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Badaracco, J. L. (2016).  How to tackle your toughest decisions.  Harvard Business Review, 94(9), 104-107.

Cappelli, P.; Singh, H.; Singh, J. V.; & Useem, M. (2010).  Leadership lessons from India.  Harvard Business Review, 88(3), 90-97.

Francesca, G. (2018).  The business case for curiosity.  Harvard Business Review, 96(5), 48-57.

Furr, N.; Dyer, J. H.; & Nel, K. (2019).  When your moon shots don’t take off.  Harvard Business Review, 97(1), 112-117.

Kanter, R. M. (2011).  Zoom in, zoom out.  Harvard Business Review, 89(3), 112-116.

Vermeulen, F. & Sivanathan, N. (2017).  Stop doubling down on your failing strategy:  How to spot (and escape) one before it’s too late.  Harvard Business Review, 95(6), 110-117.

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The Business Case for Curiosity M ost of the breakthrough discoveries and remarkable inventions throughout history, from flints for starting a fire to self-driving cars, have something in common: They are the result of curiosity. The impulse to seek new information and experiences and explore novel possibilities is a basic human attri­bute. New research points to three important insights about curiosity as it relates to business. First, curiosity is much more important to an enterprise’s performance than was previously thought. That’s because cultivating it at all levels helps leaders and their employees adapt to uncertain market conditions and external pressures: When our curiosity is triggered, we think more deeply and rationally about decisions and come up with more-creative solutions. In addition, curiosity allows leaders to gain more respect from their followers and inspires employees to develop moretrusting and more-collaborative relationships with colleagues. Second, by making small changes to the design of their organizations and the ways they manage their employees, leaders can encourage curiosity—and improve their companies. This is true in every industry and for creative and routine work alike. Third, although leaders might say they treasure inquisitive minds, in fact most stifle curiosity, fearing it will increase risk and inefficiency. In a survey I conducted of more than 3,000 employees from a wide 48 HARVARD BUSINESS REVIEW SEPTEMBER–OCTOBER 2018 FRANCESCA GINO Professor, Harvard Business School range of firms and industries, only about 24% reported feeling curious in their jobs on a regular basis, and about 70% said they face barriers to asking more questions at work. In this article I’ll elaborate on the benefits of and common barriers to curiosity in the workplace and then offer five strategies that can help leaders get high returns on investments in employees’ curiosity and in their own. THE BENEFITS OF CURIOSITY New research reveals a wide range of benefits for organizations, leaders, and employees. Fewer decision-making errors. In my research I found that when our SEPTEMBER–OCTOBER 2018 HARVARD BUSINESS REVIEW 49 SPOTLIGHT THE BUSINESS CASE FOR CURIOSITY curiosity is triggered, we are less likely to fall prey to confirmation bias (looking for information that supports our beliefs rather than for evidence suggesting we are wrong) and to stereotyping people (making broad judgments, such as that women or minorities don’t make good leaders). Curiosity has these positive effects because it leads us to generate alternatives. More innovation and positive changes in both creative and noncreative jobs. Consider this example: In a field study INSEAD’s Spencer Harrison and colleagues asked artisans selling their goods through an e‑commerce website several questions aimed at assessing the curiosity they experience at work. After that, the participants’ creativity was measured by the number of items they created and listed over a two-week period. A one‑unit increase in curiosity (for instance, a score of 6 rather than 5 on a 7-point scale) was associated with 34% greater creativity. In a separate study, Harrison and his colleagues focused on call centers, where jobs tend to be highly structured and turnover is generally high. They asked incoming hires at 10 organizations to complete a survey that, among other things, measured their curiosity before they began their new jobs. Four weeks in, the employees were surveyed about various aspects of their work. The results showed that the most curious employees sought the most information from coworkers, and the information helped them in their jobs—for instance, it boosted their creativity in addressing customers’ concerns. My own research confirms that encouraging people to be curious generates workplace improvements. For one study I recruited about 200 employees working in various companies and industries. Twice a week for four weeks, half of them received a text message at the start of their workday that read, “What is one topic or activity you are curious about today? What is one thing you usually take for granted that you want to ask about? Please make sure you ask a few ‘Why questions’ as you engage in your work throughout the day. Please set aside a few minutes to identify how you’ll approach your work today with these questions in mind.” The other half (the control group) received a message designed to trigger reflection but not raise their curiosity: “What is one topic or activity you’ll engage in today? What is one thing you usually work on or do that you’ll also complete today? Please make sure you think about this as you engage in your work throughout the day. Please set aside a few minutes to identify how you’ll approach your work today with these questions in mind.” After four weeks, the participants in the first group scored higher than the others on questions assessing their innovative behaviors at work, such as whether they had made constructive suggestions for implementing solutions to pressing organizational problems. When we are curious, we view tough situations more creatively. Studies have found that curiosity is associated with less defensive reactions to stress and less aggressive reactions to provocation. We also perform better when we’re curious. In a study of 120 employees I found that natural curiosity was associated with better job performance, as evaluated by their direct bosses. Reduced group conflict. My research found that curiosity encourages members of a group to put themselves in one another’s shoes and take an interest in one another’s ideas rather than focus only on their own perspective. That causes them to work together more effectively and smoothly: Conflicts are less heated, and groups achieve better results. More-open communication and better team performance. Working with executives in a leadership program at Harvard Kennedy School, my colleagues and I divided participants into groups of five or six, had some groups participate in a task that heightened their curiosity, and then asked all the groups to engage in a simula‑ tion that tracked performance. The groups whose curiosity had been heightened performed better than the control groups because they shared information more openly and listened more carefully. ► Idea In Brief ► THE PROBLEM Leaders say they value employees who question or explore things, but research shows that they largely suppress curiosity, out of fear that it will increase risk and undermine efficiency. ► WHY THIS MATTERS Curiosity improves engagement and collaboration. Curious people make better choices, improve their company’s performance, and help their company adapt to uncertain market conditions and external pressures. 50 HARVARD BUSINESS REVIEW SEPTEMBER–OCTOBER 2018 ► THE REMEDY Leaders should encourage curiosity in themselves and others by making small changes to the design of their organization and the ways they manage their employees. Five strategies can guide them. TWO BARRIERS TO CURIOSITY Despite the well-established benefits of curiosity, organizations often discourage it. This is not because leaders don’t see its value. On the contrary, both leaders and employees understand that curios‑ ity creates positive outcomes for their companies. In the survey of more than 3,000 employees mentioned earlier, 92% SPOTLIGHT THE BUSINESS CASE FOR CURIOSITY When we are curious, we view tough situations more creatively and have less defensive reactions to stress. credited curious people with bringing new ideas into teams and organizations and viewed curiosity as a catalyst for job satisfaction, motivation, innovation, and high performance. Yet executives’ actions often tell a different story. True, some organizations, including 3M and Facebook, give employees free time to pursue their interests, but they are rare. And even in such organizations, employees often have challenging shortterm performance goals (such as meeting a quarterly sales target or launching a new product by a certain date) that consume the “free time” they could have spent exploring alternative approaches to their work or coming up with innovative ideas. Two tendencies restrain leaders from encouraging curiosity: They have the wrong mindset about exploration. Leaders often think that letting employees follow their curiosity will lead to a costly mess. In a recent survey I conducted of 520 chief learning officers and chief talent development officers, I found that they often shy away from encouraging curiosity because they believe the company would be harder to manage if people were allowed to explore their own interests. They also believe that disagreements would arise and making and executing decisions would slow down, raising the cost of doing business. Research finds that although people list creativity as a goal, they frequently reject creative ideas when actually presented with them. That’s understandable: Exploration often involves questioning the status quo and doesn’t always produce useful information. But it also means not settling for the first possible solution—and so it often yields better remedies. They seek efficiency to the detriment of exploration. In the early 1900s Henry Ford focused all his efforts on one goal: reducing production costs to create a car for the masses. By 1908 he had realized that vision with the introduction of the Model T. Demand grew so high that by 1921 the company was producing 56% of all passenger cars in the United States—a remarkable success made possible primarily by the firm’s efficiency-centered model of work. But in the late 1920s, as the U.S. economy rose to new heights, consumers started wanting greater variety in their cars. While Ford remained fixated on improving the Model T, competitors such as General Motors started producing an array of models and soon captured the main share of the market. Owing to its single-minded focus on efficiency, Ford stopped experimenting and innovating and fell behind. These leadership tendencies help explain why our curiosity usually declines the longer we’re in a job. In one survey, I asked about 250 people who had recently started working for various companies a series of questions designed to measure curiosity; six months later I administered a follow-up survey. Although initial levels of curiosity varied, after six months everyone’s curiosity had dropped, with the average decline exceeding 20%. Because people were under pressure to complete their work quickly, they had little time to ask questions about broad processes or overall goals. FIVE WAYS TO BOLSTER CURIOSITY It takes thought and discipline to stop stifling curiosity and start fostering it. Here are five strategies leaders can employ. 1 Hire for curiosity. 