Do you think you’re giving enough feedback? “The feedback gap” takes a look at a new survey of workers. Some of the findings might make you think a bit harder about if you’re giving enough feedback.

You probably know we’ve written about passion a lot on this blog, but “Don Quixote Syndrome” has a take on it I’ve not thought about much. Though the author writes from the point of view that an entrepreneur is someone who starts a business, I think we can apply some of his thoughts to those of us who are entrepreneurs within organizations.

If you’re like me, you are waaaaaaay over the whole royal wedding thing. By the time you read this, it will all be over and that will be that. One thing that has amazed me in all of it is the wacky stuff people are buying in honor of the wedding. I have to keep in mind the mental model subjective value because I just don’t get it. Anyway, here’s a link explaining “Royal Wedding Markets in Everything.” It’s just another reminder that the market gives people things they want (even if we can’t explain why they want it)!

I enjoyed watching parts of a video released by FEE of Roger Garrison discussing Hayek v. Keynes. It’s a full lecture and is over an hour. Consider yourself warned about the time!

I didn’t have much time to check out the blogs this week, so help me out by leaving some links in the comments. Have a safe and happy weekend!

What if every single one of your customers had access to millions of readers?  What if just one did, but you didn’t know which one?  Turns out, there’s a “coupon site” customer out there who was able to write a review of Groupon and LivingSocial at CNN.com.  One of the companies fared quite well, the other not so much:

http://money.cnn.com/2011/04/26/technology/groupon_vs_livingsocial/index.htm?source=cnn_bin&hpt=Sbin

The article hit me hard at first.  Reason: I think two things are true (challenge if you disagree):

1. Customer Focus is important.  We should be intently looking to anticipate and satisfy the needs of our customers.
2. Economic thinking suggests that we should be trying to find our most profitable customers, and either discharge or make profitable customers that are not profitable.

If those two things are true, I find it a bit harder to analyze the situation than I did at first glance.   Was Groupon doing the right thing?  I mean, there are all sorts of unknowns in the world, including the fact that a customer currently giving you some grief (and maybe even costing you money) might be able to sway a lot of people with their opinion. 

As usual, I think the answer is: it depends.  Explictly (and respectfully) disengaging a customer that cannot be made profitable seems to be the right choice.  Stringing them along and providing bad service, not so much.  In fact, I think I’d go so far as to say that good Customer Focus demands that we be so focused on our customers that we respectfully part ways when the relationship isn’t mutually beneficial.

I can’t embed this week’s ad, so you’ll have to head over to YouTube to see it.  This one debuted during the Super Bowl this year. 

There are all sorts of fantastic (and funny) bits about knowledge in the ad.  The title, “With Knowledge Comes Confidence” is of particular interest to me.  Confidence is a funny word.  It can be used to mean “sure,” or “too sure.” 

So my question is, “What kind of confidence does knowledge bring, and how does it do so?”  Interested in hearing your thoughts!

Trying to keep up the “sea stories” in the blog, I was recently reminded about two examples of using “vision” in real life.

Call it “mission creep.” Call it a lack of discipline.  Call it a failure to follow unclear objectives.  Whatever you call it, sometimes it’s tempting to make a short-term decision that doesn’t fit long-term goals.  The business that caters to customers who aren’t in their niche; the non-profit that begins working on any issue vaguely related to its core cause; the government agency that expands it scope beyond its original mandate–all are probably failing to keep a clear “eye on the prize.”

About a year ago, I was fortunate to work with a group that was starting up a new 5k race.  I was impressed with how they handled a particular issue.

This 5k group was forming a cause-related race, with a theme relating to freedom and free markets.  This cash-strapped team was approached by a vendor who wanted to do two things.  First, he wanted to give them free t-shirts–thousands of dollars of something they needed badly–that would be branded with the race logo.  Second, in exchange, he wanted a booth at the event to promote his company.  The booth would have a “buy American” theme and emphasize how his shirts were “made in the U.S.A.”

The group was faced with a dilemma.  One the one hand, a vendor was offering thousands of dollars of something they needed when their total budget was incredibly small.   On the other, their race was free-market themed; in their eyes, a “only buy from one country” slogan didn’t fit with their message of improving people’s lives through free trade between any individuals, no matter what country they happen to live in.

