Here is an excerpt from an article written by Tom Davenport for the Harvard Business Review blog. To read the complete article, check out the wealth of free resources, and sign up for a subscription to HBR email alerts, please click here.
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The world continues to honor and mourn Steve Jobs weeks after his death, and there is plenty to praise. His legacy lives on in today’s iCloud and iOS 5 availability, and in the new iPhone 4S being praised by several prominent technology reviewers. David Pogue, my favorite technology writer, is so enthusiastic as to call the new phone’s features almost magical.
I’ve long admired Apple products, too. By my count there are six Macbooks, two iPads, and three iPhones—not to mention a few iPods—in my family’s possession. If you judge only by the product outcomes or by Apple’s market value, Jobs seems the best decision-maker in the history of consumer products.
But of course, like every other human, his decisions weren’t all great. In the 1980s he hired John Sculley to succeed himself as CEO of Apple, and Sculley presided over a period of slow growth and product missteps in the ensuing years. Jobs commented about Sculley: “What can I say? I hired the wrong guy. He destroyed everything I spent 10 years working for, starting with me.” Jobs’ major startup during his hiatus from Apple, NeXT Computer, was largely unsuccessful — at least in the hardware business. His decision to sell all of his Apple stock when Sculley pushed him out cost him billions. And when he came back as CEO, he allowed the backdating of stock options.
In terms of decision processes and style, Jobs was famous for being a tough micro-manager, at least where product design decisions are concerned. As a Fortune magazine article on Apple’s culture put it: “He’s a corporate dictator who makes every critical decision—and oodles of seemingly noncritical calls too, from the design of the shuttle buses that ferry employees to and from San Francisco to what food will be served in the cafeteria.”
He also didn’t believe in analytical decisions based on extensive market research. From The New York Times‘ obituary: “Mr. Jobs’s own research and intuition, not focus groups, were his guide. When asked what market research went into the iPad, Mr. Jobs replied: “None. It’s not the consumers’ job to know what they want.”
Based on the evidence, I will grant that he made some fantastic design decisions, but not that he was an expert on effective decision processes.
Granted, there is some evidence that even Jobs came to realize the shortcomings of one man’s intuition as the only source of decision wisdom. In a summary of a 1997 interview, a New York Times article published earlier this year noted: “In his early years at Apple, before he was forced out in 1985, Mr. Jobs was notoriously hands-on, meddling with details and berating colleagues. But later, first at Pixar, the computer-animation studio he co-founded, and in his second stint at Apple, he relied more on others, listening more and trusting members of his design and business teams.”
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To read the complete article, please click here.
Tom Davenport is the President’s Distinguished Professor of Information Technology and Management at Babson College and has taught at Harvard Business School, Dartmouth’s Tuck School, the University of Texas, and the University of Chicago. He is a widely published author and speaker on the topics of analytics, information and knowledge management, reengineering, enterprise systems, and electronic business. He has written over 100 articles for such publications as Harvard Business Review, Sloan Management Review, California Management Review, the Financial Times, and many other publications, and has been a columnist for Information Week, CIO, and Darwin magazines. His latest of a dozen books is Judgment Calls: Twelve Stories of Big Decisions and the Teams That Got Them Right, co-authored with Brook Manville and published Harvard Business Review Press (2012). To check out Tom’s other blog posts, please click here.
Here is an excerpt from an article written by Tom Davenport for the Harvard Business Review blog. To read the complete article, check out other articles and resources, and/or sign up for a free subscription to Harvard Business Review’s Daily Alerts, please click here.
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I’m writing a new book with Larry Prusak and Brook Manville. If we had to name it today, we’d call it Judgment Days: How Great Organizations Make Great Decisions. It’s about how organizations — rather than individuals — build their capacity for good judgment and decision making. We’re going to try to show how individual decisions, made on particular “judgment days,” were shaped and succeeded by activities to improve organizational judgment. We hope to describe a variety of organizations — from companies to schools to hospitals to foundations — that make consistently great decisions over time. In order to surface some of the ideas and get feedback from readers, I’m going to start blogging about the book and plan to get Larry and Brook involved in that activity.
We think that organizations with good judgment have a number of typical attributes. One is that they involve a number of different people in making important decisions. Their senior executives keep in mind that they don’t have a monopoly on knowledge and judgment and therefore involve multiple people in decision processes.
Let me give you an example. Pixar (btw, I really enjoyed Toy Story 3) has a phenomenal track record for making great animated movies. (Ed Catmull, the studio’s president and co-founder, recently wrote an article for HBR called, “How Pixar Fosters Collective Creativity.” Click here.) We don’t have access — at least yet — to details of the particular decisions made at Pixar, though some must have been difficult: for instance, the decision to make the movie Up about a 78-year old man who loses his wife and rides his balloon-floated house to South America.
