“Change Who Recruits, Don’t Ban Resumes”

On February 21st, Lou Adler posted the following on Linked In. It generated a lot of interest, including my own comment at the end of this blog.

“On why we should ban resumes!”

see http://www.linkedin.com/today/post/article/20130221192310-15454-why-we-should-ban-resumes?trk=eml-mktg-condig-0108-p1

The idea of matching someone’s skills and experience on a resume to a job description consisting of an arbitrary list of skills and experiences seems rather archaic to me. Some people actually defend doing this faster as a major advance in modern HR practices.

In a recent post, I suggested that a better first step was a candidate being referred to a recruiter or hiring manager by someone already in the company, a vendor, a customer, or someone who can personally vouch for the job-seeker based on the person’s past performance. This is equivalent to using the company employee referral program to proactively seek out more top performers. Most companies recognize this as one of their best sources for new talent and the primary reason why referral programs are being expanded using tools like LinkedIn. Promoting people through internal mobility is also based on the tried and true concept that performance is more important than experience.

In my new book, I suggest that the process used for internal promotions represents a good model for finding and hiring people from the outside. Adopting this approach involves eliminating traditional skills-infested job descriptions, replacing them with performance profiles, and reconfiguring the box-checking first step.
Due to the “radical” nature of this proposal I asked David Goldstein a senior attorney with Littler Mendelson, a highly respected U.S. labor law firm, for his legal perspective. His white paper is now available. Here’s his opening statement:

Because the Performance-based Hiring system does differ from traditional recruiting and hiring processes, questions arise as to whether employers can adopt Performance-based Hiring and still comply with the complex array of statutes, regulations, and common law principals that regulate the workplace. The answer is yes.

In particular:
A properly prepared performance profile can identify and document the essential functions of a job better than traditional position descriptions, facilitating the reasonable accommodation of disabilities and making it easier to comply with the Americans with Disabilities Act and similar laws.

In the book, I also suggested that the standard “submit resume and box-check skills” approach should be replaced by an initial matching process that didn’t inadvertently eliminate fully-qualified people. One idea was to have candidates submit a one-page summary of two accomplishments most comparable to the real requirements of the job. Since the job postings I recommend minimize skills and emphasize opportunities and challenges (sample), this is pretty straight-forward. For example, if you’re hiring a maintenance supervisor to minimize machine downtime and upgrade the team, ask all applicants to describe something they’ve done in each area as the first step. This will minimize the pool of unqualified people from applying and broaden the pool of the most qualified who might have a different mix of skills and experiences. David gave a legal thumbs-up to both the creative advertising idea and the alternate approach for applying.
Coincidently, in the past few days two different starts-up companies approached me to consider being on their advisory boards. Both had far different and unique ideas on how to broaden the pool of potential candidates by breaking the same nonsensical skills-matching process described here. The common idea: the best people aren’t interested in lateral transfers, the best people often have a different skill-set, and these same people aren’t interested in enduring the insensitive application process. Excluding the most talented people from consideration when hiring from the outside never made sense me. It’s exciting to see some technical advances being proposed to now do this at scale.

If you follow my posts, you know I’m on a quest to change the focus on finding and hiring people to one based on their actual performance – they’re ability to deliver comparable results. It’s what people have accomplished with their skills and experiences that matters, not their accumulation. This opens up the door to a whole new pool of more diverse, younger, older, military veterans, displaced workers and the physically challenged. We don’t have as big a skills gap as the national media contends, we have a bigger thinking gap.
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Lou Adler (@LouA) is the Amazon best-selling author of Hire With Your Head (Wiley, 2007) and the award-winning Nightingale-Conant audio program, Talent Rules! His latest book, The Essential Guide for Hiring & Getting Hired, is now available as an Amazon Kindle eBook.

 

My Response:

Change Who Recruits, Don’t Ban Resumes

Well, how intriguing, I am about to both somewhat agree and profoundly disagree with Lou Adler, a man whose writings I deeply respect.

I think that he probably used the word ban to provoke dialogue. He certainly succeeded – 411 comments at my last count. A quick scan of the comments – they seem to break into two camps – folks who agree and folks who don’t. But both groups seems to me to miss one of the key points.

Resumes are tools. Tools serve a purpose. But if you have only one tool in your took kit, then you then to see everything in terms of that tool. I don’t. I use a bunch of tools as a recruiter.. A resume is just one.

When I use a resume, I treat as a tool to make a crucial decision – will I choose to invest more time in getting to know this person well enough to make sound decisions about their status as a potential candidate. How I use the resume is all about me and my decision making process, not about the quality of the match between the candidate and the job.

I can make a first scan “no –I will not invest more time in this person – decision” in about 10 seconds. I have probably read 10,000 plus resumes during my career as a recruiter and as a hiring manager. Of these two, reading them as a hiring manager is of far more importance. A people manager, I have had to deal with the consequences of the hiring decisions that I made (hundreds plus) – including the bad hires that I made. Doing performance reviews at 3 months and 12 months point has shown me that I made more than 1 bad hire decision over the years – maybe about 10% of my total hires were “not the best” looking back. A few were outright disasters, for me, the person that I hired, and the organization for which I was working. That means that I read resumes with a very different set of eyes that 95% of the professional recruiters with whom I have, and do, work.

Here are some thoughts about how I use a resume as a tool in my recruiting – hiring decision making process.

1. If we could count on resumes as being written by the people whom they profile – i.e. as personal expressions – they would be a kind of performance piece. I still read them this way – how well does this person do at the job of presenting oneself in a world where it is tough to use this limited tool to stand out – to differentiate yourself?

Unfortunately, in the last 5 years, more and more (almost all now) of the resumes that I read are written by “resume writing professionals” or based on a “format” that is available in a book. I always ask the folks I invest more time in “Did you write this? Did you follow a format that something else recommended?” The answer is almost always yes. Given this fact, in my opinion, resume still work as a “first scan tool”, but that is about all.

2. Everyone practices resume inflation. A resume is a marketing document. You write it (or have it written) to make yourself look good. I read them now (in about 30 seconds) to answer ONLY three initial questions for myself.

• Has this person invested enough time into this resume (or cover letter) to indicate that the individual is motivated to want this job – to adapt the first way they present themselves to me in a way that reflects what I have communicated about the job, or is this a “one size fits all piece”?

• Are there enough facts in this resume here that indicate that this person has a hope of having some past experience that indicates that they either have relevant skills or RELEVANT POTENTIAL to be a person I want to invest more time in getting to know on this recruitment?

• If I should decide to invest more time in this person as a possible candidate, what “past accomplishment or performance” looks likely to be a good one that I could use to explore in depth through dialogue with the person to get a better sense of who this person was when she or her was doing this accomplishment?

That is what I use a resume for. I don’t use “key word matching” algorithms. The information they generate is about words on paper, not about people who can potentially do a job.

I don’t make hiring / candidate recommendation decisions on the basis of resumes. I make “explore deeper decisions”. I believe that resumes, even given the way they are generated today still serve a “good enough purpose” to do that, provided the recruiter AND hiring decision maker also has some or all the tools that Lou recommends in his performance based hiring writings (or similar tools) in his or her tool kit.

If I were to make one change in the recruiting process (and I do so in my own firm), it would have to do with recruiters, not resumes. I would never assign a person to a recruiting role until they have had experience with managing people on-the-job, high performers, average performers and poor performers.

You can teach people recruiting techniques, including skills which help them understand the performance requirements of the job, and deep interview skills in a reasonable period of time. But you can’t generate the mature people judgment capability you need in a high quality recruiter in a reasonable period. You can only search for, select and deploy it. I believe that this will make far more difference to the quality of recruiting that banning resumes.

Are Older Workers Marginalized in the Workplace?

Lorrie Clark of the Permanent Search Group in Toronto, Ontario, Canada started a dialogue in the Canada Jobs, Careers and Networking, a subgroup of Job Openings, Job Leads and Job Connections!  group on Linked In.

Are Older Workers Marginalized in the Workplace?

Do you think that aging workers become less valued and even marginalized in the workplace as they grow older?

The thoughtful comments there got me thinking. Here is my point of view of the underlying dynamics leading to this.

Funny how things changes as the years accumulate. When I was in my 20′s, 30′s, 40′s, and 50′s, I never really thought about hiring folks who were older. I just hired the folks that fit the jobs I needed filled – and generally age reflected required experience.