52 HARVARD BUSINESS REVIEW SEPTEMBER–OCTOBER 2018 In 2004 an anonymous billboard appeared on Highway 101, in the heart of Silicon Valley, posing this puzzle: “{first 10-digit prime found in consecutive digits of e}.com.” The answer, 7427466391.com, led the curious online, where they found another equation to solve. The handful of people who did so were invited to submit a résumé to Google. The company took this unusual approach to finding job candidates because it places a premium on curiosity. (People didn’t even need to be engineers!) As Eric Schmidt, Google’s CEO from 2001 to 2011, has said, “We run this company on questions, not answers.” Google also identifies naturally curious people through interview questions such as these: “Have you ever found yourself unable to stop learning something you’ve never encountered before? Why? What kept you persistent?” The answers usually highlight either a specific purpose driving the candidate’s inquiry (“It was my job to find the answer”) or genuine curiosity (“I just had to figure out the answer”). IDEO, the design and consulting company, seeks to hire “T-shaped” employees: people with deep skills that allow them to contribute to the creative process (the vertical stroke of the T) and a predisposition for collaboration across disciplines, a quality requiring empathy and curiosity (the horizontal stroke of the T). The firm understands that empathy and curiosity are related: Empathy allows employees to listen thoughtfully and see problems or decisions from another person’s perspective, while curiosity extends to interest in other people’s disciplines, so much so that one may start to practice them. And it recognizes that most people perform at their best not because they’re specialists but because their deep skill is accompanied by an intellectual curiosity that leads them to ask questions, explore, and collaborate. To identify potential employees who are T-shaped, IDEO pays attention to how candidates talk about past projects. Someone who focuses only on his or her own contributions may lack the breadth to appreciate collaboration. T-shaped candidates are more likely to talk about how they succeeded with the help of others and to express interest in working collaboratively on future projects. To assess curiosity, employers can also ask candidates about their interests outside of work. Reading books unrelated to one’s own field and exploring questions just for the sake of knowing the answers are indications of curiosity. And companies can administer curiosity assessments, which have been validated in a myriad of studies. These generally measure whether people explore things they don’t know, analyze data to uncover new ideas, read widely beyond their field, have diverse interests outside work, and are excited by learning opportunities. It’s also important to remember that the questions candidates ask—not just the answers they provide—can signal curiosity. For instance, people who want to know about aspects of the organization that aren’t directly related to the job at hand probably have more natural curiosity than people who ask only about the role they would perform. 2 Model inquisitiveness. Leaders can encourage curiosity throughout their organizations by being inquisitive themselves. In 2000, when Greg Dyke had been named director general of the BBC but hadn’t yet assumed the position, he spent five months visiting the BBC’s major locations, assembling the staff at each stop. Employees expected a long presentation but instead got a simple question: “What is the one thing I should do to make things better for you?” Dyke would listen carefully and then ask, “What is the one thing I should do to make things better for our viewers and listeners?” The BBC’s employees respected their new boss for taking the time to ask questions and listen. Dyke used their responses to inform his thinking about the changes needed to solve problems facing the BBC and to identify what to work on first. After officially taking the reins, he gave a speech to the staff that reflected what he had learned and showed employees that he had been truly interested in what they said. By asking questions and genuinely listening to the responses, Dyke modeled the importance of those behaviors. He also highlighted the fact that when we are exploring new terrain, listening is as important as talking: It helps us fill gaps in our knowledge and identify other questions to investigate. That may seem intuitive, but my research shows that we often prefer to talk rather than to listen with curiosity. For instance, when I asked some 230 high-level leaders in executive education classes what they would do if confronted with an organizational crisis stemming from both financial and cultural issues, most said they would take action: move to stop the financial bleeding and introduce initiatives to refresh the culture. Only a few said they would ask questions rather than simply impose their ideas on others. Management books commonly encourage leaders assuming new positions to communicate their vision from the start rather than ask employees how they can be most helpful. It’s bad advice. Why do we refrain from asking questions? Because we fear we’ll be judged incompetent, indecisive, or unintelligent. Plus, time is precious, and we don’t want to bother people. Experience and expertise exacerbate the problem: As people climb the organizational ladder, they think they have less to learn. Leaders also tend to believe they’re expected to talk and provide answers, not ask questions. Such fears and beliefs are misplaced, my recent research shows. When we demonstrate curiosity about others by asking questions, people like us more and view us as more competent, and the heightened trust makes our relationships more interesting and intimate. By asking questions, we promote more-meaningful connections and more-creative outcomes. Another way leaders can model curiosity is by acknowledging when they don’t know the answer; that makes it clear that it’s OK to be guided by curiosity. Patricia Fili‑Krushel told me that when she joined WebMD Health as chief executive, she met with a group of male engineers in Silicon Valley. They were doubtful that she could add value to their work and, right off the bat, asked what she knew about engineering. Without hesitation, Fili‑Krushel made a zero with her fingers. “This is how much I know about engineering,” she told them. “However, I do know how to run businesses, and I’m hoping you can teach me what I need to know about your world.” When leaders concede that they don’t have the answer to a question, they show that they value the process of looking for answers and motivate others to explore as well. New hires at Pixar Animation Studios are often hesitant to question the status quo, given the company’s track rec­ord of hit movies and the brilliant work of those who have been there for years. To combat that tendency, Ed Catmull, the cofounder and SEPTEMBER–OCTOBER 2018 HARVARD BUSINESS REVIEW 53 SPOTLIGHT THE BUSINESS CASE FOR CURIOSITY president, makes a point of talking about times when Pixar made bad choices. Like all other organizations, he says, Pixar is not perfect, and it needs fresh eyes to spot opportunities for improvement (see “How Pixar Fosters Collective Creativity,” HBR, September 2008). In this way Catmull gives new recruits license to question existing practices. Recognizing the limits of our own knowledge and skills sends a powerful signal to others. Tenelle Porter, a postdoctoral scholar in psychology at the University of California, Davis, describes intellectual humility as the ability to acknowledge that what we know is sharply limited. As her research demonstrates, higher levels of intellectual humility are associated with a greater willingness to consider views other than our own. People with more intellectual humility also do better in school and at work. Why? When we accept that our own knowledge is finite, we are more apt to see that the world is always changing and that the future will diverge from the pres­ent. By embracing this insight, leaders and employees can begin to recognize the power of exploration. Finally, leaders can model inquisitiveness by approaching the unknown with curiosity rather than judgment. Bob Langer, who heads one of MIT’s most productive laboratories, told me recently that this principle guides how he manages his staff. As human beings, we all feel an urge to evaluate others— often not positively. We’re quick to judge their ideas, behaviors, and perspectives, even when those relate to things that haven’t been tried before. Langer avoids this trap by raising questions about others’ ideas, which leads people to think more deeply about their perspective and to remain curious about the tough problems they are trying to tackle. In doing so, he is modeling behavior that he expects of others in the lab. 54 HARVARD BUSINESS REVIEW SEPTEMBER–OCTOBER 2018 3 Emphasize learning goals. When I asked Captain Chesley “Sully” Sullenberger how he was able to land a commercial aircraft safely in the Hudson River, he described his passion for contin­ uous learning. Although commercial flights are almost always routine, every time his plane pushed back from the gate he would remind himself that he needed to be prepared for the unexpected. “What can I learn?” he would think. When the unexpected came to pass, on a cold January day in 2009, Sully was able to ask himself what he could do, given the available options, and come up with a creative solution. He successfully fought the tendency to grasp for the most obvious option (landing at the nearest airport). Especially when under pressure, we narrow in on what immediately seems the best course of action. But those who are passionate about continuous learning contemplate a wide range of options and perspectives. As the accident report shows, Sully carefully considered several alternatives in the 208 seconds between his discovery that the aircraft’s engines lacked thrust and his landing of the plane in the Hudson. It’s natural to concentrate on results, especially in the face of tough challenges. But focusing on learning is generally more beneficial to us and our organizations, as some landmark studies show. For example, when U.S. Air Force personnel were given a demanding goal for the number of planes to be landed in a set time frame, their performance decreased. Similarly, in a study led by Southern Methodist University’s Don VandeWalle, sales professionals who were naturally focused on performance goals, such as meeting their targets and being seen by colleagues as good at their jobs, did worse during a promotion of a product (a piece of medical equipment priced at about $5,400) than reps who were naturally SEPTEMBER–OCTOBER 2018 HARVARD BUSINESS REVIEW 55 SPOTLIGHT THE BUSINESS CASE FOR CURIOSITY focused on learning goals, such as exploring how to be a better salesperson. That cost them, because the company awarded a bonus of $300 for each unit sold. A body of research demonstrates that framing work around learning goals (developing competence, acquiring skills, mastering new situations, and so on) rather than performance goals (hitting targets, proving our competence, impressing others) boosts motivation. And when motivated by learning goals, we acquire more-diverse skills, do better at work, get higher grades in college, do better on problem-solving tasks, and receive higher ratings after training. Unfortunately, organizations often prioritize performance goals. Leaders can help employees adopt a learning mindset by communicating the importance of learning and by rewarding people not only for their performance but for the learning needed to get there. Deloitte took this path: In 2013 it replaced its performance management system with one that tracks both learning and performance. Employees meet regularly with a coach to discuss their development and learning along with the support they need to continually grow. Leaders can also stress the value of learning by reacting positively to ideas that may be mediocre in themselves but could be springboards to better ones. Writers and directors at Pixar are trained in a technique called “plussing,” which involves building on ideas without using judgmental lang­uage. Instead of rejecting a sketch, for example, a director might find a starting point by saying, “I like Woody’s eyes, and what if we...?” Someone else might jump in with another “plus.” This technique allows people to remain curious, listen actively, respect the ideas of others, and contribute their own. By promoting a process that allows all sorts of ideas to be explored, leaders send a clear message that learning is a key goal even if it doesn’t always lead to success. 