How did Pixar make that and other good decisions? There seem to be several factors going on:
Its managers give its directors a lot of autonomy. The studio prides itself on being “director led” and gives them a high degree of autonomy. “Managers like to be in control,” but Pixar fights it, according to an interview with Catmull at an event The Economist put on in March. [Click here.]
Even though directors have autonomy, they get feedback from others. “Dailies,” or movies in progress, are shown for feedback to the entire animation crew. In The Economist interview, Catmull also describes a more extensive periodic peer review process:
“We have a structure so they get their feedback from their peers…. Every two or three months they present the film to the other filmmakers…and they will go through, and they will tear the film apart. Directors aren’t forced to respond to the feedback, but they generally do — and the films are generally better for it.”
Pixar uses a process for “postmortems” on the major aspects of movies after they’re completed. Ed Catmull described it as “like taking cod liver oil,” but the company insists on it anyway. During the postmortems, the team involved in the film is asked to come up with five things they’d do again and five things they wouldn’t do again. Postmortems not only surface the information but also help to prevent the problems from festering among team members. Catmull comments that because people are starting to game that postmortem process, Pixar is thinking of alternative approaches.
Pixar admits mistakes in other ways. Sometimes, when a movie project isn’t going well, Pixar will “restart” it. Toy Story 2, for example, wasn’t going well and had to be restarted. Catmull points to that restart as a catalyst for the articulation of several key values at the company.
Pixar has an extensive education program at Pixar University, with more than 110 different courses. That’s got to improve organizational judgment. And even there, employees are encouraged to make and admit mistakes. Randy Nelson, the director of Pixar University, says, in the book Mavericks at Work: “It’s the heart of our model…giving people opportunities to fail together and to recover from mistakes together.”
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To read the complete article, check out other articles and resources, and/or sign up for a free subscription to Harvard Business Review’s Daily Alerts, please click here.
Tom Davenport holds the President’s Chair in Information Technology and Management at Babson College. Over many years he’s authored or co-authored nine books for Harvard Business Press, most recently Competing on Analytics: The New Science of Winning (2007) and Analytics at Work: Smarter Decisions, Better Results (2010). His byline has also appeared for publications such as Sloan Management Review, California Management Review, Financial Times, Information Week, CIO, and many others. For more from Tom, visit his website [click here].
Amabile is one of my intellectual heroes (heroines?). She and her associates have conducted extensive research on the impact of job conditions on the quality of work produced.
They discovered that this is what the best work requires:
1. That people be given a great deal of freedom in figuring out how to complete the work – that is, the opportunity to make day-to-day decisions during the project. In a word, autonomy.
2. That team members felt both challenged and excited in a positive fashion by the work they were asked to do. In a word, inspiration.
3. That those involved had sufficient organizational support such as resources, a supportive work group, a supportive supervisor who communicates well, and an organizational environment in which creativity is strong encouraged and generously rewarded. In a word, appreciation.Another of my intellectual heroes is Mihaly Csikszentmihalyi, author of Creativity: Flow and the Psychology of Discovery and Invention (1997) and Flow: The Psychology of Optimal Experience (2008). He and his associates have also conducted rigorous and extensive research to determine when people are happiest in the workplace. Here is a brief excerpt from Flow:
“Hours pass by in minutes, and minutes can stretch out to seem like hours.” When researchers interviewed highly-accomplished specialists (e.g. musicians engaged in a performance, athletes engaged in competition), they spoke of feeling as though they were being carried along by water. They were almost floating. In a word, flow.
Therein lies both the challenge and opportunity that every organization faces: To establish and then sustain a work environment in which people do what they love and love what they do.
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Teresa Amabile is the Edsel Bryant Ford Professor of Business Administration in the Entrepreneurial Management Unit at Harvard Business School. She is also a Director of Research at the School and is the author of Creativity in Context and Growing Up Creative, as well as over 150 scholarly papers, chapters, case studies, and presentations.
Mihaly Csikszentmihalyi is professor and former chairman of the Department of Psychology at the University of Chicago. His previous books include the aforementioned Creativity and Flow as well as The Evolving Self.
Thomas H. Davenport holds the President’s Chair in Information Technology and Management at Babson College and is responsible for the overall management of the Institute for Process Management. He and Larry Prusak also manage the Working Knowledge program. His published works include Process Innovation, Thinking for a Living, Working Knowledge and What’s the Big Idea? with Prusak, The Attention Economy co-authored with John Beck, most recently Competing on Analytics co-authored with Jeanne G. Harris.
Note: This interview was conducted in 2007. Davenport is now in the process of completing another interview.
Morris: In your various books and articles, you offer excellent advice as to how to manage knowledge. Let’s begin with a more basic challenge, one which Carla O’Dell and Jackson Grayson examine in If Only We Knew What We Know: First determining what your information needs are and then what necessary knowledge already exists within an organization. Your views on that?
Davenport: I certainly agree that it’s better to start with the knowledge your organization possesses already. It’s somewhat surprising that relatively few organizations have done either of the two steps above. They don’t examine their strategies and decide what information and knowledge are critical to achieving them, and they don’t have a good inventory of what they know already. Those two steps in that order would be a great boon for knowledge management.
