Here’s my question. Why do so many workers feel under-valued, if valued at all?

Gostick: Why? Because we as managers are so bad at appreciating great work. We are. First, we get so wrapped up in our own work, meeting customer requests, doing what our bosses want, that we forget our primary role is to motivate and engage our team. The ten people we manage can get a lot more done than we can if we only would appreciate more. Second, we think we are pretty good at recognition already. Our research found that 67% of managers believe they are above average at appreciating great work, but only 23% of employees agreed that their boss’s were good at this. That’s a huge gap in perception!

Morris: To what extent (if any) do the most prestigious business schools at major universities (such as Harvard, Northwestern, Michigan, Dartmouth, MIT, and Pennsylvania) prepare executives to provide the recognition and appreciation that all workers crave and few receive?

Gostick: We’ve been asked to speak at several large business schools lately because more educators are realizing this is a gap in their curriculum. However, with that said, few business schools really teach the new generation of MBAs how to serve their people, how to be compassionate, how to communicate effectively. I hear more and more that these newly minted MBAs come out very smart, able to balance a ledger, but with little idea how to motivate a team.

Morris: Now please shift your attention to The Carrot Principle. What promoted you and Chet Elton to write it?

Gostick: We’d been working with some of the world’s best organizations for almost twenty years, putting in place employee engagement and recognition programs. We knew anecdotally that recognition done well could impact a company’s bottom line, but we didn’t have the statistical proof. We conducted a 200,000-person study for that book, and what we found was that once we had the stats, leaders were much more willing to listen to our ideas.
Morris: Since its publication, has the percentage of leaders worldwide who practice recognition with their employees increased, decreased, or remained about the same? Why

Gostick: The book has sold more than half a million copies worldwide and has been adopted by some very large organizations as a Bible of how to treat their people, so I certainly hope we’ve helped. Every year we host a “Carrot Summit” during which business leaders share their success stories of using these ideas, and it’s wonderful to hear how real businesses have shaped their programs from the words we wrote.

Morris: In the Introduction to the second edition (published in 2009), you identify four types of executives: Positives, Fearful, Controllers, and Negatives. Here’s a two-part question: What are the dominant characteristics of each, and, what was each category’s percentage of the total number of people who participated.

Gostick: Here’s what we found from the managers in the survey. Only 26% of leaders are Positive on recognition. They practice this with their employees whether or not they’ve been giving permission and tools from their HR group. The next set of managers (22%) are Fearful of recognition. They want to recognize, but haven’t been given permission from senior leadership to spend any money or do anything out of the norm so they are paralyzed by fear. The next group (20%) are what we call Controllers. They are worried about the human elements of recognition—the jealousies that might occur if they recognize Bob and not Sue, so they do nothing. The last group (a whopping 32% of managers) are Negative on recognition. They add such pearls of wisdom to the leadership lexicon such as “they get recognition every two weeks in their paychecks, don’t they?” This group of managers was by far the least productive.

Morris: What is an “accelerator” and why is one needed?

Gostick: We found that recognition couldn’t make these lousy managers better. They were simply distrusted. However, we found that good managers could use recognition to make everything they were doing better. Recognition in the research was shown to increase the perception of open communication, trust, goal-setting, accountability, teamwork, etc. Appreciating great work accelerated performance. It just makes sense, and now we have the research to statistically prove it.

Morris: Three-part question. First, what are the “Basic Four” foundational building blocks of effective leadership and management? Which seems to be the most difficult to develop? Why?

Gostick: When we did correlation studies on great teams, we found managers received high marks for recognition, but also for four other leadership characteristics: goal-setting, communication, trust and accountability. We came to call them the Basic Four of Leadership because they are so foundational to success. Each is hard to master in its own way: It’s easy to set goals, but hard to provide clarity around goals. It’s easy to communicate, but hard to be open and honest and consistent. Trust is hard to build and maintain, but it is essential in every business relationship. Accountability is also difficult, because we typically see it as a negative.

One employee put it this way: when I make a mistake I’m recognized 100 percent of the time, but when I do something great I’m not recognized 99 percent of the time. In the great teams we studied, managers turned that 1 percent recognition into 5 percent, 10 percent, 20 or higher.

Morris: As you know, Henry Chesbrough has much of value to share in two books, Open Innovation and Open Business Models, about organizational values such as clarity, accessibility, transparency, receptiveness, and trustworthiness. Are these not among the same principles that effective leaders and managers also follow?