4 Let employees explore and broaden their interests. Organizations can foster curiosity by giving employees time and resources to explore their interests. One of my favorite examples comes from my native country. It involves Italy’s first typewriter factory, Olivetti, founded in 1908 in the foothills of the Italian Alps. In the 1930s some employees caught a coworker leaving the factory with a bag full of iron pieces and machinery. They accused him of stealing and asked the company to fire him. The worker told the CEO, Adriano Olivetti, that he was taking the parts home to work on a new machine over the weekend because he didn’t have time while performing his regular job. Instead of firing him, Olivetti gave him time to create the machine and charged him with overseeing its production. The result was Divisumma, the first electronic calculator. Divisumma sold well worldwide in the 1950s and 1960s, and Olivetti promoted the worker to technical director. Unlike leaders who would have shown him the door, Olivetti gave him the space to explore his curiosity, with remarkable results. Some organizations provide resources to support employees’ outside interests. Since 1996 the manufacturing conglomerate United Technologies (UTC) has given as much as $12,000 in tuition annually to any employee seeking a degree part-time—no strings attached. Leaders often don’t want to invest in training employees for fear that they will jump to a competitor and take their expensively acquired skills with them. Even though UTC hasn’t tried to quantify the benefits of its tuition reimbursement program, Gail Jackson, the vice president of human resources when we spoke, believes 56 HARVARD BUSINESS REVIEW SEPTEMBER–OCTOBER 2018 in the importance of curious employees. “It’s better to train and have them leave than not to train and have them stay,” she told me. But according to the Society for Human Resource Management’s 2017 employee benefits report, only 44% of organizations provide or support crosstraining to develop skills not directly related to workers’ jobs. Leaders might provide opportunities for employees to travel to unfamiliar locales. When we have chances to expand our interests, research has found, we not only remain curious but also become more confident about what we can accomplish and more successful at work. Employees can “travel” to other roles and areas of the organization to gain a broader perspective. At Pixar, employees across the organization can provide “notes”—questions and advice—that help directors consider all sorts of possibilities for the movies they are working on. Employees can also broaden their interests by broadening their networks. Curious people often end up being star performers thanks to their diverse networks, my research with the University of Toronto’s Tiziana Casciaro, Bill McEvily, and Evelyn Zhang finds. Because they’re more comfortable than others asking questions, such people more easily create and nurture ties at work—and those ties are critical to their career development and success. The organization benefits when employees are connected to people who can help them with challenges and motivate them to go the extra mile. MIT’s Bob Langer works to raise curiosity in his students by introducing them to experts in his network. Similarly, by connecting people across organizational departments and units, leaders can encourage employees to be curious about their colleagues’ work and ways of doing business. Deliberate thinking about workspaces can broaden networks and encourage the Leaders can stress the value of learning by reacting positively to mediocre ideas that could be springboards to better ones. cross-pollination of ideas. In the 1990s, when Pixar was designing a new home for itself in Emeryville, across the bay from San Francisco, the initial plans called for a separate building for each department. But then-owner Steve Jobs had concerns about isolating the various departments and decided to build a single structure with a large atrium in the center, containing employee mailboxes, a café, a gift shop, and screening rooms. Forcing employees to interact, he reasoned, would expose them to one another’s work and ideas. Leaders can also boost employees’ curiosity by carefully designing their teams. Consider Massimo Bottura, the owner of Osteria Francescana, a three-Michelinstar restaurant in Modena, Italy, that was rated the Best Restaurant in the World in 2016 and 2018. His sous chefs are Davide di Fabio, from Italy, and Kondo Takahiko, from Japan. The two differ not only in their origins but also in their strengths: Di Fabio is more comfortable with improvisation, while Takahiko is obsessed with precision. Such “collisions” make the kitchen more innovative, Bottura believes, and inspire curiosity in other workers. 5 Have “Why?” “What if…?” and “How might we…?” days. The inspiration for the Polaroid instant camera was a three-year-old’s question. Inventor Edwin Land’s daughter was impatient to see a photo her father had just snapped. When he explained that the film had to be processed, she wondered aloud, “Why do we have to wait for the picture?” As every parent knows, Why? is ubiqui­ tous in the vocabulary of young children, who have an insatiable need to understand the world around them. They aren’t afraid to ask questions, and they don’t worry about whether others believe they should already know the answers. But as children grow older, self-consciousness creeps in, along with the desire to appear confident and demonstrate expertise. By the time we’re adults, we often suppress our curiosity. Leaders can help draw out our innate curiosity. One company I visited asked all employees for “What if…?” and “How might we…?” questions about the firm’s goals and plans. They came up with all sorts of things, which were discussed and evaluated. As a concrete sign that questioning was supported and rewarded, the best questions were displayed on banners hung on the walls. Some of the questions led employees to suggest ideas for how to work more effectively. (For more on the importance of asking good questions before seeking solutions, see “Better Brainstorming,” HBR, March–April 2018.) In one study, my colleagues and I asked adults working in a wide range of jobs and industries to read one of two sets of materials on three organizational elements: goals, roles, and how organizations as a whole work together. For half the workers, the information was presented as the “grow method”—our version of a control condition. We encouraged that group to view those elements as immutable, and we stressed the importance of following existing processes that managers had already defined. For the other half, the information was presented as the “go back method.” We encouraged those employees to see the elements as fluid and to “go back” and rethink them. A week later we found that the workers who’d read about the “go back method” showed more creativity in tasks than the workers in the “grow method” group. They were more open to others’ ideas and worked more effectively with one another. To encourage curiosity, leaders should also teach employees how to ask good questions. Bob Langer has said he wants to “help people make the transition from giving good answers to asking good questions” (see “The Edison of Medicine,” HBR, March–April 2017). He also tells his students that they could change the world, thus boosting the curiosity they need to tackle challenging problems. Organizing “Why?” days, when employ­ees are encouraged to ask that question if facing a challenge, can go a long way toward fostering curiosity. Intellectual Ventures, a company that generates inventions and buys and licenses patents, organizes “invention sessions” in which people from different disciplines, backgrounds, and levels of expertise come together to discuss potential solutions to tough problems, which helps them consider issues from various angles (see “Funding Eureka!” HBR, March 2010). Similarly, under Toyota’s 5 Whys approach, employees are asked to investigate problems by asking Why? After coming up with an answer, they are to ask why that’s the case, and so on until they have asked the question five times. This mindset can help employees innovate by challenging existing perspectives. IN MOST ORGANIZATIONS, leaders and em­ployees alike receive the implicit message that asking questions is an unwanted challenge to authority. They are trained to focus on their work without looking closely at the process or their overall goals. But maintaining a sense of wonder is crucial to creativity and innovation. The most effective leaders look for ways to nurture their employees’ curiosity to fuel learning and HBR Reprint R1805B discovery.  FRANCESCA GINO is the Tandon Family Professor of Business Administration at Harvard Business School and the author of the books Rebel Talent: Why It Pays to Break the Rules at Work and in Life and Sidetracked: Why Our Decisions Get Derailed, and How We Can Stick to the Plan. SEPTEMBER–OCTOBER 2018 HARVARD BUSINESS REVIEW 57 Harvard Business Review Notice of Use Restrictions, May 2009 Harvard Business Review and Harvard Business Publishing Newsletter content on EBSCOhost is licensed for the private individual use of authorized EBSCOhost users. It is not intended for use as assigned course material in academic institutions nor as corporate learning or training materials in businesses. Academic licensees may not use this content in electronic reserves, electronic course packs, persistent linking from syllabi or by any other means of incorporating the content into course resources. Business licensees may not host this content on learning management systems or use persistent linking or other means to incorporate the content into learning management systems. Harvard Business Publishing will be pleased to grant permission to make this content available through such means. For rates and permission, contact permissions@harvardbusiness.org. Ind Leadership Lessons from 90 Harvard Business Review March 2010 1012 Mar10 Cappelli.indd 90 1/28/10 2:17:37 PM HBR.ORG How the best Indian companies drive performance by investing in people. by Peter Cappelli, Harbir Singh, Jitendra V. Singh, and Michael Useem V ILLUSTRATION: JACQUI OAKLEY ia 1012 Mar10 Cappelli.indd 91 Vineet Nayar, CEO of the Indian IT services giant HCL, likes to rock the boat. Asked what he wished his greatest legacy to be in five years, Nayar responded without missing a beat: “That I have destroyed the office of the CEO.” He led the charge that gave rise to the company’s bracing motto, “Employee first, customer second”—an idea that would give many managers hives. And he invited employees to evaluate their bosses and their bosses’ bosses; then he posted his own review on the firm’s intranet for all to see, and urged others to follow his lead. What’s Nayar up to? Pressed to explain, he told us that he sought enough “transparency” and “empowerment” in the company that “decisions would be made at the points where the decisions should be made”—that is, by employees, where the company meets the client. Ideally, he said, “the organization would be inverted, where the top is accountable to the bottom, and therefore the CEO’s office will become irrelevant.” Nayar might be dismissed as a loosely tethered idealist except that his company, with nearly 55,000 employees and a market cap of $24 billion, is growing even faster than India’s red-hot economy. He’s doing something right, and, as we found in a yearlong study of Indian executives, his leadership approach is closer than not to the norm among India’s biggest and fastest-growing companies. To discover how Indian leaders drive their organizations to high performance, our research team interviewed senior executives at 98 of the largest India-based companies. (See the sidebar “How We Did Our Study.”) In conversations with leaders at Infosys, Reliance Industries, Tata, Mahindra & Mahindra, Aventis Pharma, and many others, a picture emerged of a distinctive Indian model. None of the people we interviewed suggested that their companies had succeeded because of their own cleverness at strategy or even because of the efforts of a top team. They didn’t mention skill in financial markets, mergers and acquisitions, or deal making— talents that Western CEOs often claim underpin their March 2010 Harvard Business Review 91 1/28/10 2:17:52 PM LEADERSHIP LESSONS FROM INDIA companies’ performance. Almost without exception, these leaders, like Nayar, said their source of competitive advantage lay deep inside their companies, in their people. That may sound like posturing, but our research puts hard numbers on the characteristic ways Indian leaders invest in people. Far more than their Western counterparts, these leaders and their organizations take a long-term, internally focused view. They work to create a sense of social mission that is served when the business succeeds. They make aggressive investments in employee development, despite tight labor markets and widespread job-hopping. And they strive for a high level of employee engagement and openness. This is not to say that Indian firms and their leaders are inordinately virtuous. Corruption and malfeasance