As I gained experience, and moved into more senior positions, I tended to hire folks who were the same age or folks who were younger than I was.

Because I moved into senior ranks (CIO level) in my early thirties, I also often hired folks who were older than me – but even then I realized that this was not the usual pattern in the companies in which I worked. People tend to hire folks who are the same age or younger. Most folks are just not comfortable hiring folks who are the same age as their parents.

Then I entered my late 50′s and 60′s. Suddenly, head hunter acquaintances were politely telling me that I was a “hard sell”. The socially polite ones used the words “too experienced”. But a few of them were a little more straight  with me. Here is the kind of thing I heard from them.

“Can’t place folks pass 55 in most of my assignments – people want the appearance of youthful energy – even when it is an illusion. The other reality is that folks don’t tend to hire people that are older than they are. It’s is the exception, rather than the rule. Most of my clients – the folks who make the hiring decisions – are in their late 40s, early 50′s and they hire folks who are younger than they are.”

So I believe that things have not changed all that much in the past 50 years or so on the hiring side.

But things have sure changed on the demographic side, and on the economic side. There are more folks who are healthy and wanting to do productive work who are in their late 50′s, 60′s and 70′s than ever before. And there is a talent crisis coming, as well as continuing economic turbulence. This in and off itself is not enough to produce real change in the hiring marketplace. Things won’t change however till companies, and even more importantly, politicians, do three things.

1. Companies need to stop expecting HR recruiters in their 30′s and 40′s to present candidates who are older than the HR recruiters to hiring managers. Put some recruiters in their late 50′s and 60′s into the recruiting department if you want to see that change.

2. Companies need to stop the hiring myth that we as a company are hiring you for the rest of your career. The employment marketplace and social stats are clear. People will work for a number of companies and have a number of careers in the 21st century. Problem is most companies’ pension plans, even if they have made the move from defined benefit to pay out what your plan is worth, are still structured on the 20th century expectation that you will work  for this company for most of your career.

Cut pensions loose from companies, make them portable, belonging to the individual. Let’s see serious tax and legal frameworks that encourage companies to do that. Politicians take note please.

3. Create a job market place which encourages and supports “interim” or contract assignments which are strongly differentiated from full time or career assignments.

Again this will not happen until appropriate legal and tax framework changes are in place. For one thing, individuals working in this “contract” marketplace need things like income averaging to help manage the risks involved. They also need a simpler “business expense” framework than the one which works for companies / corporations.

But, personal opinion – given the mess that politicians have gotten into by running up big deficits – we are not likely to see this kind of forward thinking from most of them. On my more morbid days, I sometimes think that democracy is a con game in which politicians buy votes with a voter’s neighbor’s (who can vote) and voters’ kids (because government deficit financing of current programs ==> future taxation of people who cannot vote) dollars.

Systematic Consensus – It is Great but It is Not New

In the February 2012 issue of the Internet-based Eco-villages newsletter, Diana Leafe Christian, the editor, published a piece called “Systemic Consensus – Fast, Visual and Hard to Deal With”.  In it, she described the development of an extension of consensus decision-making called Systematic Consensus. Diana  praised many of its features, based on real experience that she has had with it.

Systematic Consensus has two main features. First, it allows participants in a decision-making group to express their degree of support for the options being considered. They use a scale – typically a scale running from 0 to 10 – 0 meaning no support, 10 indicating full support. They indicate their degree of support for each option on this shared scale. As a result, individuals can move beyond simple binary decision making – support or do not support. They can express nuances – degrees of support – that are far more thoughtful, and revealing, than simple binary choices.

Systematic Consensus’s second main feature is the collation and public posting of each individual’s level of support for each option on a group flip chart, poster or white board. The facilitator leads this process. As she or he does so, dynamically, in front of the group, the facilitator is creating a real time group profile that displays the range of support for the various options under consideration. As a result, the dialogue in the group is enhanced, leading to more productive outcomes.

Dinah goes on to explain how all of this works. She provides some concrete examples drawn from real involvement with a number of community groups. She demonstrates that is not simply a mechanical process, but one that requires real process leadership skill on the part of the facilitator.  It’s a fascinating article. I recommend that you have a look at it. It’s available at the following URL –
http://www.ecovillagenewsletter.org/wiki/index.php/Systemic_Consensus_%E2%80%94_Fast,_Visual,_and_Hard_to_Argue_With
.

As I read it, I was reminded of the power of, and difficulty inherent in, facilitating productive consensus in groups. I remembered some of the difficulties that I had experienced when facilitating a group dedicated to achieve consensus early in my facilitator life. I learned through hard experience that great consensus building sessions make deep contributions to building a highly functioning team or a strong sense of community among individuals. But I also learned that skillful individuals can block or sabotage consensus in groups, bending other members to their own point of view through sheer self-centered determination. Achieving productive consensus is not always easy.

The two core concepts that underlie systematic consensus are important ones. They address some of the problems that can occur in consensus seeking groups. But these ideas are not new. They are a great contribution to the dialogue about the dynamics needed to build intentional communities. I have been working with very similar processes for years when facilitating problem solving groups in  more conventional environments, both community and business. Some I developed myself. Others entered my facilitation took kit as a result of mentoring and coaching from facilitators who has struggled with the difficulties inherent in facilitating consensus long before I start to do so.

I hope that you will go take a look at Diana’s article. It provides background for following insights about facilitating group decision making and consensus.

Building Dynamic Group Profiles in Real Time

I have been using the visual charting technique in working with groups for several decades.  Hedley Dimock[1], one time Director of the Centre For Human Relations and Community Studies, first introduced me to the idea of visually developing group profiles in front of a group.  Since those days, I have learned that there are a couple of critical things to do when a facilitator chooses to use this technique.

1. First, I get individuals to make a personal decision about where they stand on the issue or the options under consideration. I direct them to move into a “personal” space while they are doing so. As a result, they experience a physical separation between the space they are working in as a group and the place in which they make these personal decisions. This physical separation aligns with the cognitive distance that I want them to experience.

Often this is as simple as getting them to move around the room in some way that results in them being in different physical location from where they would be when the group is in its normal “working in group” configuration.

1. I ask them to record their decision in some way, often by requesting that they do something as simple as writing down their stand on each option – e.g. simply recording the relevant number of the scale if we are using one. I always ask them to label this recording with their name. If multiple options are on the table, they record where they stand on each one in a way that clearly identifies each of the options.

I have found that this “personal recording step” is crucial in avoiding “group think”. Without it, people often change their “judgments on the fly” as they see the pattern of individual results being recorded on the publicly visual group profile. For some people, “belonging” is far more important than taking a personal stand. They “conform” to group patterns, even though the group pressure they are feeling is implicit and indirect..

By asking group members to make these judgments personally, and recording them, I decrease the likelihood of such a “spontaneous” personal change in judgment. When I am really concerned about this dynamics happening in a particular group, I will even “collect” the individuals’ judgments before starting to build the group profile with the whole group. I do so by simply asking people to give me a copy of what they have recorded. I then ask them to refer to their copy as I record their personal results on the group profile. If individuals do verbally provide a different input on an item from what is recorded on their / my copy, I record what they say. I take these steps in order to decrease the likelihood of this happening, not force it not to happen.

1. Although I may create a version group profile for my own insight[2] before I facilitate the “profiling” group session, I always build a group profile dynamically in real time with the group. By collecting, collating and recording the individual judgments in real time, in front of the entire group, I achieve the following.

• Each individual verbally expresses their personal decision in front of the other members of the group. Every group member experiences each person doing so. This creates an implicit sense of each person “owning” their judgments within the dynamic context of the whole group.

 

• Each member of the group sees the group profile being built. They can see the evolving patterns in the group profile. They can see where they are personally with reference to each of the other members of the group.

I am well aware that implicit “sub-grouping” around similarities can start to occur at this stage. But they do anyway in normal group discussion.

Underlying Psychological Dynamics

Recording individual judgments in a way that creates a publicly available group profile has many benefits for team and group development. It takes advantage of a number of well-known psychological dynamics.

1. Both the foreground and the background[3] of the group’s current decision-making are available to everyone in the group at the same time.

Each individual can see the patterns that exist in the group, whatever they might be – whatever degree of consensus or difference currently exists. At the same time, each individual can see where they stand with respect to the other members of the group.