Gostick: Absolutely! In fact they are captured in our research findings we call the Basic Four. You must provide clarity of goals. You must be accessible, transparent and receptive to new ideas if you want to build a strong communication culture. And you must be trustworthy.

Morris: Please explain the terms “Altruist” and “Expector.”

Gostick: This is kind of funny. We found a large group of managers who provided recognition to their employees with the “expectation” of something in return, typically harder work. Employees saw through this motivation. However, we found a group of managers who “altruistically” recognized their people for great work because it was the right thing to do. This group of managers saw much better results and had much higher employee engagement scores. So, it does pay to recognize, but you must have good motives.

Morris: To what does the acronym “SAIL” refer? Significance?

Gostick: We found great managers told stories when they recognized. They talked about the Situation they faced, or the problem. They mentioned the Action the employee took to resolve the situation. They talked about the Impact the employee made by taking ownership, being innovative, resolving the customer issue, etc. And finally, they Linked it to the core values of the organization. It’s a great way to make recognition meaningful.

Morris: You seem to agree with Thomas Edison that “vision without execution is hallucination.” In Appendix A, you provide a “Recognition Effectiveness Model.” How does it help to measure the total impact of recognition initiatives? Can it also measure the impact of each individual “carrot”?

Gostick: I love that quote from Edison! What we found in our research is that most company strategies are eerily familiar. We like to think we’ve all invented the iPod and we are markedly different from our competitors, but in truth most customers can’t tell our products apart. What differentiates us is our employees. If they are engaged they will execute on your plan. Anyone can have a plan or vision, but only the great companies sustain high-impact execution.

Macrowikinomics: A book review by Bob Morris

Macrowikinomics: Rebooting Business and the World
Don Tapscott and Anthony D. Williams
Portfolio/The Penguin Group
(2010)

Those who have read Wikinomics: How Mass Collaboration Changes Everything (2008) already know that Don Tapscott and Anthony Williams favor the “open” organizational model based on three basic principles: transparency, inclusiveness, and collaboration. Refinements of that model can (and often do) reflect the influence of Charles Darwin (e.g. the concept of a process of natural selection) and Joseph Schumpeter (e.g. the concept of creative destruction). Those who wish to learn more about the model itself are urged to check out two books by Henry Chesbrough, Open Innovation and Open Business Models.

What differentiates this book from its predecessor? Tapscott and Williams have extended their scope, as indicated in this passage when they observe that “a powerful new form of economic and social innovation” is sweeping across all sectors and, indeed, all continents, “one where people with drive, passion, and expertise take advantage of new Web-based tools to get more involved in making the world more prosperous, just, and sustainable.” In a phrase, “global wikinomics.” That is to say, Tapscott and Williams have extended the scope and depth of mass collaboration to include any/all social networks worldwide that wish to be connected and interactive.

I agree with them that there is indeed an “historic opportunity to marshal human skill, ingenuity, and intelligence on a mass scale to reevaluate and reposition many of our institutions for the coming decades and for future generations.” This will require massive and – here’s the greatest challenge – simultaneous collaborative transformation of all traditional institutions (e.g. social, political, educational, and financial). I also agree with French president Nicholas Sarkozy’s assertion, “This is not just a global financial crisis, it is a crisis of globalization.”

Here are three of several reasons why I hold this book in such high regards:

1. It makes a strong case for understanding problems that exist today and will almost certainly become worse.

2. It also makes a strong case for understanding how to solve those problems with resources that did not exist or were insufficient until recently (e.g. technologies that support social networks).

3. It provides the authors’ passionate and compelling affirmation of their faith that the “new future” can be forged.

Tapscott and Williams conclude, “Three hundred years ago Martin Luther called the printing press ‘God’s highest act of grace.’ With today’s communications breakthroughs we have an historic occasion to reboot business and the world using wikinomics principles as our guide. Because each of us can participate in this new renaissance, it is surely an amazing time to be alive. Hopefully we will have the collective wisdom to seize the time.”

I include this last passage to indicate that this book is not at operations manual; rather, it is a manifesto. Tapscott and Williams are pilgrims on a mission and they invite their reader to join them.