Morris: In What’s the Big Idea? you and Larry Prusak explain how ideas are linked to business success, who introduces ideas to organizations and how they do that, why “content counts,” where the best management ideas come from, how ideas interact with markets, where to find ideas most appropriate to a given organization and then how to sell them, and why idea-based leadership is essential to any organization’s success. These are admirable objectives. Why do so few organizations achieve them?
Davenport: People get very excited about business ideas, but they don’t manage them to fruition very well. There are a variety of problems in this regard. Most companies take on too many ideas at once. They don’t have any sort of process for monitoring how the idea is being implemented within the organization. GE is the primary exception. Under Jack Welch they developed a management system for making new business ideas a reality, and they were very disciplined about which ones they took on. Then there aren’t usually enough idea practitioners around to make it all work.
Morris: Also in What’s the Big Idea?, you and Prusak assert that “Idea-Friendly Culture” which (a) has open dialogue between and among all levels, (b) supports “boundarylessness” to maximize individual and collective intellect from both within and outside the organization, and finally, (c) encourages trust and responsibility which will “allow people to learn effectively from each other and provide motivation for putting ideas to work.” That said, what role could and should senior management have to expedite and support such initiatives?
Davenport: They control the organization’s resources, and each idea that an organization adopts consumes resources. So it’s very important that they decide which ideas enter the portfolio that the organization will try to implement. They’re really setting the idea strategy—“what ideas are we going to pursue?” They also have to put pressure on the organization to make things happen. At GE, Welch would call business unit managers who would be moving a little slowly on an idea, and say, “Why aren’t you doing more with digitization? This is really critical to our success and your long-term future here.” That’s obviously very powerful.
Morris: As you indicate in Thinking for a Living, what do you consider to be the appropriate relationship between knowledge workers and various technologies provided to them?
Davenport: In most cases thus far, knowledge workers have been the victim of the technologies. A lot of tools have been thrown at knowledge workers, and nobody’s given them much help in thinking about how it fits their jobs and their objectives. Now we all have a lot of technologies—laptops, desktops, PDAs, cell phones, pagers, etc.—but they don’t integrate very well, and everything is very fragmented. The result is that only a small percentage (less than 1% in my informal surveys) of knowledge workers feel that they are very good at managing their personal information and knowledge environments.
Morris: In the same book, you suggest that individual knowledge work improvement initiatives have two attributes. With regard to the first, why should they be focused on improving the performance of knowledge workers as individuals, not as members of a larger group
Davenport: I did some work with the Software Engineering Institute at Carnegie-Mellon. I realized that they had figured out something important. If you want to improve how an organization gets better at software development, you need to address the problem on multiple levels: the company, the team, and the individual. I think the same thing applies to knowledge worker productivity and effectiveness. We really haven’t done enough at any of these levels for knowledge work.
Morris: Why should individually oriented initiatives be directed at improving some skill or capability, rather than instituting a new process?
Davenport: I really believe in both. Again, we should be working on multiple levels. Of course, you can’t do that for every job. You have to pick one or a few knowledge work roles that are very critical to your organization’s success, and focus on those.
Morris: In Chapter 7 of Thinking for a Living, you pose a very important question: “What’s more important to improving knowledge worker performance: technological networks or human networks?” For those who have not as yet read your brilliant book, what is the gist of your response to that question?
Davenport: Well, I try to go with the data, and when we asked high-performing knowledge workers how they get the information they need to do their jobs, they generally said they got more useful information from their human networks than from technological ones. Consider the implications of that.
Of course, you don’t really have to choose—you can try to improve both types of networks. The problem is that most organizations spend a lot more time and money on the technological networks, and ignore the human ones altogether. Knowledge workers are well aware of that neglect…and resent it.
Morris: In your opinion, what are some of the most common misconceptions about the practices of high performance knowledge workers and how they get their work done?
Davenport: I guess the biggest misconception is that you can’t do anything with knowledge workers, as I suggested above. Organizations just leave them alone. I think it’s possible to impose a bit more structure on knowledge work and measure and improve it in almost every case. Of course, you can go too far, and alienate these unique and very valuable workers.
Morris: Before concluding this interview, please tell us about your next book, Strategic Management in the Innovation Economy, which you co-authored with Marius Leibold and Sven Voelpel.
Davenport: That book is really a textbook about how to pursue multiple forms of innovation in the contemporary world. I don’t generally do textbooks, but Marius and Sven did most of the work. Right now I am most excited about my next book, which is about how companies compete on their analytical capabilities. It should be out in early 2007. I’m not a terribly quantitative person myself, but I see the world moving in that direction. I wrote an article on this topic entitled “Competing on Analytics” in the January (2006) issue of Harvard Business Review, and it’s gotten a more positive reaction than just about anything else I’ve written. So I’m excited about it.