1. A tremendous amount of information about the underlying dynamics in the group moves from being “implicit, private” knowledge to “explicit, shared, public” knowledge. This allows the members of the group to focus more of their energy on the content under consideration, and less on figuring out where they stand with respect to the other members of the group on the issues.

Underlying Democratic Dynamics

Charting group patterns in this visual public manner reinforces the basic sense of democracy in the group.

1. Each individual is shown to be an equally valued individual contributor in front of the whole group.
2. The similarities and differences between the group members are also being made public. The degrees of similarity or difference are apparent to all.

This is the other side of democracy. Differences exist in democratic groups. Making this explicit allows individuals to deal openly with it. It removes much of the covertness that often exists in democratic situations. Sub-groups do form. Alliances are created.

The public group profile provides explicit insight into these possibilities. As individuals participating in a democratic process, each group member has a responsibility to deal with these similarities and differences. Making their personal stands public in a way that provides open insight into similarities and differences encourages people to do so.

The Benefits of the Psychological Disassociation

When I create a group profile in this fashion, I am actively working with the principle of “psychological disassociation”.[4]

1. I take great care in making sure that each individual has an opportunity to make a personal record of the decision about the issue before I create the group profile.  I ask them to record it. That’s extremely important. It allows individuals to experience the results of their internal decision making process, whatever it may be, from the outside in. The record of their decision making is step one in the disassociation process. They are moving from experiencing the process of making the decision to looking at a record of the result of that experience. That implicitly from them from a first position stance – experiencing – to a second position stance – looking at the results of their experience.
2. I also create a public version of the group profile, in real time, in front of the entire group. That is step two in the disassociation process. The person’s decision about each option is no longer simply being “something which I have personally experienced inside myself, and then recorded to that I can see the results of my personal experience”. When the individual verbally declares each of their decision in front of the group, and I record it on the profile, they experience another level of disassociation.  Their decision becomes “a decision that I have presented to others and seen publicly placed in the context of what others have done when they made the same personal decision.” The minute I record it, the individual experiences it from a third position, seeing it on the group profile. As result, individuals move from a “me” stance to a “my decision in the context of others’ decision” stance.[5]

The degree of psychological disassociation achieved by these actions reduces the likelihood that individual will engage in “flight – fight” personality dynamics when experiencing differences with other individuals in the group.  Differences becomes “idea or issue” focused, not person to person focused.  As a result, the possibilities for creativity within the group are deeply enhanced. The likelihood that the group will move to some level of eventual shared and creative consensus is increased. The possibility that the consensus when it occurs, is about new, creative possibilities that develop from the patterns of similarity and differences in the group is greatly enhanced.

Moving Beyond Simple Binary “Yes / No” Decisions

Starting with decisions that move beyond simple binary decisions is essential to all of this. The originators of Systematic Consensus use a scale to achieve this. I also used scales to achieve this. But based on work that I have done with Q-Sort methodologies in individual research, but I have also use option card ranking methods which I will describe later.

The technique chosen to move beyond simple binary stance must reflect

• the nature of the problem under consideration by the group,
• the time available for group work,
• and the skill / past experience / comfort level of the facilitator.

What is important is that the facilitator uses a technique that adds depth and nuance to the personal and group decision making process.

When working with problem solving groups, I often use these following steps. These steps become more and more difficult to manage as the size of the group starts to exceed small group limits (12 to 20 participants).[6]

1. I introduce overall steps we will follow to the participants in an initial group meeting. This meeting usual follows some start up dialogue with a number of the members of the group to ensure that I understand their concerns and that I am the “right fit” person to be working with them.
2. I meet with each person, in interview mode. I am trying to get a sense of each person perspective on the issues and options that the group is facing. I also start to build the rapport with each person which will make my involvement with them as a group a richer and more dynamically valuable experience.
3. Based on these meetings, I organize / summarize my understanding in a set of issue / problem statements. The language that I use reflects what I have heard. I take great care to use their language, not my own.
4. I circulate these statements to the group members as individuals for input and comment.  I incorporate their responses into a final set of statements, and circulate them once more, asking if they are an accurate depiction of the issue or options that the group needs to address.
5. I place the each statement on a card, often a simple 4” by 5” (or 4” by 8”) index card. I end up with a set of cards that define the issue or problem or options with which the group is dealing.
6. I meet with each person and ask them to rank order these cards in a way that reflects their personal perception of importance or urgency or suitability. Again, the precise language I use in these instructions comes from the group’s context.

Card sorting moves individuals beyond the verbal. They engage fully – cognitively, emotionally and physically – in this process. As they sort the cards, they are paying attention to where they place in card in relation to all of the other cards – taking advantage of our human ability to consider foreground / background patterns at the same time.

Once they are through with the card sort, I ask them to verbalize their reasons for placing the cards in the way that they did. Essentially, this provides an opportunity for them to verbalize / rehearse things they might say later in the group. I record the results of their card sort, showing the individuals how they ranked the cards from “most to least”. This becomes their personal record.

1. When the group reconvenes, I use some highly visual method to publicly record the results of each individual’s card sort into the group profile. Again, I make sure that they “verbalize” their input to me in front of the entire group.

Sometimes I do this as simply as possible, building a group profile, individual by individual, on flipchart or poster paper. At times, I get more technological, recording the individual’s input into a pre-prepared excel spreadsheet, using a computer and computer projector to project the process of building the profile on a wall or screen[7].  It depends on the group. Rapport is key. Using technology with a non-technology comfortable group is a problem, as is using paper based methods with a technology using group.

I am more likely to use 0 to 10 scales used in Systematic Consensus when I have to work with the group in a single session. I use a break out period to allow them to do the personal decision making. Using scales is easier to explain to a whole group in real time. They understand it, and need less personal direction than using card sorts. The time needed to “develop” the issues / options out of personal interaction is not needed.

Working Through Differences

Once the group profile has been built and is publicly apparent to everyone, the profile itself becomes a resource that I as the facilitator can use to encourage and to focus dialogue in the group. I can use it to explicitly move conflict from people to issues. I work with the group as follows.

1. On the group profile, I visually identify two individuals who are “at opposite ends” on an item.  I ask each person to talk to the whole group about the reasons they made the personal decisions they did. My verbal directions to each person indicate that I’m asking them to talk as a resource to the group, helping the group understand how and why they as a person came to the judgments that are apparent in the group profile.
2. I create the opportunity for the other members of the people to ask the presenting individual questions. But I manage this to ensure that these are understanding questions, not personal statements in the form of questions that are really an indirect form of disagreement.
3. Once both individuals have described their personal reasons, I turn to the group. I ask if, based on what each person has heard from these two individuals, does any member want to make a change in the judgments that is been recorded for them on the group profile.

If any individual does indicate a desire to do so, I first record the changes on the group profile in a way which is immediately apparent to the whole group. Then I ask the person who has made the change to tell the whole group their reasons for making this change. I facilitate this “change in judgment” process until no one indicates a desire to change their recorded judgment.

Clearly group dynamics, and interpersonal pressure, impact what is happening in the group during this activity. However, because each individual is changing a personal judgment which has been recorded in a disassociated fashion in a group profile, the change tends to be about the content of the ideas, not the implicit and explicit interpersonal alignments in the group. People usually provide content credible reasons for their changes.

Sometimes, the group members start to engage in discussions which lead to consideration of blended or new options that do not exist on the group profile. Often this creativity leads to clear and readily apparent consensus in the group.

What Happens Next

My experience indicates that the dialogue in the group at this point is a function of many different and interacting factors The length and intensity of this dialogue will depend on the issue, the history of the group, the nature of the individual personalities, the patterns in the group profile (large degree of similarity, bi-polar or tri-polar or … sub-groupings,) and the feelings that individual group members about the likely outcome.

But this dialogue now occurs in an environment which is deeply enriched by the amount of data about the group dynamic that is available to each individual. Groups seldom stay stuck; regardless of the difficulty of the issues they are dealing with, when this information is available to them. If consensus does not emerge from within the group, the new options can be clarified as a new place from which to recycle and start the individual judgment over again. “Stuck groups” often welcome this way of moving beyond their lack of progress.