Fortunately–according to this group–they had had many conversations about the vision of their race and the objectives they wanted to achieve.  After a tough conversation, they decided to turn down the help and find other options that were in line with their goals.  I’m happy to say that the race went off without a hitch, and with plenty of vendors, t-shirts and runners.

Another example comes from my business experience, and it’s unfortunately a failure to make the right call.  In a previous life, I had a math-tutoring corporation.  Early on–and similarly strapped for cash–I was approached by a father whose son had Asperger’s syndrome.   He wanted me to tutor him in social interactions.  Needless to say, the hours that I spent researching Asperger’s and developing lesson plans for the child were not hours and money spent on making the company better at our core focus–tutoring individuals in mathematics.  Though personally rewarding, I think those diverted resources limited our ability to improve the lives of other students and my impact on this student was limited due to my inexperience. 

When is going after a non-traditional project or customer an “experiment” or “being advantageous,” and when is it not following the vision?  Is a “vision” and a focus on “capabilities” the only guiderail we have to keep us from drifting away from our core value-creation strategies?

5k, mission creep, tutoring, vision

Every now and again I pop over to Stanford’s ECorner to see what’s new. Here are a few new clips from the past 4 months or so.

First, here’s Bill Gross talking about “Motivation Through Equity and Risk-Taking.”

Next, Guy Kawasaki suggests you “Conduct a Pre-Mortem Meeting” as one way to facilitate the challenge process.

Jack Dorsey explains “Payments as a Form of Communication.”

What do you think about these clips? What parts of these clips seem to align with MBM? What parts don’t align with MBM?

This post  by Seth Godin made me go, “huh, there’s a lesson in here.” Then, I debated if it was a Customer Focus or a Decision Rights lesson. It’s probably both. Maybe an example of how different aspects of MBM are mutually reinforcing. Maybe if the decision rights were clearer, it would enable employees to be more customer focused? What do you think?

I’ve been thinking a lot about the different disciplines that MBM draws from: Economics, Psychology, Science, History, etc. Sometimes the hardest part is trying to figure out where to start when investigating a new subject. So, I was delighted to see “The Books and Journal Articles All Psychologists Should Read.”

The always entertaining Bob Sutton writes about “A Cool Neurological Explanation for the Power of Small Wins.” The short version is, “Bosses beware, setting those big goals without breaking them into bite-sized people (or allowing and encouraging your followers to do so) will make you and your people dumb and uncreative — at least if Shawn is right. ”

This story reminds me that acting with integrity is not only the right thing to do, but the profitable thing to do. I don’t know if the allegations are true, but the seriousness of them is putting an organization at risk.

Leave us some links in the comments! Have a safe weekend!

Back in January, I blogged about constraint-based innovation.   This post from HBR.org lays out the details of a new contest:

The mission? Design a simple dwelling that can be constructed for under $300 which keeps a family safe, allows them to sleep at night, and gives them both a home and a sense of dignity.

Think about the last time you were asked to something big with very few resources.  I’ll be the first to admit that “playing the victim” is usually the first-choice reaction.  Additionally, I’m not suggesting that it’s never appropriate to seek more resources to make something happen.  I do think, however, that a good way to create more value is learning how to do more with less (doing a lot more with a little more works too!). 

What “build a house that can sell for $300″ situations have you faced?  Did you do succeed?  If so, how.  If not, what were the stumbling blocks?

I’m on the road today, but I wanted to pose a quick question for your discussion.

What is the most challenging economic concept for you to personally apply in your work, and why?

In an effort to build in more “case studies” (using that term loosely) about applying MBM, I wanted to share a story about an experience I had in helping a team develop a vision. 

First, it’s important to point out that I’ve done vision development a few times, but am far far far from being an expert on the issue. And, really, the “application of MBM” came more in the use of a few mental models early on in the process followed by us “making it up as we went” as opposed to a fully developed tool or anything like that.  So, hopefully, this will be a story where you can learn from my mistakes and see a few ways in which you might be able to apply market-based ideas in your day-to-day life.