can be found in the Indian business community as surely as in any other. (Note, for instance, the scandal involving Satyam Computer and its chairman and founder, Ramalinga Raju, who was jailed on charges of misleading investors.) Not all Indian executives are saints or sages, just as not all U.S. CEOs single-mindedly pursue shareholder value while ignoring social concerns. Still, the leaders of the most successful Indian companies do engage with their country, culture, and employees in a characteristic way, and this is an important factor in their performance. Their approach is used often enough that, we believe, it constitutes the centerpiece of a clear model—one from which Western leaders can learn. Although India’s competitive environment is relatively new, company leaders have brought to it a long-standing tradition of business largesse—a commitment to social goals fueled by enlightened self-interest. That mind-set is embedded in Hindustan Unilever’s Project Shakti, for example, which applied microfinance principles to create a sales force in some of the subcontinent’s most remote and economically challenged regions. And it’s revealed in hospitals, grade schools, and virtual universities built across the country by leading businesses. Leading the India Way Our survey revealed an important difference between Indian and Western company leaders in how they focus their energy. When we asked Indian leaders to prioritize their key responsibilities, this is how they ranked the top four: 1. Chief input for business strategy Skills Indian Leaders Value Most When asked which qualities had been most critical to their exercise of leadership over the past five years, % 61 of Indian leaders said envisioning and articulating a path to the future; strategic thinking; guiding change % 57 said being inspirational, accountable, and entrepreneurial 52 % said supporting careful talent selection, grooming, and practices that advance business goals 43 % said optimizing organizational structure and articulating core values 22 % said understanding competitors and markets; managing outside relations 2. Keeper of organizational culture 3. Guide, teacher, or role model for employees 4. Representative of owner and investor interests It’s striking that they put shareholders in fourth place, since U.S. executives are all but required to say that shareholder interests are their number one concern. This low ranking held for even the most global of the companies we studied, which are exposed to international capital markets and in some cases listed on U.S. stock exchanges. And it held for leaders such as Anand Mahindra, Sunil Bharti Mittal, and Azim Premji, who are huge shareholders in their own companies. The higher priority these executives place on keeping the culture and guiding and teaching employees underscores their focus on human capital development. As the exhibit “Skills Indian Leaders Value Most” shows, this focus also emerged in their responses to our question “What are the top two leadership capacities most critical to your exercise of leadership over the past five years?” Given their intense focus on culture and human capital, it may be surprising that the Indian leaders cited strategy as their top priority. But strategy also emerged as important in another of our surveys, which explored changes in U.S. and Indian top executives’ allocation of time over the past five years. As the exhibit “A Stark Difference in Focus” shows, U.S. executives became increasingly attentive to external demands—regulatory concerns, the board, and shareholders—whereas fewer than half of the Indian executives gave additional attention to these, and the overwhelming majority said they spent more time on setting strategy. It’s important to understand how Indian leaders see their role in strategy development. Whereas Western leaders often leave it to profit-center heads, Indian leaders are likely to own the strategy function, setting the agenda and taking a visible role in shaping the strategies their managers bring to them. They tend to focus less on Western-style planning and analysis and more on creating the incentives, organizational structures, and culture that will enable an improvisational approach to strategy. They view strategy as a set of enduring general principles for competing, such as developing competencies, embracing social purpose, and taking the long view—an approach to business that they personally encode in the company’s culture. This model both enhances a company’s agility in the marketplace and allows Indian leaders to develop their top managers. Thus 92 Harvard Business Review March 2010 1012 Mar10 Cappelli.indd 92 1/28/10 2:17:59 PM HBR.ORG Idea in Brief The leaders of India’s biggest and fastest-growing companies take an internally focused, long-term view and put motivating and developing employees higher on the priority list than short-term shareholder interests. strategy and “guiding and teaching” are complementary priorities. Ratan Tata set a new strategic course for the Tata Group when he took it over, in 1991. At the time, it was doing virtually no business outside India. Against some internal opposition, he asserted that the company had to go global, in part to reduce the risk of dependence on a single country’s economy. Beginning in 2000, he led the conglomerate’s 96 companies on a wave of acquisitions, using a caseby-case, trial-and-error approach to acquire, for ex- A STARK DIFFERENCE IN FOCUS Over the past five years, Indian leaders began spending more time on internal issues, while U.S. CEOs spent more time on external affairs. CEOS WHO ARE DEVOTING LESS TIME CEOS WHO ARE DEVOTING MORE TIME REGULATORY ISSUES 2% 24% 1% 17% 4% U.S. CEOS INDIAN CEOS REPORTING TO THE BOARD 78% 41% SHAREHOLDER RELATIONS 58% 31% 9% 0% 11% 17% 27% 55% 98% 41% 41% SETTING STRATEGY 47% 93% MEDIA RELATIONS 31% 31% DAY-TO-DAY MANAGEMENT 28% 24% To engage employees, these leaders create a sense of social mission that is central to company culture, encourage openness by developing and personally modeling systems that provide transparency, empower employees by enabling communication and pushing decision making down through the ranks, and invest heavily in training. These individual practices aren’t new, but Indian leaders combine them in a coherent package and give them consistent emphasis. The authors advise that Western leaders adapt this managerial approach to their own circumstances, pursuing in particular two readily achievable goals: investing in training, and strengthening social mission. ample, the Tetley Group, the Daewoo Commercial Vehicle Company, and Boston’s Ritz-Carlton hotel (now the Taj Boston). Half the Tata Group’s revenue comes from other countries. This globalization was accomplished not by an explicit, careful strategy but by Ratan Tata’s personal vision for how to compete across international markets. Consider the development of the Nano. For this affordable car, the decision about pricing and, therefore, market positioning (a typical focus of Western strategy) came about by accident: A reporter asked about price, and Tata’s off-the-cuff guesstimate that the Nano might cost 100,000 rupees ($2,000) made headlines the next day. So Tata decided that 100,000 rupees might as well be the goal, and the company’s managers and engineers set to work, unsure exactly how they’d meet the target. Persistently improvising around obstacles, an approach captured by the Hindi word jugaad, they cut costs at every turn—for example, by repurposing scooter parts and eliminating extras such as power windows. Motivating Employees To get some hard data on Indian leaders’ style, we asked the directors of human resources at our executives’ companies to assess their top bosses using the Multifactor Leadership Questionnaire (MLQ), the most widely applied such tool in the United States. Perhaps not surprisingly, the executives scored high on “transformational” or charismatic leadership designed to encourage employees to care about the goals of the leader and the organization. When we compared these data with MLQ data for U.S. CEOs, we found that the latter were more likely to use “transactional” styles—motivating employees to act in the interests of the business by striking deals with them (If you want a promotion, meet these sales targets). The leaders we surveyed typically attributed the success of their companies to employees’ positive March 2010 Harvard Business Review 93 1012 Mar10 Cappelli.indd 93 1/28/10 2:18:04 PM LEADERSHIP LESSONS FROM INDIA In India, CSR is a reputational asset. Obtaining industrial licenses and environmental clearance can depend on being known for public responsibility. Achieving CSR Targets Our research revealed striking differences between Indian and U.S. companies in attention paid to this goal. ROUTINELY MONITOR PROGRESS INDIAN COMPANIES 40 % 17 % U.S. COMPANIES RARELY MONITOR PROGRESS INDIAN COMPANIES 15 45% % U.S. COMPANIES attitudes, persistence, and sense of reciprocity, which the executives inspire in four specific ways. Creating a sense of mission. As we’ve observed, Indian leaders have long been involved in societal issues, preemptively investing in community services and infrastructure. Mallika Srinivasan, the director of Tractors & Farm Equipment, told us that almost everywhere companies operate in India they are encircled by throngs of destitute people, needs are stark, and government intervention is inadequate. Like Infosys and many other big companies, Tractors & Farm Equipment maintains a first-world, campuslike facility within sight of thirdworld slums. “Corporate social responsibility and good governance are related to the state of the development of the country,” she told us. “We are all seeing these islands of prosperity surrounded by so much poverty.” Echoing a sentiment we heard from many executives, Srinivasan explained that her company feels duty bound to step forward. Some of this CSR is driven by necessity, of course; national well-being and investment in social goals and human capital are essential to companies’ competitiveness. The rapid growth of the Indian market and the inadequate scale of health and education systems have forced companies to develop and help care for their own talent. Social investment pays off in other ways, too. For B. Muthuraman, the managing director of Tata Steel, CSR is a reputational asset. “Our history in corporate social responsibility,” he acknowledges, “has enhanced the group brand.” And for some, acting responsibly in the eyes of regulators is essential: Obtaining industrial licenses and environmental clearance in the United States can be a straightforward, if technical, process, whereas in India it can depend on being known for public responsibility. Unlike the feel-good statements that Western companies make about, say, improving customers’ lives, the social missions of Indian companies are integral to their strategy and often the route to profits. A case in point: The hospital group Narayana Hrudayalaya was founded by Devi Shetty to help the thousands of Indian children who need cardiac surgery but can’t afford it. The group soon discovered that the only way to provide quality operations cheaply was to standardize them, so it set about learning to perform them at scale. It now performs more than twice as many cardiac surgeries as the biggest U.S. hospital, with outcomes at least as good and at about one-tenth the cost, and its profit margins are slightly above those of its U.S. peers. Prathap Reddy, the founder of Apollo Hospitals, a leading private health care provider, conveys a similar mission-as-means orientation in his comment “Our first responsibility is to our patients; second, to people who work for us; and then to our lenders and investors.” Other Indian companies similarly interweave strategy and social mission. The telecommunications provider Bharti Airtel sees its mission as getting cell phones into the hands of the hundreds of millions of people in India who otherwise have no way to communicate with one another. Max India’s new insurance product, Max Vijay, combines life insurance with savings in a model that allows people with erratic incomes to pay whatever they can, whenever they can. IT companies such as Cognizant and Infosys describe their social mission in part as showing the world that India and Indian companies can compete and win on the international stage. Finally, more so than most Western companies, the best Indian companies have a social mission and