What Happens to Individual Outliers

There is one other consequence of this type of group profile based consensus seeking that facilitators must be aware before they start using these processes. Individuals whose personal perspective on issues is dramatically different from the pattern that emerges during the group profiling are immediately identified in a public way as being different from most or all of the other members of the group. This individual must now deal with the consequences of being “distant” from the group in this way. This person can come to feel isolated, even blocked out from fruitfully participating in the groups’ further dialogue.

Sometimes such individuals simply treat this being related to the issues at hand, and continue their active participation in the life of the group or community. At other times, such persons feel alienated from the group.

People who end up with these feelings may do one of two things – withdraw from the life of the group or take a public stance of agreement with the group even when the person does not feel this. Facilitators need to be aware of this possibility, and when it occurs respond dynamically in a way that is respectful both to the individual, and to the whole group. These consensus seeking / facilitating techniques are not mechanical. They require facilitators to have deep skills, both as group process leaders and as sensitive human beings.

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[1] Hedley is long retired, although some of his books on group process continue to help and to inspire folks who work with groups.

[2] Doing so often helps me decide on the exact format to use during the real time profiling session with the group. I tend to do it this “self step” if the timing and the dynamics of working with a particular group allow me to do so. If not, I develop the profiling format on-the-fly with the group.

[3] From Gestalt psychology, see
http://en.wikipedia.org/wiki/Figure%E2%80%93ground_%28perception%29

[4] Severely disassociated personal states are considered sub-optimal by psychologists (see
http://en.wikipedia.org/wiki/Dissociation_%28psychology%29
). However, a level of disassociation from the immediacy of one’s feelings and judgments can allow an individual to be more productive in group situations. See Robert Kegan”s “In Over Our Heads” for insight into this type  of disassociation. Google Robert Kegan for much more on these “mature adult processes” when participating in public/ social life.

[5] Robert Kegan’s classic 1994 book “In Over Our Heads” for more insight into the benefit of moving from 1^st to 2^nd and 3^rd position, and the importance of this ability in our journey through life to mature adulthood.

[6] The modification of these facilitation techniques for large groups is beyond the scope of this article. But it can be done. Google “large group methods” to gain some insight into the richness possible.

[7] At one point in my facilitation career, I “decreased the time needed for this process” by preparing these profiles in advance of the group and simply distributing or projecting them to the group. I learned that the time I saved led to unanticipated consequence. Because each group member no longer went through the process of publicly providing their input to the profile, there was far less ownership of personal stances. The subsequent dialogue in the group was often far less rich and creative. I now resist the personal temptation, and often the urging of one or more group members, to do “save” this time. The process of publicly verbalizing personal decisions, and seeing them recorded as they are verbalized, is important to the dynamics among the group members.

xxx

Four Core Things I Believe About Life in Organizations

I learned something important about myself on the weekend. I am less patient with myself now and much less accepting of some of the things others in my society believe about life in organizations. I don’t expect to be seen as being any more “right” in my views now than in my earlier years. I don’t expect folks in general to agree with me any more than they did in the past – that is up to them. But I do find that I am not prepared to engage in as much dialogue about these beliefs with those who see things differently, unless that dialogue leads to real constructive action that benefits both of us.

I have worked for a long time. Over the course of my career, I have kept up a constant involvement in academic life – as a night student, graduate student, part time lecturer and distance education participant. I have and still read widely in management and workplace psychology. I have thought hard about what I was doing at work and how I was leading the folks who worked for me.

I have come to these four conclusions by reflecting on both the reading and the experience. I have quietly held them for years. They underlie all my consulting work and business related writing.

1. Performance appraisal is a waste of time if you are looking for business results.

Our evolved instinctive approaches to living in tribes makes power based interpersonal relationships vey much part of the way that we work together. We like tribally defined hierarchies. We need leaders and followers. We need to know where we stand in these tribal power structures. Performance appraisal does a fine job of addressing these needs. But it does nothing at all to increase an organization’s ability to generate results.

I have personally appraised dozens of direct reports. I have directed the building of innovative computer based performance appraisal systems. I have led the implementation of such performance appraisal systems in large large IT organizations (> 1500 professionals).

But I now accept very little of my work around performance appraisal contributed to improving the results we delivered in the organizations for which I worked. I now know that backward looking performance appraisal simply does not justify the energy it takes to do and the anxiety and mistrust that it creates in the people who were appraised.

Forward looking performance contracting is different. Performance contracting means looking ahead, not looking back. It consists of:

1. negotiating what an individual will do in the coming months and year,
2. clarifying how this relates to what others, including the person whom the individual is dependent on, are doing,
3. agreeing on how the to be delivered by the individual are going to be measured  by both the person and the boss (i.e. they each need independent access to the data that makes up the measures);
4. and then getting together regularly to review delivered personal results against the agreed upon performance objectives.

Managers who do performance contract in this way lead at work. They inspire. They shape the future through the actions of the people who work for them.

It worked for me. I have twice created IT organizations that outside auditors independently judged to be “world class excellent”. In both organizations, I did performance contracting with my direct reports, and encouraged them to do so with the people who worked for them. Together, we supported the cascade of this approach down our organization.

Performance contracting is not easy. The boss must make a personal commitment to simultaneously treating the people who work for the boss as problem solving peers and as results-responsible direct reports. Doing so involves accepting and working with the dynamic contradictions between these two roles. As power solving peers, the two people share power and a kind of equality. As direct report and boss, they are in a clearly defined power hierarchy. Recognizing and respecting these differences, and dealing with the conflict they create, takes self awareness and self containment on the part of the boss.

Bosses must discipline themselves to continuously clarify when they are behaving as a problem solving peer and when they are behaving as a results evaluating superior.

At times, bosses must negate the “power surge” that comes from being a results evaluating superior so they can effectively coach as a problem solving peer They must resist the temptation to use the power component of the relationship to simply dictate the solutions to problems when the two of them engage as problem solving peers. They must accept that simply telling does not always lead to understanding on the part of the direct report. They must act as if this is the boss’s failure, not the direct report’s, when this occurs.

At other times, particularly at the end of the performance period, bosses must take on the tough challenge of carrying though on negative consequences when the direct report’s performance has been lacking. This is not easy if the boss has developed a “liking” for the person through working with the individual as a problem solving peer. It will be even harder if the boss has failed to coach effectively in the regular review meetings between the two.

Human beings’ instinctive approach to managing performance in organizations – power based performance appraisal – is much easier, especially on bosses. It just does not motivate the folks who are appraised to produce “above every day” or excellent results.

2. Organizations waste the dollars they spend on interpersonal skill training (e.g. programs on leading others, resolving conflict …).

If behavior on the job does not change as a result of training, the money spent on it is wasted.

Very little interpersonal behavior training leads changes on the job, despite the millions of dollars spent on managerial, supervisory and interpersonal skills training. Every one “kind of” knows this. That is why there is so few systematic follow up programs to measure actual “on the job” behavior after such training programs. As long as we don’t have to face the facts, we can continue to believe.

There are two reasons why behavior change back on the job after participating in interpersonal skill type of training program is so hard.

1. Unless individuals are personally motivated, they are not going to change their behavior back at work (or in their personal lives), even it they learn the underlying ideas and concepts.

Self selection and self initiation of participation in such training is a good indicator of the needed motivation. Personally enrolling oneself in this type of course is a good predictor that the individual might have the needed motivation needed to actually change behavior back on the job. Expending personal resources to pay for the training is an even better one.

Being “sent” on such program by your organization has very little to do with having the level of personal motivation needed to actually change behavior on the job. Yet many organizations ask people to attend such training programs because the “boss” thinks it is a good thing, or because it is the norm for all people who first enter a certain job level, or because some executive has come to believe that this type of training has pay back.

2. Individuals behave in interlocked patterns at work. If one person changes his or her interpersonal behavior, the others the person interacts with have to change theirs as well. These other people are often not motivated to do so. Instead, they put group peer pressure on the person who changes his or her behavior after attending a training program to revert back to the old behaviors the person had before they went on the training program – the social extinction effect. Most individuals who try to implement new behaviors do revert back to the old behaviors in the face of this implicit social pressure. The training investment is lost.

The individuals who persist in wanting to change their behavior after such training often respond to the peer pressure by finding new people to work with. Usually, this means moving to a new job. Often, that new job is with another employer. The training investment is lost.