The Invisible Edge: A book review by Bob Morris

The Invisible Edge: Taking Your Strategy to the Next Level Using Intellectual Property
Mark Blaxill and Ralph Eckardt
Portfolio/The Penguin Group (2009)

What are the most important invisible assets that make up the world of intellectual property (IP)? In this book, Mark Blaxill and Ralph Eckardt include these: trade secrets, trademarks, copyrights, and patents for invention. In the first four chapters of their book, they establish the foundations for thinking about IP: how invisible investments drive economic growth, how intellectual property drives business profits, how to unleash “the company of ideas,” and how to turn complexity into a competitive advantage. Then in the next three chapters, they shift their attention to corporate strategy: why innovation without protection is philanthropy, how to realize the benefits of open innovation, and how to win by design. In the final three chapters, they “zoom out to see how IP is changing the face of economic competition between countries, and [they also] zoom in to see that IP assets are becoming tradable commodities, and that an entirely new asset class is beginning to emerge. More specifically, they explain why “IP nations” are the future of global competition, why the emerging market of IP is “a capital idea,” and how to formulate a strategy and game plan that will achieve an invisible competitive advantage.

The material provided in Section II, “Competitive Strategy for a Company of Ideas” (Chapters 5-7), is of special interest to me. Having explained in Part I why IP strategies require the development of relational advantages in a complex competitive environment, Blaxill and Eckhardt then shift their attention to how strategies of control, collaboration, and simplification “echo the three attributes of a basic network [i.e. nodes, links, and clusters] and comprise a cycle: one where opportunity leads to success, success confronts its limits, and limits create new opportunities.” In Chapter 5, the authors provide a mini-case study of Gillette razors and blades (Pages 127-135), noting that the best intellectual property managers such as those at Gillette “are very protective of their methods for managing the IP process.”

I agree with Blaxill and Eckhardt that, for companies that invest heavily in innovation, “the effective management of the modern-day version of Edison’s original innovation factory has become one of the few management tasks that can actually contribute to competitive advantage.” They also briefly but insightfully discuss the portfolio of IP formats that includes trade secrets, trademarks and brands, design patents, and utility patents. With regard to the core principle of collaboration, Blaxill and Eckhardt devote Chapter 6 to explaining the its three main benefits: (1) delivering complex solutions to the market more expeditiously and more efficiently, (2) getting to market with complementary patents in strategic alliance (i.e. partnership) with dozens of patent-hold companies (e.g. in a patent pool), and (3) energizing and tapping external innovation (i.e. forces outside the company) that presents a multiple of solutions for each of the given problem(s). They cite the example of Linux that shows “how mass collaborations have emerged as a powerful and viable new form of open innovation even if they are often misrepresented as a form of utopian socialism in action.”

Near the conclusion of Section II (Page 224), this passage caught my eye: “Although open-source models like Linux are themselves a form of disruption technology, disruptive technologists often go the opposite direction of openness. Instead, they frequently reject componentization as they introduce new, and highly integral, designs. Most notably, they often reject convertibility over time (or backward compatibility), a feature that makes them highly threatening to entrenched businesses with large installed bases of users (and related service businesses), since they can throw entire categories of business out of the market.” The stakes in market competition are indeed high, thus increasing both the value of relevant intellectual property and the need to protect it as well as leverage it strategically.

This book is by no means an “easy read.” In fact, I had to re-read it with even greater care before beginning to organize my thoughts about what to say in this review. I think the information, insights, and advice provided by Mark Blaxill and Ralph Eckhardt will be invaluable to decision-makers who are either planning to or who have only recently begun to take their strategy to the next level using intellectual property. Many of those who have read the first nine chapters may ask, “Now what?”

They will be pleased to find in the last chapter that that Mark Blaxill and Ralph Eckhardt respond directly to that question. After briefly and clearly reviewing the “what” of leveraging intellectual property, they devote most of their attention to explaining the “how.” For example, they suggest seven items for an action agenda that will avoid unintentional philanthropy (Pages 296-298); soon thereafter, they suggest that decision-makers consider seven action ideas to avoid “overplaying their hands and getting trapped in games of mutually assured destruction” (Pages 300-302); and then decision-makers are thinking about how a company can compete by using simplification strategies, they suggest another set of seven actions (Pages 304-306). Once again as throughout the narrative that precedes this material, the content is rock-solid, the core concepts are developed in depth, and the advice is eminently practical.