a sense of national purpose because that helps employees find meaning in their work. Missions motivate by tapping into what organizational psychologists call task significance—a satisfying feeling that small tasks link to the bigger goal. U.S. President Lyndon Johnson loved to tell a story about asking a truck driver who worked at NASA in the 1960s what his job was. The driver’s response: “I’m helping to put a man on the moon.” Engaging through transparency and accountability. Indian leaders also build employee commitment by encouraging openness and reciprocity. They look after the interests of employees and their families, and implicitly (or sometimes explicitly) ask employees to look after the company’s interests in return. HCL’s “Employee first, customer 94 Harvard Business Review March 2010 1012 Mar10 Cappelli.indd 94 1/28/10 2:18:09 PM HBR.ORG second” policy, supported by initiatives designed to make employees feel more personally responsible for the company’s offerings and give them a voice with upper management, does exactly this. Vineet Nayar’s public 360-degree reviews for managers is another example. The software company MindTree posts accounts of its employees’ ethical failures and violations of company policy on the internet and discusses the resulting lessons. The company’s executive chairman, Ashok Soota, tells employees in an introduction to the company’s booklet All About Integrity: “This book is placed in your hands as a rite of passage…. adherence to the Integrity Policy becomes the basic social contract of our mutual existence.” There they can read about “some of the dark, difficult moments that were created by people who breached Integrity”: the lying accountant, the inside trader, the senior executive who misused his company cell phone, and the dozens of employees caught falsifying prior work experience—all of whom were asked to leave. The motivational message is clear: Employees are accountable to management, and management is equally accountable to them. Empowering through communication. So that engagement will translate into action, Indian leaders go to considerable lengths to empower employees, although this challenges the traditional Indian deference to hierarchy. At HCL, for example, an online system allows employees to create qualitycontrol “tickets,” much like those on an assembly line. These can flag product-quality problems or even personal issues related to management, such as “I have a problem with my bonus” or “My boss sucks.” Employees can also post comments and questions on the company’s “U and I” website; Nayar himself publicly answers some 50 questions a month. Tata Consultancy Services has a similar system whereby employees can submit grievances about management, which may be settled through arbitration. In his comments about empowering employees by helping them find their own solutions, Jagdish Khattar, the former managing director of the automaker Maruti Udyog, echoes a sentiment common among Indian leaders: “Throw issues to them, let them examine and come back to you with solutions. I have done it again and again.…85% of their solution would be what you have in mind….Let them go back with the impression that 100% of the solution is theirs. The implementation would be quick and smooth, and they will feel very proud of it, but it serves your purpose.” This management strategy helped revitalize Bank of Baroda, one of the oldest government-controlled banks, which was increasingly seen as a socialist relic in postreform India. Well-paid, longtime employees were highly resistant to change, and the bank found itself eclipsed by nimbler private-sector competitors. Enter Anil K. Khandelwal, who took over as chief executive in 2005 and immediately created a sense of mission. He met with branch managers, showed them financial analysts’ reports advising investors to avoid the bank’s stock, and then appealed both to their pride (it should be embarrassing to work in an organization of which experts think so little) and to the broader goal of India’s well-being, to which the bank was not contributing enough. To better meet customers’ needs, management decided that the bank must stay open longer. Khandelwal called all the employees of the branches involved in a pilot program to headquarters for a meeting—“from manager to messenger,” as he put it—and asked for their help, letting them determine how to execute the new program. They agreed to staff their branches from 8:00 AM to 8:00 PM without overtime pay and designed their own marketing events to announce the new schedule. Khandelwal wrote letters to the employees every week, explaining goals and describing progress, and often met with them at local branches to make the case for change. The program was a huge success. The bank has since added around-the-clock staffing at several locations. Along the way, Khandelwal introduced such empowering innovations as a direct line to his office for employees seeking his input on problems. Investing in training. Finally, both our qualitative and our quantitative data show that Indian companies invest heavily in employee development—often more so than Western companies. This is partly to ensure that employees have the tools to do their best work, but it’s also designed to strengthen their commitment to the company. When we asked Indian leaders an open-ended question about their human resources development, their responses consistently touched on four themes: managing and developing talent, shaping employee attitudes, managing organizational culture, and internationalization. By far the majority of responses fell into the first category. The most commonly used term in this context was “employee retention,” followed by “recruiting.” These executives, Taking HR Seriously Twice as many Indian leaders as U.S. leaders think that human capital drives business success. Consequently, the HR function in India has high visibility with senior management, and its strategy is closely integrated with the firm’s overall strategy. The HR departments of Indian companies do more measurement than U.S. HR departments on virtually every aspect of their field, while outsourcing basic tasks such as benefits and employee administration. They also have more sophisticated systems—such as workforce planning and succession management— than are common in the United States. Among the Indian firms we studied, 81% of the heads of HR reported that the learning function (training and employee development) was essential to building competitive organizational capabilities, whereas, according to a 2006 survey by the American Society for Training and Development, an astonishing 4% of U.S. chief learning officers held that view of their own operations. March 2010 Harvard Business Review 95 1012 Mar10 Cappelli.indd 95 1/28/10 2:18:16 PM LEADERSHIP LESSONS FROM INDIA Roots of a New Approach The explosion of the Indian economy following the economic reforms of the early 1990s is well known. Liberated from a stifling regulatory environment and exposed to international competition, Indian firms were forced to rapidly develop world-class capabilities. Companies that had built their advantage on low-cost labor abruptly found they had to compete on quality. Although at first Indian companies imported technologies, foreign managers, and global consultants to take advantage of the new opportunities, many learned in time how to do so on their own. “After having been shackled for a couple of decades by overly suppressive and retrograde government policies, our businessmen had their first real shot at competing on the basis of relatively freemarket principles.” Amit Chandra, managing director of Bain Capital Advisors in India by and large, see no trade-off between recruiting and development, and they expect their firms to pay attention to both. U.S. companies have largely abandoned investment in employees, especially in developing managers, for fear that it will be lost if they leave. Statistics suggest that about a quarter of new hires in the United States received no training of any kind in their first two years of employment. In contrast, Indian companies take an aggressive approach to training, despite—or perhaps because of—a competitive labor market in which employee turnover is estimated at How We Did Our Study Our project began with the National Human Resource Development Network, arguably the most influential business group in India. The network helped arrange interviews with the leaders of India’s largest publicly listed companies by market capitalization. We conducted structured interviews with 105 leaders from 98 companies. Relatively few of these companies use the CEO model. At 71 of them the top executive is called the managing director. Leadership is shared at seven of them, so there we interviewed two leaders. We asked what qualities these executives saw as most vital to their success, how they worked with their boards, and where they perceived convergence and divergence with Western prac- tices. We asked how they recruited talent and managed teams, and what legacies they hoped to leave behind. We also gathered survey data from the heads of HR at these companies. We compared the responses with those in a series of surveys of U.S. CEOs and HR executives. The most important data on U.S. CEOs come from a New York Stock Exchange survey, and most of the comparative data on HR practices come from surveys conducted by the Society for Human Resource Management. We supplemented these data with information from previous studies and descriptive information and case studies about the practices in these companies. close to 30%. Skilled workers are in short supply in India; major investment in employee development pays off because it helps ensure the quality of the workforce that remains. Consistent with this starkly different attitude toward training, three times as many Indian as U.S. companies measure and track their skill-development efforts. A recent Kauffman Foundation study indicates that the Indian IT industry provides new hires with about 60 days of formal training. Some companies do even more: Tata Consultancy Services has a seven-month training program for science grads who are being groomed for business consulting roles. In addition, all TCS employees receive 14 days of formal training each year. Even relatively low-skill industries, such as business-process outsourcing and call centers, typically provide 30 days of training, and retail companies require about 20 days. Programs like these are not limited to entry-level workers. India’s second-largest pharmaceutical company, Dr. Reddy’s Laboratories, puts outside hires through a one-year training program that includes 10 weeks of assignments abroad and culminates in a crossfunctional project presented to top executives. Infosys managers are assessed on the basis of how many of their groups’ recent hires achieve an “A” on tests of their new knowledge, how many achieve various competency certifications, and how many outside or lateral hires are rated as “good” in their first review. In addition, senior managers are evaluated on their employees’ job satisfaction and the percentage of leadership positions that have an identified internal successor. Employee investment continues with leadership development; almost twice as many companies in India as in the U.S. formally track leadership training. In Wipro’s sophisticated program, each of roughly 1,000 managers and executives is scored on 12 leadership measures, and individual scores are com- 96 Harvard Business Review March 2010 1012 Mar10 Cappelli.indd 96 1/28/10 2:18:22 PM HBR.ORG “Indian leaders … have been trained or groomed in extremely fluid, dynamic, uncertain environments. [Thus they have] a much greater ability to cope with uncertainty, they don’t get disturbed by uncertain events, they keep an even keel….They also tend to be more creative as a result, because they have to face these sorts of untoward situations almost on a daily basis.” Hindustan Unilever’s former CEO Manvinder Singh Banga pared with company averages. The top 300 leaders are reviewed by Wipro’s chairman, Azim Premji, in a process that extends over five days. Following those reviews, the company draws up a development plan for each candidate that includes coaching, training, and rotational assignments. The process creates a pool of candidates to fill anticipated vacancies. This may sound similar to some U.S. “academy companies,” but Wipro adds other features, such as tracking possible