Organizations who want to really change interpersonal behavior patterns need to engage in systematic culture change programs. As well as training, such programs involve visible recognition and compensation programs that reward the “new behavior”. These programs also involve specific activities that counter “resistance” to change on the part of current members of the culture.

Such programs are difficult to plan and to execute. They must work from the top down and the bottom up in a coordinated way. They are intensely resource demanding. They require persistence over extended periods of time. Few organizations succeed at such culture change programs at the level of “walk”.  Most organizations though engage in “talk” as if they are doing such things, even if they don’t really do them.

There are a couple of simple things to consider as a result of these dynamics.

If you invest in an individual’s interpersonal behavior change, you need to move them into a new job to have a reasonable chance of recouping on your investment.

When individuals are motivated to spend personal resources on changing their interpersonal behavior at work, they are also at high risk for leaving your organization in order to find another job where they can practice those new skills.

3. Interview based recruiting is all about “good enough” hiring, not future performance excellence on the job.

The academic research is clear – talk during recruiting interviews is not correlated with eventual final candidate performance on the job. But everybody continues to do to use talk based interviewing as their primary recruiting tool. Why?

Talk based interviewing finds “good enough” candidates – both on the technical skill level and culture fit level. Talk based interviewing does not systematically succeed in finding the “best candidates”. It does not need to. Good enough is good enough for most organizations. Few organizations are really excellent. Most organizations talk ‘excellence”, even when they don’t “walk” it.

It is possible to recruit for excellence. It takes “show us how you will perform with the people that you will be working with” recruiting techniques. This means crafting work based role plays and work based simulations. They are more difficult to set up and to facilitate than interviews. Creating them, and then facilitating them, is far beyond the skill of most recruiting professionals.

The best way to see how a person will behave in the future – on the job, is to get them to behave currently.  Get candidates to do, not talk about what they have done. Even “behavior based interviewing” does not do that.

Job based role plays and work simulations go some way to allowing the assessment of performance fit. Involving future peers in interacting with candidates and then systematically collecting their impression of fit allows some level of assessment of cultural fit.

The best hires – excellent performance fit to a particular job and superb emotional fit to a specific organization’s culture – are often temporary folks who have already “demonstrated” how they will perform on the job. You see what they can do and how they will interact with their fellow co-workers during their temporary assignment. The best predictor of future behavior is always past behavior.

Bringing the person in on a temporary basis is the best way to assess both performance fit and culture fit. It remains the best hiring tactic if you are hiring for excellence. If you are not, and most organizations do hire for good enough, then the talk that happens in recruiting interviews will do.

4. Many human abilities are as much instinctive as thoughtful. Excellence at work requires thought rather than just responding instinctively.

More and more, modern research is showing how much of our human capability to do and to interact with others utilizes ability systems that located in the pre-conscious parts of our brains. These evolved ability systems let us become the dominant species on the planet hundreds of thousands of years ago.

Somewhere in the past 40,000 years or so, we began to move from being tribal creatures to being societal ones. We started to live in conglomerations of individuals which were bigger than one tribe. Previously, as simple tribal members, we might have had occasional interactions with members of a number of other geographically local tribes. But as societal creatures, we developed (i.e. added) the ability to be concurrent members of a number of tribe-like social collections that exist within our societies.

As societal creatures, we developed organizations that specialized in achieving at least some of the objectives of each of their members. We shaped these organizations in which that reflected our evolution as tribal beings. Our organizations have hierarchies and insider/outsider dynamics that we developed as tribal creatures. At the same time, as societal creatures, we developed shared mechanisms and processes for collaborating within and across these organizations.

Organizations traded with other organizations for the resources needed to achieve those objectives of each organization’s members. Thoughtful, structured, planned ways of interacting with individuals in these other organizations became as important a part of our human abilities as our instinctive ways of interacting with other individuals in families and in tribes.

Today, we have all these types of ability. Our gene based evolutionary history adds new abilities to our competency repertoires. It does replace the ones we already have with new ones. Neither does evolution act to integrate new abilities with old ones in balanced way. As a species, we have simply added the new more thought based organizational abilities to our older instinctive interpersonal familial and tribal ones.

Stress is a large of our organizational and societal life. Under stress, we tend to fall back on our instinctive abilities, even when they might not be as effective for dealing with a given situation as our thoughtful abilities. Our instinctive abilities often define our business and societal interactions. Much confusion and turbulence occurs in organizations and in societies as a result.

Understanding and mitigating the results of these dynamics requires that managers in organizations consciously override their instinctive first responses with careful, thoughtful, analytically-based responses. The next generation of organizational behavior writing and business professional development curriculum needs to be much more clearly explicit about the evolutionary nature of human abilities. We need to move from theories of “emotional intelligence” to ones that more clearly reflect the additive evolution of our abilities. We need to make sure that managers understand that they concurrently have instinctive interpersonal and thoughtful organizational abilities. We need to help them recognize that our instinctive abilities, the ones we all move to under most levels of stress, are not the best ones to use to respond to the demands of organizational and societal life.

Conclusion

There is tremendous hope for us as human beings. Our evolution has given us the ability to shape our collection future through collaborative, thoughtful organizational action. But we often do not. Our evolution has also given us the capacity to interact in ways that are firmly embedded in the pre-conscious instinctive abilities that evolved when we were members of families living in tribes. We need to move beyond the familial and tribal in organizational and societal life in order to have a future of hope, not one of self defeating strife.

Facing Our Future: The Age Driven Dilemma in Western Society.

Let so many of my contemporaries who are past 55, I am finding harder and harder to find interesting work. The next generation of managers – the folks in their 30s, 40s and even 50s, are simply not comfortable working with us. As a result, they tend not to hire us as employees or engage us as contractors / consultants.

The “freedom 55 myth” that pervades our societies makes that reality for many members of my generation even worse. These marketing myths suit the pension plan industry and the banks but do not really mirror social reality. Surveys have shown that many folks do not have well crafted or stable pension plans. Some of us simply had careers that meant we did not stay with one firm long enough. Others saved and invested in the stock market, long considered a haven for retirement saving. The stock market’s main purpose used to be raising capital for business enterprise. Today, speculative and computer algorithm based short term profit taking dominate its dynamics more and more. Retirement oriented investments are often not stable enough or generate enough steady return to provide adequate income for retirement time periods that get ever longer. Life expectancy is steadily increasing. More and more people are staying healthy for longer periods. Modern medicine now leads to recovery for things that used to mean death.

Retirement income needs are increasing. The actuarial pool model that underlies most pension plans – many people contributing over a long period of employment but not all of them living for a long retirement periods to take out their benefits – is being progressively undermined by the reality of our social dynamics

Many of the folks who expect stable pensions will be rudely impacted in the next 1 to 30 years as their pension plans struggle with demographically based declining contributions at the same time as more people live to expect benefits for longer periods of time. Many apparently stable pension plans will simply collapse under these pressures.

Income from a pension plan is not my problem. I don’t have a comfortable pension plan that is managed by someone else. I chose to invest in entrepreneurial ventures in my late forties and fifties. I did not succeed in them as I had hoped. So generating income in some way will always be part of my life.

But then I never expected to retire either. I always wanted to continue working as long as I had the health to do so. I seem to have lucked out in my genetic endowment. Three of my four grandparents lived long productive, socially active lives into their eighties and nineties. More and more, the evidence indicates that genes combined with exercise, diet care moderation and modern medicine increase the probability that I, and many others, will, live longer than most folks in previous generations. If I want to work, I am likely to healthy enough to be able to do so.

My model of my life’s progression, and the continuing place of work in it, was different from the one inherent in the “freedom 55 myth”. I experience work as providing me with dignity, a place for being creative, an environment in which I continuously learned continuously and a sense of personal joy in who I was professionally. It was not a “grind” from which I needed freedom

So, it is with some surprise that I am facing my current situation – a social climate that does not support many of my contemporaries and myself in our desire (and our need to) work actively in the later stages of our lives.

The shared employment models common in our societies have not kept up with this growing social reality. Jobs are still seen as part of a career leading to retirement. Instead, we need to start thinking of them being a life long need. The numbers of hours may decrease with the age, but not the need to emotionally engage in meaningful and income generating work.

Corporations still staff their human resource executive posts with individuals who hold the “freedom 66 myth”. They fill their recruitment teams with younger people who don’t really have a sense of the new social reality faced by a large number of people in their 60s and beyond.