Sharing is Caring

A team approached a colleague and me about wanting to clarify their vision.  It’s fair to say that this was a “legacy” program for our organization, so there was a lot of history with it and some fairly entrenched conceptions of what the program was and wasn’t (for better or worse).  Now, a “vision” in my mind is–at the risk of oversimplification–an entity’s view of how it plans to create long-term value.  Our goal here was primarily to help build a shared understanding of the way the program created value among the many people involved in running it–to build a shared vision.  How would we know if we reached those goals?  Well….  We decided on some soft measures like “people will change their RR&Es…people will come up with new, innovative ideas for products that are more in line with the vision…people will stop saying ‘This program is like our other programs, but smaller.’” 

The Process (That We Ignored)

The vision-development mental model that I most frequently now would have been very helpful, had we actually used it.  Instead, we made some classic mistakes in implementing it: primarily, that we overlooked the first, critical step.  That model suggests that you identify what your capabilities are (the knowledge, skills, resources, etc. that you actually have that are useful), then do some due diligence to build a point of view on the market you’ll be operating in and the customers you may interact with, then brainstorm areas where your capabilities overlap with niches in the market, and finally decide on a vision and strategies to implement.

What did we do, instead?  We ended up focusing more on the form instead of the function of this model by spending the large majority of our effort on building a shared vision and communicating it with others.  Don’t get me wrong: building a shared understanding is a key step (at least, it’s been very important in my experience).  But, we probably could have spent more time clarifying why our capabilities fit the opportunities at hand, and then being open to allowing those discussions to change our vision.

Building A Shared Vision

But, like I said, we spent the majority of our time on building a shared understanding.  Here, I think we did some good things.  One of the big takeaways for me was discovering that a “vision” is just a really big mental model that individuals have about what we do.  Since mental models help us filter information and help us see (or blind us from seeing) opportunities, it’s very important to encourage mental models about our business/organization that are useful and shared.  So, we spent time trying to simplify “what we do” to bite-sized statements, and to build metaphors about the vision that could be readily grasped.  After many discussion, the leaders realized that this program boiled down to three big elements that were roughly equally important for success–we started to refer to those as an equilateral triangle, and the idea caught on among the staff and served as a short-hand for the vision.

Really, the biggest bang-for-0ur-buck tactic was to simply invite people to discuss and challenge the vision.  This we did by simply setting up meetings with a mix of staff, rolling out the vision, and then inviting questions.  We did this once before we settled on the “official” vision language (e.g. early on we asked staff involved questions like, ”What do you think the vision of the program is?  What should it be?  What’s most important or most fundamental about what we do? How do you describe what we do to your grandma?”), and then once after the leaders decided on a final statement (e.g. “What are your thoughts?  How would this affect what decisions you make tomorrow? What assumptions are built into this statement we should be aware of?”).  Both discussions were key in helping individuals struggle with and build meaningful associations to the program’s larger goals. 

Lessons Learned?

In the end, my biggest takeaways were to: (a) fully consider capabilities, and be open to changing the vision as needed based on those discussions; (b) make use of the power of metaphor to help build shared mental models; and (c) discussions–and here I mean an open dialogue, not PowerPoints or posters or talking-at-you meetings–with key players helps build a shared vision and is often worth the investment.

Again, I don’t pretend to be an expert here, but the above story is one struggle I’ve had with implementing the ideas of MBM day to day.  I’d love to hear your thoughts on the above, or your stories related to building shared visions.

Core Capabilities, Mental Models, VDP, vision, vision-development process

I was re-reading The Science of Success the other day in preparation for a class, and was struck by a simple phrase on page 59.  “Given the realities of creative destruction….”

From that one little mental model–that is, understanding that things will change whether we want them to or not, and that with change comes new opportunities–spring forth many issues that smart managers consider day to day.  What products, services or strategies need to change?  What new knowledge do I need to be aware of to act on new opportunities?  How can I build in flexibility to my team or projects?

Frequent reader Andrew K (aka AK-47) sent the following interesting video about IBM leaders.  It begins with stating that ”the business world of today is more uncertain and complex than ever before.  79% of [IBM] leaders expect the level of complexity to increase in the next 5 years.”

These leaders claim that “creativity” is the most important leadership attribute needed for success.  Do you agree?  What other attributes might be needed or are more important, given creative destruction?

Change, Creative Destruction, IBM, video