hires outside the firm with an eye to when vacancies at Wipro will create an opportunity to recruit them. MindTree’s cofounder Subroto Bagchi, whose title is vice chairman and gardener, spends much of his time coaching the company’s top 100 leaders. Dr. Reddy’s managers all receive training in coaching and are required to coach as well as evaluate employees. As S. Ramadorai, the former head of Tata Consultancy Services, said of his company’s success, “It’s all about human capital at the end of the day.” Is the India Way Transferable? Just how much leadership practices contribute to the overall success of these large Indian companies is not easy to sort out. Does the focus on employees reflect the limitations of context? In other words, must these firms invest heavily in human capital in order to cope with heavy turnover? Are Indian firms successful not only because their leaders personally drive strategy but because they’re sailing on the Indian economy’s rising tide? Is their emphasis on social mission as important to greasing the wheels as it is to motivating employees? The answer in each case may be yes, in part; nevertheless, these practices confer advantage in and of themselves by enhancing the value of human capital. The Indian leadership approach arose from the unique circumstances of the Indian economy and society (see the sidebar “Roots of a New Approach”), Indian leaders’ approaches often grew out of their long experience with surmounting obstructionist bureaucracies; crumbling, antiquated infrastructure; and inadequate schools, health clinics, and other social services. Growing up in hardship and uncertainty gave many an ability to persistently improvise around obstacles. but unique roots do not mean that lessons cannot translate, as we know from management practices that started in the United States or Japan and have spread globally. The practices that define Indian leadership are not new; individually, they’ve been seen as effective in a range of circumstances. Indian leaders simply combine them in a coherent package and consistently give them high priority. That said, it would be well nigh impossible for U.S. CEOs in particular to announce that shareholder value was no longer a top priority, given expectations in the investment community. And it would be difficult for them to sustain these practices over the long term—to spend time and attention on managing culture and developing employees while the siren call of mergers and acquisitions beckoned or the financial community tempted them with shortterm restructuring deals. But some practices, such as measuring and tracking training and development, are straightforward. Creating a real sense of social mission, whereby employees can feel that their work has impact, is a harder but achievable goal— as is becoming a role model for employees. Western leaders would do well to understand the managerial approaches that have fueled the rise of India’s largest companies, and mindfully adapt them. HBR Reprint R1003G Peter Cappelli (cappelli@wharton.upenn.edu) is the George W. Taylor Professor of Management and the director of the Center for Human Resources at the Wharton School. Harbir Singh (singhh@wharton.upenn.edu) is the William and Phyllis Mack Professor of Management and a codirector of the Mack Center for Technological Innovation at Wharton. Jitendra V. Singh (singhj@wharton.upenn. edu) is the Saul P. Steinberg Professor of Management at Wharton. Michael Useem (useem@wharton.upenn.edu) is the William and Jacalyn Egan Professor of Management and director of the Center for Leadership and Change Management at Wharton. They are the authors of The India Way: How India’s Top Business Leaders Are Revolutionizing Management (Harvard Business Press, 2010), from which this article was developed. March 2010 Harvard Business Review 97 1012 Mar10 Cappelli.indd 97 1/28/10 2:18:28 PM Harvard Business Review Notice of Use Restrictions, May 2009 Harvard Business Review and Harvard Business Publishing Newsletter content on EBSCOhost is licensed for the private individual use of authorized EBSCOhost users. It is not intended for use as assigned course material in academic institutions nor as corporate learning or training materials in businesses. Academic licensees may not use this content in electronic reserves, electronic course packs, persistent linking from syllabi or by any other means of incorporating the content into course resources. Business licensees may not host this content on learning management systems or use persistent linking or other means to incorporate the content into learning management systems. Harvard Business Publishing will be pleased to grant permission to make this content available through such means. For rates and permission, contact permissions@harvardbusiness.org. innovation Nathan Furr Assistant professor of strategy, INSEAD Jeffrey H. Dyer Professor of strategy, Marriott School, Brigham Young University Kyle Nel CEO, Uncommon Partners 112 Harvard Business Review January–February 2019 NASA When Your Moon Shots Don’t Take Off How science fiction and other unconventional tools can fire the imagination and lead to breakthrough growth. innovation R ecently, the head of innovation at a major industrial conglomerate set up 10 cross-functional teams and gave them an audacious goal: to completely reimagine their businesses. To encourage fresh ideas and approaches, the company had the teams apply a design-thinking lens to customer research and prototype solutions using lean start-up techniques. The innovation leader expected 10 transformational proposals to come in. What he got instead were suggestions along the lines of adding a connected data stream to an industrial tool. He was dumbfounded. Where were the radical new concepts? Had no one even considered creating a digital platform, or flipping the business model, or reinventing products? The tendency toward incremental thinking plagues companies of all sorts—in spite of our increasingly sophisticated arsenal of innovation tools. And though incremental innovations do have a place in a growth portfolio, they won’t sustain a business over the long term. How can firms come up with something bigger and more meaningful? What’s constraining creativity? Why can’t every company achieve what Google calls “10x thinking”—ideas that lead to 10-fold improvements rather than the more typical 10% ones? It’s tempting to point to technology, competition, or regulation as the culprit, but those barriers are much more permeable than we imagine. After all, people once thought that a moon landing was impossible, that instant photography was impractical, and that reusable space rockets were simply insane. Then John F. Kennedy inspired a nation, Edwin Land introduced the Polaroid camera, and Elon Musk launched SpaceX. The real limits to 10x ideas are biases that distort our perceptions and prevent us from seeing possibilities. Cognitive 114 Harvard Business Review January–February 2019 science has started to unpack those biases and the ways that we are “predictably irrational,” and in many fields—such as economics, marketing, and strategy—a more behavioral approach has overturned the dominant paradigm. But the behavioral revolution hasn’t taken hold in the domain of innovation, where we’ve yet to systematically adopt the perspectives and tools that help us take big leaps. When considering new avenues to pursue, most of us fall into cognitive traps that reinforce what researchers call local search, such as availability bias, the tendency to substitute available data for representative data; familiarity bias, the tendency to overvalue things we already know; and confirmation bias, the tendency to think new information proves our existing beliefs. As a result we see only the opportunities related to the status quo, rather than more-valuable opportunities just out of view. The purpose of this article is to share some approaches that are helping companies sidestep those traps. They differ from popular frameworks like lean start-up and agile development, which—while valuable—aren’t intended to combat biases that prevent true breakthroughs. In fact, in a recent field experiment at Harvard Business School, researchers found that agile methodologies actually reduced divergent thinking. Ask yourself: Will customer observation, A/B testing, or sprints really lead to the next transistor, iPhone, or SpaceX? Probably not. The tactics and tools we’ll describe all challenge our powerful instinct to avoid risk and choose the easy path. We have either used them to get organizations to see bigger opportunities or come across them in our research on radical innovators. Our list is by no means exhaustive; it represents just some of the ways that creative organizations are reaching for 10x ideas. The intent here is simply to shine a light on how businesses can overcome the forces limiting their possibilities. Science Fiction The late novelist Ursula Le Guin once said she wrote science fiction to dislodge her mind—and her reader’s mind—“from the lazy, timorous habit of thinking that the way we live now is the only way people can live.” Science fiction helps us engage in mental time travel and allows us to dream about what may be possible. Consider some life-changing breakthroughs science fiction has envisioned or inspired: cell phones (which were based on the officers’ communicators in Star Trek), credit cards (a feature of a futuristic society in a 19th-century novel by Edward Bellamy), robots (conceived in one of Karel Čapek’s early-20th-century plays), self-driving cars (foreseen by Isaac Asimov), earbuds (a fictional invention of Ray Bradbury), and atomic power (imagined by H.G. Wells in 1914). Phil Libin, the former CEO of Evernote—who says the concept for that note-taking software came directly from augmented intelligence in the novel Dune—puts it this way: “Science fiction can provide a kind of rigorous optimism.…There’s no magic. Science fiction just provides the inspiration and then you make a rigorous plan and go for it.” In our consulting work, we have seen science fiction help large, established companies visualize a new future for their businesses. Indeed, at Lowe’s, where Kyle was head of innovation, this approach got the executive team members to understand how they could revolutionize retail with augmented reality, robotics, and other technologies. And that was back in 2012, before Oculus Rift or Pokémon Go even existed. The process simply involved giving customer and technology data to a panel of science fiction writers and asking them to imagine what Lowe’s might look like in five to 10 years. We then gathered their ideas, noted where their perspectives converged and diverged, and integrated and refined the stories. Finally, we shared our “speculative fiction” in comic book form with the Lowe’s executives. As a result of that project, Lowe’s became the first retailer to deploy fully autonomous robots for customer service and inventory, created some of the first 3-D printing services, and helped place a 3-D printer for making tools on the International Space Station. It also created exosuits (external robotic skeletons) for employees unloading trucks and moving goods Idea in Brief THE PROBLEM Incremental thinking plagues organizations that are really looking for breakthrough innovation. onto the store floor, and came up with the first augmented-­ reality phone for planning remodeling work (which initially sold out in four days). Not only has Lowe’s achieved financial success (3-D imaging capabilities have boosted its online sales by up to 50%), but in 2018 it was named number one in retail innovation in Fortune’s Most Admired Companies ranking and number one in augmented reality on Fast Company’s Most Innovative Companies list. Although technology features heavily in the Lowe’s example, innovation isn’t about technology. We have used the same process even when no technology was involved— for example, to help Pepsi imagine how to create healthful products and Funko to envision how to expand beyond the collectibles business. Analogies One evening, as the Nobel Prize–winning physicist Werner Heisenberg was walking through a park in Copenhagen, a fundamental insight about the nature of energy dawned on him. The path he was on was very dark, save only for occasional circles of light cast by the street lamps. Ahead of him, a man appeared in a pool of light under one lamp and then disappeared into the night until he reemerged in the next