Not all of these older folks find fulfillment in travel or babysitting grand kids or going to the community center. They describe themselves as “young minded” in a way that is new in our societies. For many, their sense of personal identity is strongly connected to making a valued contribution to the society they live in through some level of meaningful work. In addition, they will need the income generated to live with dignity and a sense of self resourcefulness.

Increasingly, such folks will become more important in the voting dynamics of our modern democracies. Unfortunately, our politicians are out of touch with much of this. Their own pensions plans are among the best sheltered in our societies. But as keepers of the public purse, they are beginning to panic about the growing strain this age driven change places on our collective social finances. So, we hear then talking about limiting public pension benefits, supporting the change corporate pension plans from defined benefit to earned value and so forth. They do all this while blindly assuming that their own pensions will be inviolate in the hands of future politicians.

Today’s politicians do not seem to understand the needed deeper social changes that are required to cope with these age drive societal dynamics. These changes need to start with an update in our shared model of what constitutes a productive life in our society and how this relates to employment.This change will require a long period of sustained dialogue at all levels of our societies, public, private and individual.

Politicians are more reactive than proactive. Their short term orientation, driven by the next to win the next election, blinds them to longer term social dynamics. They are not leading, or even just facilitating, the dialogue needed to create the “new solutions” – solutions with involve some fundamental changes in the shared way that we think about the age related progression of our lives in our societies.

Neither are the “associations” of older people in our societies providing productive leadership. They are still largely oriented to lobbying current politicians to get the “benefits” of being older – stable, inflation protected pensions, government paid medical benefits, and stable social conditions in which they enjoy traditional view of retirement – as a time to “stop” the grind of work and travel and relax. But this will change.

The crisis faced by the part of the older generation who today do not have the pensions they need to live with dignity will expand as more and more pension plans cannot cope with financial demands placed on them. When that happens, a new political dynamic will emerge in our society – that of the older voter angry at the failure of social contracts they felt they could count on. The time to start addressing this dynamic, and making it a positive one, is now. If we do not start and sustain the societal dialogues needed to make changes in our current models of retirement and employment, we as a society risk an angry backlash by older people. That is not a good prospect in democracies in which older people’s share of the popular vote is increasing.

The Jobs and Technology Elephant in the Room No One Wants to Talks About

A Little History

It’s 1965. I am working as a junior clerk in the research and development department of a national railway in Montreal, Quebec, Canada. My main task is to type up the results of pricing estimate calculations done by one of the approximately 125 men who sit in 10 ranks of desks behind me, 12 to a rank. They all work on the most advanced Friedan mechanical calculators. Their job is to use the local knowledge that they developed through practical train handling experience on parts of the cross country rail network to work up price estimates for the point to point potential movement of goods for customers.

These men share some important traditions. For the most part, they are all older men with a long career working around freight trains on the railway. When one of them retires, they all move up a desk. Understanding your career path is easy in this department.

Whenever this happens, a new recruit is found out on the rails. Many men out there want this desk job. It pays better, and the work is warm – office work. But not all of the who want the job have the math skills needed to do the job. Only the ones that can demonstrate them get a chance.

The department chief clerk also takes care to ensure that knowledge of the rail configuration for entire railroad is always present in the room. Understanding your career path is easy in this department.

Once here, the new man rapidly learns to take part in the group’s Friday afternoon tradition.  They called it “the train leaving the station”. At 4:30, the most junior of them, sitting at desk one in rank one, entered 999999999 times 111111111 into his calculator. As his Friedan started chugging out the calculation, the man behind him did the same, and then the next man and so on. The sound in the room sounded just like an diesel engine picking up speed as it started out of a train station. By just before 5PM, the last calculator sighed to a stop. The men got up and go home for their weekend.

Then along came a young engineer called Russ. He has just learned FORTRAN at a special course for engineers at the local university. He thought he could program an IBM 60s mainframe computer to do these calculations.

It took Russ just three months to write a computer program which estimated pricing for movement of various goods from point to point in the network. It took him another 3 months or so to capture the local knowledge of the 125 men in the desks behind me in a variety of tables that he used in the program.

The men and the program work side by side for a month. At the end of the month it is clear.  The program can produces results at least as accurate as the calculations done by the men. And the program can do it must quicker, even in a batch card mainframe computer environment. Beside speed of calculation is not that important. Overnight results are perfectly acceptable. That is faster than the fastest of the men, who usually took two days to complete a pricing estimate.

The computer program is implemented_. 126 jobs disappear overnight (theirs plus mine). It’s the first first time in my career that I experience the ability of technology to destroy jobs. My response is simple. I learn how to program computers.

Since Then, I Have Been in the Business of Destroying Jobs

First as a computer professional, and then as an IT executive, I have delivered on countless technology project. Every time, the business case was based on replacing the cost of people time with far less expensive, and often much more reliable, machine time And I am not the only person to do so. Business has been doing this steadily since the beginning of the industrial revolution. But computers made it possible to extend this from the factory floor to every aspect of enterprise.

At First, We All Benefited

The tremendous increase in productivity that we have experienced in the Western world since the Second World War is the result of the applying technology to making of things, the growing of food, the harvesting of useful things from nature, and the management of information in offices. The resulting productivity growth has driven a dramatic increase in our quality of life. Every thing became cheaper at the same time as average income increased. To most of us who grew up after the Second World War, it seemed like this would never stop.

But I never forgot that first lesson. The economics of technology investment is simple. Replace something that costs more in the long run – human labor – with some that cost less in the long run – machine labor. As long as we lived in a world where we could endlessly expand – because we were trading with the underdeveloped economics that were far behind us – or because there seemed to be no ecological cost to exploiting natural resources, our societies just boomed along.

Technology Ruled, and Had a Hugh Impact on Defining our Society’s Culture

We live in societies where jobs, as well as being the source of family income needed to maintain the family’s members, are an important part of our identity as social beings. More and more, after the beginning of the 20^th Century, a job defined who a person was. Job based income was the primary way to support a family. Sometime during the 19^th century, for most people, who you were socially became less a function of the land you owned and more a function of the work that you did.

And this trend continued during the 20^th Century. By the end of the century, this was true for most of the women in Western societies as well. Women entered the labor force in large numbers after the Second World War. Their jobs, as well as the job based income they contributed to their families, became an important part of their personal identities as well.

Increasing Productivity, and Aggregate Growth In the Size of the Gross Domestic Product, Became the Core Way We Defined Progress in the 20^th Century

Throughout the 20^th century, we kept finding new ways to use technology to reduce the hours of labor (which translates to the number of jobs) needed to produce the products we needed, the food we eat, the raw resources we harvest, and the services we consume. As we were doing so, we were also constantly increasing the “quality of our lives”, measured largely by disposable family income, and an ever increasing supply of products, food and services. We knew that we had it good. And in the short term, year over year, we did.

Human Beings are Not Great Long Term Anticipators

We are human. Our evolved strength as individuals is to look out over this season, and do some planning for next one, and maybe the one after that. A few of us think about over longer periods of time – as measures by generations and decades. But most of this is speculation. Of all of the speculation that was done in the 20^th Century about the future, only a very small percentage turned out to be accurate, as evaluated by the passage of historical time.

Even when those of us who speculate about the future share their speculations in writings and other forms of communication, most of us don’t act on what they say, either as individuals or as societies.

The Consequences of the Destruction of Jobs by Technology Has Built Up Steadily

In the last five decades, we destroyed jobs in manufacturing, in agricultural, and in harvesting natural resources. When we first realized that this was happen, we talked about becoming a service based economy. The productive use of technology in manufacturing, agriculture and harvesting allowed us to create more jobs in the service sectors in our economics.  We took some of the economic “wealth”[1] created by this growth in productivity, and used it to “finance” the creation of these jobs.

Then toward the end of the 20^th century, we started to apply technology to office and other service jobs. We began to have some sense of what the inevitable impact of this trend. But we were not clear about it. So we talked about becoming a knowledge based economy.

We still needed jobs, both for the identity they created, and for the job based income we needed to support families. As we used technology to destroy office and service jobs in the public sector, we created more and more new jobs in government. We also expanded tax financed service sectors such as health care and education. To pay for it all, through the magic of money, we also started to accumulate growing government debt. We used money to put off the real bill for all of this somewhere into the future. We believe that the growth boom we had been on for the past 100 or so would never come to an end. We believed that future productivity increase would somehow allow us to cope with this debt.