pool. Suddenly, it came to Heisenberg: If a man, with so much mass, could seem to disappear and reappear, could an electron, with almost no mass at all, similarly “disappear” until it interacted with something else? According to the author and physicist Carlo Rovelli, that insight into how packets of energy interact— which later became Heisenberg’s famous “uncertainty principle”—struck him because he applied an analogy, comparing the man walking between lampposts to an electron. Analogies have led to breakthroughs in business as well (as Giovanni Gavetti and Jan Rivkin noted in a 2005 HBR THE REASON Cognitive biases too easily distort our perceptions and prevent us from seeing possibilities. A SOLUTION An assortment of tactics and tools can challenge our powerful instinct to avoid risk and choose the easy path. Harvard Business Review January–February 2019 115 innovation article, “How Strategists Really Think: Tapping the Power of Analogy”). Charlie Merrill revolutionized the brokerage industry by applying the analogy of a supermarket, which lets shoppers choose among a host of products and brands. Circuit City, which introduced the superstore approach to electronics retailing in the 1970s, transformed the automotive industry by applying a similar logic (wide selection, low fixed prices with no haggling) to used-car sales, creating CarMax. Though Circuit City went bankrupt after the shift to online retailing, CarMax is now the largest used-car retailer in the world. Analogies from different domains can sometimes help us make big leaps. The rapid growth of Uber and Airbnb, for example, certainly foreshadowed the emergence of similar “sharing economy” businesses, from recreational vehicles (RVshare.com), to storage (Neighbor), to grocery delivery (Instacart). Another way to jog your thinking is to use an analogy involving how not to do something: How would Google never do it? You can also draw on lessons from failures: What approach did a company that missed the mark try? First Principles Logic Regeneron Pharmaceuticals is renowned for developing new treatments at a small fraction of its competitors’ costs. At the core of its innovation process is a “first principles” approach, which questions the status quo by reexamining the foundational principles about something and then redesigns it from the ground up. “We challenge everything—every concept, every scientific principle—and we argue about it amongst ourselves,” says George Yancopoulos, Regeneron’s president and chief science officer. For example, the firm questioned the dominant paradigm for testing new treatments—trying them first on mice and then on humans, which often leads to high failure rates because mice and people are so different. Yancopoulos and his team sought to reinvent the process by developing a mouse implanted with human genes to more closely simulate human reactions. The modified mouse has enabled Regeneron to develop new drugs for less than 20% of the average $4.3 billion cost of developing new therapies. SpaceX’s reusable rocket emerged from a similar first principles approach. Founder Elon Musk wanted to buy 116 Harvard Business Review January–February 2019 castoff rockets from the Russians but was rebuffed. As Ashlee Vance recounts in Elon Musk: Tesla, SpaceX, and the Quest for a Fantastic Future, Musk was furiously crunching numbers in a spreadsheet on a flight back from Russia when he turned to Mike Griffin, a future NASA administrator, and Jim Cantrell, a founding executive at SpaceX, and said, “I think we can build this rocket ourselves.” Cantrell recalls, “We’re thinking, ‘Yeah, you and whose army?’” But after reading up on the fundamentals of propulsion, aerodynamics, thermodynamics, and gas turbines, Musk had broken rockets down to their basic principles in his spreadsheet. With that analysis, his team came up with a way to develop affordable, reusable rockets by using simpler commercial-grade, rather than space-grade, components in a smaller architecture. Today SpaceX has performed more than 60 successful flights and 29 successful landings and saved NASA, its major customer, hundreds of millions of dollars. “In most cases people solve problems by copying what other people do with slight variations,” Musk told us. “I operate on the physics approach of analysis by first principles, where you boil things down to the most fundamental truths in a particular area and then you reason up from there.” Exploring Adjacencies Using Exaptation As you search for breakthroughs, the set of available opportunities is always determined by the elements you begin with— a concept that the biologist Stuart Kauffman described in his theory of “the adjacent possible.” But we tend to see only the uses or recombinations of those components that are obvious. The key is to discover completely different uses. In evolutionary biology, this happens in a process called exaptation—in which a characteristic that evolved for one purpose is adapted laterally for another use entirely. For example, feathers, whose initial function may have been to provide warmth or attract mates, became the key to flight. Similarly, the complex jawbones of early fish evolved as those creatures became land dwellers, developing into ears. If exaptation works in the biological world without any human agency, then in a world of choice and imagination, its possibilities are infinite. How can would-be innovators tap the power of exaptation? They can begin by asking why we use something for one purpose and not another. For example, after Van Phillips lost his leg in a waterskiing accident, he studied biomedical engineering to learn how to design prosthetics. He was surprised to discover that prosthetic design had changed little since World War II. When he explored why, he learned that designers focused on aesthetics—making the prosthesis look like a foot. But Phillips asked, Why does it have to look like a foot? What if instead it acted like a foot? Drawing ideas from pole vaulting, diving boards, and the feet of cheetahs, he created the Flex-Foot, a prosthetic that looks nothing like a foot but gives wearers far greater freedom of movement. (Most Paralympians use versions of it.) By reexamining the purpose of artificial limbs, Phillips revolutionized the field of prosthetics. Jeff Bezos applies a similar kind of thinking at Amazon, where he encourages teams to look broadly for new uses of their existing capabilities or new ways to solve the problems of existing customers. “If you’re talking about how do you decide what adjacencies to move into, we do it two ways,” he says. “We do it customer-needs-backwards, and we do it skills-forward.” Amazon Web Services (AWS), one of the company’s most profitable businesses, emerged from the skills-forward method. “With AWS we had to recruit a new set of customers, but we had extraordinary skills inside the company on distributed computing,” says Bezos. The Kindle was the product of the other method. “With Kindle we had no hardware experience, so we didn’t have the skills,” says Bezos. “But we had a customer need.” the point of these four innovation approaches is to shake up our thinking and get us past our natural inclination to stick with what we know—to sidestep our cognitive biases. There are certainly other techniques. Amazon, for instance, asks employees to write press releases that introduce an imaginary new product to the market; this encourages them to envision what new offerings could be in a few years. That tactic can even help you with your career. In the month of January, you can write Christmas cards describing what you’ll have accomplished by December. There are also tools to help you make progress. For example, you can create an “artifact trail”—a set of small wins leading up to your vision, which you can begin acting on immediately—or apply experimental design processes to see whether you’re heading in the right direction. Whatever frameworks or approaches you use, the goal is to focus on what could be. Too often would-be innovators get bogged down in details of what happens to exist today and tone down ideas to make them sound more palatable. But to achieve 10x thinking we have to break free of incrementalism and face down the fear of failure. You need to dream big. Consider Einstein. While racing against David Hilbert, a brilliant mathematician, to articulate a general theory of relativity, Einstein struggled to frame up the specific mathematics to describe his theory. He presented his thinking every week, and every week the calculations were different. As Carlo Rovelli recounts it, Hilbert was struck by Einstein’s difficulties with the details, noting: “Every boy on the streets of Göttingen understands more about four-dimensional geometry than Einstein.” Yet, as Hilbert himself pointed out, Einstein solved the problem first. Why? In Rovelli’s opinion: “Because Einstein had a unique capacity to imagine how the world might be constructed, to ‘see’ it in his mind.” We don’t claim to have identified all the ways to generate 10x insights. But we do believe that firms need new approaches to reach such discoveries more effectively, and we’ve described several of them here. We also believe it’s time for a behavioral revolution in the field of innovation. By taking the cognitive sciences seriously, we can become better at breaking the bonds that limit our vision. Why is that so important? Because there is no objective future out there that we will arrive at one day. There is only the future that HBR Reprint R1901H we create.  NATHAN FURR is an assistant professor of strategy at INSEAD. JEFFREY H. DYER is the Horace Beesley Professor of Strategy at Brigham Young University’s Marriott School. KYLE NEL is the CEO and cofounder of Uncommon Partners, a behavioral transformation consultancy, and the former executive director of Lowe’s Innovation Labs. Furr and Nel are the coauthors (with Thomas Zoëga Ramsøy) of Leading Transformation: How to Take Charge of Your Company’s Future (Harvard Business Review Press, 2018). Harvard Business Review January–February 2019 117 Harvard Business Review Notice of Use Restrictions, May 2009 Harvard Business Review and Harvard Business Publishing Newsletter content on EBSCOhost is licensed for the private individual use of authorized EBSCOhost users. It is not intended for use as assigned course material in academic institutions nor as corporate learning or training materials in businesses. Academic licensees may not use this content in electronic reserves, electronic course packs, persistent linking from syllabi or by any other means of incorporating the content into course resources. Business licensees may not host this content on learning management systems or use persistent linking or other means to incorporate the content into learning management systems. Harvard Business Publishing will be pleased to grant permission to make this content available through such means. For rates and permission, contact permissions@harvardbusiness.org. cRUCIBLE 118 Lessons learned from a hospital bed CASE STUDY 121 The good and the evil of an angel investor SYNTHESIS 126 Three ways to explore globalization LIFE’S WORK 132 Norman Foster on effective office architecture Experience MANAGING YOURSELF Zoom In, Zoom Out The best leaders know when to focus in and when to pull back. by Rosabeth Moss Kanter A fter an explosion on a BP oil platform in the Gulf of Mexico in April 2010 killed 11 people and caused the biggest oil spill in U.S. history, the company’s CEO at the time, Tony Hayward, zoomed in on the implications for his career. He appeared preoccupied with the incident’s impact on BP’s management and, particularly, on himself. About a week after the explosion, Hayward was quoted as saying to executives in his London office, “What the hell did we do to deserve this?” Despite PR coaching, a month later he told reporters, “I’d like my life back.” 112 Harvard Business Review March 2011 Hayward, who was forced to resign in July, had numerous opportunities to acknowledge the bigger picture: the human devastation and public consternation in the Gulf region. But even though BP deployed thousands of engineers to contain the spill, he could not, in public, rise above a 10-foot view; it was as though the crisis were his own personal devil. Hayward repeatedly focused on the small picture—trying, for example, to shift the blame to supplier Transocean, which had run the rig that exploded. His zoom button seemed to be stuck on the closest setting. The lens through which leaders view the world can help or hinder their ability to make good strategic decisions, especially during crises. Zoom in, and get a close look at select details—perhaps too close to make sense of them. Zoom out, and see the big picture—but perhaps miss some subtleties and nuances. Zoom buttons on digital devices let us examine images from many viewpoints. They also provide an apt metaphor for modes of strategic thinking. Some people prefer to see things up close, others from afar. Both perspectives—worm’s-eye and bird’s-eye—have virtues and pathologies. But they should be vantage points, not fixed positions. Leaders need multiple perspectives to get a complete picture. Effective leaders zoom in and zoom out. I’ve come to this conclusion after more than 25 years of observing how leaders set strategic direction, interact with constituencies, and respond to unexpected events. I’ve worked with thousands of executives and conducted systematic studies of innovation, alliances, change, and transformation in hundreds of organizations. I’ve seen how organizational structures, processes, and cultures can direct the gaze of leaders close in or far out, and how levels of analysis can become default positions that limit effectiveness. The zoom framework offers a dynamic model that can help current and aspiring leaders increase their own range of vision and establish conditions that enable others’ success. In this article, I will identify the behavior and decision modes associated with zooming in and contrast them Illustration: Grady McFerrin Managing Your Professional Growth hbr.org hbr.org with those for zooming out. I’ll consider the structures and cultures that trap people in dysfunctional default positions, and I’ll conclude with ideas on developing capabilities for zooming to all levels. Zooming In Zooming in brings the details into sharp focus. Any opportunities look large and compelling, though they may lack some context. A CEO I will call “John Jones”—who owns a midsize retail chain started by his father—works primarily in close-in mode. A classic entrepreneur who combines hustle with retail-is-detail know-how, Jones expanded the chain successfully from two to 30 locations by continually seeking the next prime site, merchandise item, or website tip. His discoveries came mostly through his personal connections rather than analysis. Jones disdained strategic plans and management theories. He removed a well-regarded banker from his advisory board, for instance, because the banker would ask for plans— orderly goals, with timelines—when Jones simply wanted to concentrate on specific operational ideas that were easy to implement. Thanks to his industry knowledge, wide personal network, and intuition, zooming in served Jones well for a decade. But when the economy soured, his good instincts felt insufficient. Family members and key employees began to question his decisions. Jones had no succession plan—nobody had been groomed for the future. He made acquisitions on the basis of his own taste or just because an owner wanted to sell, and gave little thought to cost, whether the acquisition was a good fit, or what else was on the horizon. He had no broad theory about which opportunities to pursue and no industry map. Zooming in was limiting his company’s growth prospects. Close-in managers look for immediate benefits and make ad hoc decisions. They often favor one-on-one conversations over group meetings. They want to address Are You Stuck in A Perspective That’s Too Close In? Telltale signs Questions that will help you zoom out You get overWhat is the conwhelmed by count- text? What matters less details most? You take things per- What larger sonally, finding the purpose is being “me” angle first served? What is at stake for others? You trade favors, hoping others will “do it for me” Why is the task or mission worthy of support? You make exceptions or special deals based on particular circumstances Will the circumstances recur? What policies or decision frameworks could be used? You jump on any good-looking offer that pops up Does this fit the goal or destination? What else might be on the horizon? You treat every situation as unique Are there other similar situations? What categories or groupings make sense? details by doing whatever occurs to them. Faced with a problem, they look for quick fixes rather than stand back to seek underlying causes, alternatives, or long-term solutions. They prefer to contact someone they know rather than search more widely for expertise. These tendencies are exacerbated in organizations that restrict information flow, reward quick hits, and confine people to their roles. A close-in perspective is often found in relationship-intensive settings, where human talent is the primary asset. Consider another executive, whom I’ll call “Sam Lee.” He ran a well-regarded professional services firm during a decade of incremental growth. Known as a benign leader, Lee could talk about strategies with external constituents, but he operated best when zooming in. He liked to confer in a clublike huddle in his office rather than discuss issues in open meetings. He was unfailingly helpful with individual requests (including one-off favors). In other words, he liked to make exceptions instead of policies. As a result, his organization had an abundance of private deals with individual staff members (such as off-calendar budget allocations, vacation privileges, sabbaticals, and extended family leaves). In a time of prosperity with few external threats, a personal approach may be acceptable. Toward the end of Lee’s tenure, however, the firm found itself in an increasingly competitive environment with greater regulatory pressure. It was becoming untenable to treat each situation as unique. Even as policy exceptions accumulated, the logic behind these decisions remained unaddressed. Junior professionals were left to wonder and worry about the rules and fairness. Whispered concerns about favoritism ran through the corridors. The organization was running on a patronage system of personal credits and debits, with a market for favors substituting for principle-based decision making. Morale and productivity declined, jeopardizing the company’s reputation and making it harder to attract the best talent. When Lee March 2011 Harvard Business Review 113 Experience retired, his successor immediately zoomed out, stating a few broad strategic priorities. He created clear formal policies to replace informal exceptions and began discussing them all openly in large meetings. One of the traps of zooming in is that policies and systems are based on internal politics. Close-in people tend to talk about their personal lives, as though self-disclosure will beget the same from others, turning organizational actions into an exchange of favors based on special relationships. They often resist change because it disrupts the social equilibrium. Sometimes their personal approach is valuable, because people respond faster to individuals they know than to abstract appeals. But “do it for me” is a weak basis for corporate decisions. It also means that employees cannot easily stand in for one another, because relationships are “owned” by specific people. And it can put ego above institution. Relying heavily on personal instinct and interpersonal deals without a wider perspective or a long-term rationale can prove perilous. An overly personal approach can also make managers quick to perceive slights, whether or not they’re real. The CEO of one technology company, though known as a great strategist, still let zooming in drive some decisions. He was personally offended by how a prominent magazine had portrayed him, so the company stopped advertising there. Employees took this as a warning to tread carefully when providing him with unfavorable information. In another case, a corporate middle manager pored over e-mails to see whether he was being treated appropriately, and complained immediately if he perceived any suggestion of offense. His focus on status over substance cost him a higher-paying position; the plum promotion went instead to a manager with a grasp of the bigger picture. Zooming in can obscure the big picture, leading managers to overlook important issues. Decisions become based on who you are and whom you know, not on broader goals. 114 Harvard Business Review March 2011 Zooming in can also lead to turf protection. When managers use territorial language, it reveals that they have fallen into this trap. One division CFO, for instance, always used the first person when referring to budget numbers, as in “I have x dollars,” even though it was the organization’s money, and ignored repeated requests from other members of the executive group to stop this manner of speaking. Personalizing is not the same thing as self-reflection—indeed, it might be the opposite. Self-reflection is a learning process that requires a distant perspective on one’s own behavior, in context. An ob­ session with self is reinforced by zooming in, but self-awareness stems from zooming out. Zooming Out Zooming out is essential to big-picture decision making. When people are far out, they can map the whole territory before taking action. They see events as examples of general patterns rather than as idiosyncratic or personal incidents. They put things in context and stress principles. The former CEO of Garanti Bank, Akin Ongor, led it from a middle-of-the-road bank in Turkey to global prominence by setting up processes that replaced poor performers and upgraded talent. When his announcement of layoffs provoked union protests and even death threats, Ongor refused to take the attacks personally or get drawn into ad hominem battles. Instead, he went to the media and elevated the discussion to the principles behind the bank’s actions. By zooming out, he helped his employees, the public, and government officials see the layoffs in the context of a transition in the economy and as a move that would save an important institution so that it could create more jobs in the future. The protests ended, and Ongor continued to lead successful change at the bank. Zooming out helps people see the map and stay focused on larger principles. Consider Procter & Gamble CEO Robert McDonald, who rose through the ranks to head a global public company with a long-established culture. Even while seeking current profits, he constantly asks questions about what will support the sustainability of the company and keep its values intact. He can generalize about geographies and lines of business while appreciating cultural differences. He is personable but doesn’t personalize issues, repeating often that he is a steward of an institution that must endure beyond him. Zooming out helps people see the map and stay focused on larger principles. But it also has traps. Zooming out is appropriate for top leaders. But it also has traps. For one thing, key stakeholders might want to see immediate results and know that the details are right before they support long-term big-picture thinking. That’s why broad visions need to be matched by small wins that demonstrate feasibility. For another, leaders who like to be far out may operate so high above the fray that they don’t see emerging threats and opportunities (which, ironically, is a danger for closein leaders too) or recognize competing theories that are better...
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Running head: STRATEGIC THINKING, DECISION MAKING, AND INNOVATION

Strategic Thinking, Decision Making, and Innovation

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STRATEGIC THINKING, DECISION MAKING, AND INNOVATION

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Introduction
Setting strategies has become more important in today’s society than in the past times. The
setting of strategies, therefore, has been setting more challenges and setup of today’s businesses
because the rate of competition has been rising at an increasing rate. Therefore, the businesses
owners and even the sole proprietors are expected to make smart plans regarding the type of
business that they own (Vermeulen, & Sivanathan, 2017). The strategies that the businesses should
set to govern their operations should sufficiently include the elements of innovation and decision
making. Every business entity tries to be at a position of satisfying all the demands of the customers
in the market and hence the need to have reliab...

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