The Internet and the Export of Jobs

Then in the last decade of the 20^th century, we created a technology which made distance largely irrelevant to doing work with information focused work – the Internet.

The relentless economic logic of our short term, year over year, profit maximizing capitalistic investment models led to us continued to kick in. We use the Internet to export more and more of our remaining manufacturing and agricultural jobs to “offshore” economies where the lower cost of living generated a short term profit maximizing advantage.  Communication over the Internet, combined with the technology of air travel, allowed us to effectively manage these distance jobs.

We are now doing the same with public sector information based and other service jobs. Only political pressure, exerted through lobbying on our politicians, has slowed the pace at which we export agricultural, health care, education and government jobs to the lower cost of living parts of our globe.

A Short Term Blessing, Long Term Pain

Our dedication to the relentless economic logic of short term, year over year, profit maximizing investment that has helped us become more productive over the past 5 decades is being to catch up with us. It had huge benefits. We expanded technology under its logic. We increased the quality of life for most Western people under its influence. It is a classic example of the vision strength that our evolution has given us – the ability to act energetically this year’s seasons, and to look ahead to next year’s seasons, and perhaps the year beyond. Sure, the theory for looking longer is there. We do 5 and 10 and 20 year return on investment calculations. But we act in much shorter time frames. We are not really very good at anticipating the longer term consequences of our short term smart actions. Most decision makers did not want to create global warming and environment destruction and resource deletion. But we did anyway.

The Same Pain is Now Starting to Happen With respect To Jobs.

As we destroyed jobs in manufacturing, agricultural and natural resource harvesting, we compensated by creating more jobs in government and tax-finances services. The consequences of doing so are now become dramatically clear.

• The more government jobs we created, the more government gets involved in the day to day detail of our commercial and private lives.

• The more health care and education jobs we created, the larger their proportionate cost when compared to our gross domestic product became apparent. We are being to become concerned about our ability to pay for all of them out of tax based finances.

• The more jobs we exported to lower cost of living economies, the less national family income there is to support our families and the smaller our tax base for paying for those government, education and health care jobs.

No One Openly Talks about this “Elephant in the Room”

We don’t talk about this “Jobs and Technology Elephant in the Room” dilemma in our public discourse. We can’t blame anyone for it, tempting as it is for some of us to blame big business or political leaders. It is simply another consequence of our evolved strength as human beings – act to shape this year’s seasons, and next year’s, and maybe the seasons after.  We might talk about longer time frames.  But we find it almost impossible to collectively come to consensus about how we should act in the short term to avoid negative impact of job destruction in the longer term[2].

Instead, our politicians talk about investing in innovation or in small business or in new infrastructure programs as ways to create new jobs, and solve the loss of job problem.  They are out of touch with the longer term dynamic inherent in investing in increasing productivity through the use of technology.

It is a Deep Structural Problem that Comes From Being Human

None of our current political talk will solve these basic underlying structural problems.

Some people reading this essay will respond by saying “your logic is too simple”. But like all such logical simplifications, it has one great value – it illuminates.

Because the logic used here is rather simple, you can point out lots of specific counter instances. Unfortunately, doing so does not invalidate the relentless reality of the following logic.

1. As human beings, we extract things from nature, through harvesting or through growing, to meet the needs of our lives – sustaining ourselves and creating and supporting our next generation.
2. As tribally evolved creatures, we have invented complex forms of social collaboration to make that process more productive – the sum of what we accomplish in groups through specialization of labor and trade of goods / services is far greater than what we can produce as individuals.
3. We now use work based income as the main means to distribute the economic results of that social collaboration. We use jobs to allow individuals to get the income they need to participate in the highly symbolic societies that we have created in the past 10,000 years or so.
4. We participate in those societies because we evolved as human beings to develop ourselves (I-Me), take part in relationships (We Two), live in families to nurture the next generation (Our Family) and belong to tribes in order to define our social identities (My Tribe).

Of course, we no longer do all of these things as simply as our ancestors did millions of years ago. Most of us belong to more than one tribe for instance. But the underlying psychodynamic of being a human being has not changed all that much in that time.

1.  In the past 150 years or so, our ability to develop and to apply technology in an ever more productive ways has resulted in the integration of our societies into a global network, inter-dependent on trade in goods and services to ensure our collective well being.
2. In the past 50 years or so, the relentless logic of our short term, year over year, capitalistic pursuit of profit in our integrated global economy has led us to substitute technological labor for human labor, or to export human labor to the lowest cost part of the global.

We will of course eventually use substitute technological labor for human labor there as well, once the cost of living standards become more equal across the global.

But this whole approach to managing technology – substituting technological labor for human labor while using job based income to support individuals and families – is no longer sustainable in its current form. It is destabilizing our societies, both nationally and globally. The signs of this are all around us.

The Signs of Global Destabilization

1. The global debt crisis threatens international stability and personal well being.
2. The growing loss of employment opportunities for our youth threatens the stability of our societies.
3. The growing pension crisis threatens the well being of the older part of our population. This will undermine the stability of our societies.
4. Global warning, which is the result of the unanticipated consequence of our current ways of producing and using energy to mobilize our societies,  can undermine our societies.
5. Our collective inability to control our societies’ dependence on the limited natural resources like oil and gas and the ocean’s clearly declining fish stocks will undermine our societies.
6. The unlimited exploitation / destruction of forests could have a negative impact in the natural process that refreshes the air that we breathe. Our collective inability to address that and institute a substantial approach to the harvesting of resources form our forests can undermine our societies.
7. The growing political instability in parts of our world and the associated confrontation dynamics engaged in by leaders at the national level fuels the constant nagging concern that that we could experience fuel nuclear based confrontations that could dramatically alter the nature of our globe, at least in part.
8. The growing distrust of the average citizen in the ability of their governors / governments, whether elected or imposed or hired, to address these dynamics, never minds solve these problems is undermining our societies.

So what is the solution? 

I have ideas, but I fully accept that I DO NOT KNOW. I also do not believe that any other INDIVIDUAL knows. The issues need collective responses. The only thing that I can do is express my ideas on these issues in order to contribute to this collective dialogue. If others agree, then I have done what I can do. If others have been ideas, then I need to listen and be persuaded by them.

I believe that we need new forums (and also forms) of dialogue that bring people together, both within and across societies, to talk about these issues and invent new ways of address them collaboratively[3].

Collectively, we have evolved as collaborating tribal creatures.[4] We need to come up with new shared models – ways of thinking – new forms of culture – new shared ethical norms -  which allow us to tackle the following challenges.

1. Move beyond the relentless short term, year over year, pursue of profit, while retaining the positive aspects of capitalism – its fostering of innovation, its creative destruction of old ways of doing things so that they are replaced with new ways that produce more with less and do so in a way that is not destructive of either people or the ecology of our globe.
2. Create ways of living that allow human beings to live as dignified family members that are committed to the successful rearing of next generations, however the family is defined and takes into account personal sexual preferences.
3. Create models of work that allow human beings to excel as individuals while as the same time recognizing the vast variety and variability of individual capacity, motivation, and drive, which at least in part results from the differences in the genetic and rearing endowment we each receive before we can exercise effective personal choice.
4. Create political institutions that recognize limitations of our “I-Me, We Two, Our Family, My Tribe” psychodynamic inheritance from our evolutionary history, while more effectively dealing the needs to plan and to anticipate the consequences of our social decisions on our ecology over time spans that exceed the current and next generation, so that we don’t inadvertently destroy the future quality of life of our descendants not yet born.
5. Replace the current societal definition of personal identity as being partially dependent having (or having had) a job that is current in at least Western societies with one that is more focused on making a contribution to society over the course of one’s life in a variety of ways.
6. Replace the current use of job based income as the way in which the majority of individuals get the economic resources they need to support themselves and their families with an alternative that still fosters personal initiative and a sense of responsibility for self (i.e. not living out of your neighbor’s “wallet” by saying that the “government should” support” your or provide services and resources you need at no cost to you).
7. Create forms of economic, governmental, and personal accountability, based on complete transparency of information, that essentially eliminate the large amount of intended fraud and societal posturing that allows those of us who are most self serving to take advantage of those of us who are more narrowly focused on the meeting the needs of our personal and family lives.

None of this will be easy. But we better start, or we will lose control of our future, both as individuals and as members of our societies. If we start to do this, we will also come up with solutions that make the “Job and Technology Elephant No One Wants to Talk About” go away of its own accord.

I believe that the Internet, and talent from the so called underdeveloped world, will be a large part of meeting this challenge.

I also believe that our understanding of the nature of leadership will need to be completely redefined, moving from a model that is based on “I am the leader of the tribe and therefore you follow” to one that asserts “I am highly skilled at facilitating, both through my personal persuasion of others and through my use of Internet  to facilitate dialogue which allows people to collectively invent and communicate new ways of thinking and acting about how we live on our globe”.

We are an amazing species. We have the ability to recognize our limitations. At our best, we cope with any long term dynamic our short term strengths create for us. At our worse, we engage in mutual destruction (e.g. war) fuelled by fantasies[5] of what the world and others are like.

We have a choice. We have free will when it comes to the future.  We can create solutions out of collective dialogue that will also get beyond all of this. Or we will not. It is simply a question of choosing in our personal lives. The other amazing thing is that we now have a technology, the Internet, where personal expression has the potential to persuade others in a way never before experienced on our globe.

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[1] The role and nature of money, a form of shared social meaning created by human beings to facilitate the development of ever more complex forms of social organization, really needs to be part of this story. But this is beyond the current scope. As a result, I use worlds like income, wealth, finance, and economy knowing full well that I am avoiding explaining how the human creation and use of the idea and social reality of money impacts this all.

[2] Our ongoing collective failure to respond in a coordinated fashion to climate change and the over exploitation of the ocean’s natural resources are the two clearest examples I know of this dynamic result of our evolution.

[3] These forums and forms of dialogue must be much more effective that the current international set of meetings in which politicians and bureaucrats (the governors) engage (e.g. on international trade, climate, regulation of the oceans …). These current gatherings are really just meetings of the privileged. Unless they become far transparent and far more accountable to the world at large, not nation’s internal political elites, their only real result will be to continue to convince the globe’s people at large that politicians and governments are completely ineffective in dealing with the globe’s real dynamics.

[4] As well as warring ones – but that is a topic for another day.

[5] I wanted to say “paranoid fantasies”.

Why the planned Facebook IPO is not really about creating value?

Roger Martin, Dean of the Rotman Business School in Toronto, recently wrote about the problems plaguing capitalism in the 21^st Century. Among other things, he calls for us to focus more on “creating value, rather than trading it”. The current news frenzy about the impending size of the Facebook IPO is a prime example of how our media and investment communities have become fascinated with “trading value” rather than creating it.

What things of value has Facebook really created in its history? Not much really, in my opinion. All of the technology that Facebook uses already existed, or has been created by human beings not associated with Facebook. Zuckerberg and his team have not really created anything new. They just applied existing software and hardware technology to something it has not been applied to before. That is not the same thing as creating some fundamentally new – creating value.

The innovation that Facebook can claim is that it has allowed individuals to engage over computer networks in a form of communication that has been important to human being for generations that go back past recorded history. Let’s go on a bit of a bio-evolutionary sidetrack to understand this, and then come back to the planned Facebook IPO.

We evolved as social and abstracting, language-using beings. Our multi-layered, complex brains developed over many millions of years and endless generations to cope with the complexities of our lives. Our evolutionary history has resulted in our having brains that can do more than one thing at a time. We have continually added capabilities to our brains, adding the new abilities to while retaining old ones. As a result, we have many capacities that occur at a preconscious level. We have others that result from the interaction of old abilities with newer ones. As a result, our internal psycho-dynamics involve 5 highly intertwined streams of capability.

1. I- Me

We live with a sense of self (I-Me) that is capable concurrently of being-in-the-moment (I) and dissociated from that immediacy through conscious reflection on my immediate being (Me). We are probably the only species on the planet that has this ability. (Although our inability to communicate intelligently with some other highly social species – whales, dolphins, and perhaps elephants – means that we cannot really know for sure.)

2. Us Two

We form and thrive in complex multi-layered pair-bond relationships that last over long periods of time. We form them not just for the purpose of reproduction, but also for enhancing our personal survival, sharing physical and emotional pleasure, increasing our personal growth, and enhancing our status in our social world.

Although other species form pair bond relationships, we humans invest them with a level of meaning and importance that seems unique. We bring our concurrent I-ME psychodynamics into them. We are the only species on the planet that is consciously obsessed with the moment to moment and long term elements in our pair bond relationship.

3. Our Family:

We raise children for an extended number of years, taking them through a complex series of development stages that equips them to live as adults on all of the levels captured in the phrase “I-Me / Us Two / Our Family / My Tribe / If –Then”. We are a unique species in this regard. We have the longest and most complex developmental history of any species on the planet. As a result, the importance of, and the amount of time we spend being aware, of “our family” history and connection is also a defining characteristic of our species. We cannot separate our sense of self (I-Me) from our being a member of “Our Family”.

4. My Tribe

We lived in tribes for far longer than we have lived in societies. Tribes are collections of human beings that number in the hundreds. Each person in a tribe knows, at some level, all of the other members of that tribe. This is the most fundamental characteristics of the tribal human psychodynamic.

Societies are far larger than tribes. Societies are collections of tribes. Societal dynamics are the result of the fact that when living in a society, an individual can be a member of multiple tribes. For instance, when you go to work, in participate in the life of your “work tribe”. When you go to a sport bar and cheer your favourite team with your friends, you participate in the life of your “sports” tribe. When you participate in the activities of a political party, you are a member of your “political” tribe. This is a fundamental characteristic of a society. It allows individuals to concurrently participate in the life of multiple tribes.

Human beings have lives as individuals, as members of families and as members of tribes for millions of years. They have lived in societal groupings for thousands. Although no doubt, evolution is adding capabilities to our brains for participating in societies, we are the very early beginning of this evolutionary process. Most of the time, we cope with the pressures and issue of societal life by using our tribal psychodynamics.

Many of the difficulties we face in current societies come from the fact that we evolved as tribal creatures, not societal ones. War for instance started as an inter-tribal dynamic, when tribes competed for limited resources. We now live in a world where our grasp of technology and our application of it to the tribal business of war threatens our existence as a species. Today in war, our internal psychodynamics, including our emotions, are tribal, but our probability of survival is based on the enormously destructive application of science to the technology of war. War has become disconnected from its first purposes, ensuring the survival of the tribe. War now threatens our survival as a species, something it has only done in the past two centuries. Yet we seem unable to stop war.

We evolved complex in-group / out-group psychodynamics that allow us to participate effectively as individuals, as pair-bond mates, and as family members in tribal life. Our ability to exchange good / services (trade) and our capacity to bind our behaviour through contracts (live by law) developed from our living in tribes and from our interacting with members of other tribes.

We respond to tribal based normative patterns that govern our I-Me, Us Two, and Our Family behaviours. We follow leaders that are necessary for the success and survival of our tribes.

But often the limitations inherent in these tribal capabilities seem to distress the societies we now live in. Just look at the negative parts of the current political process, of which the negative advertising current in the US Republican race for the Presidential nomination is only the latest example.  in the US.

5. If-Then

As well our abilities on these four human levels (I-Me / Us Two / Our Family / My Tribe), our evolving brains also developed the ability to abstract and to reason using language. We have the capacity to think and to reason about space in that that is not limited by the fact that we live, like all living creatures, in an immediate here. Our sense of space transcends the immediate space we are acting in. We think and talk about the here and the there naturally, without questioning the wonderful thing that this ability really is.

In same way, our sense of time is longer than the immediate moments in which we live. We abstract from this immediate now, just as we abstract from the immediate here in which we live. As a result, we have a conscious sense of time that includes the past, the present and the future.

These two capabilities are the basis on which we evolved our ability to logically reason. If-then reasoning involves putting things in past-future sequences. It can only develop if we have a sense of time which includes the past and future – an abstract sense of time.

In the same way, spatial if-then reasoning can only evolve once we have a sense of here and there – an abstract sense of space. Language was necessary to, an evolved as part of us having a Us Two, Our Family, My Tribe level of psychodynamic capability. Language is the framework within which we developed to have ability to do past-future and here-there if-then reasoning. Our ability to logically reason is the result of our complex lives as I-Me, Us Two, Our Family, My Tribe creatures.

Our evolved logical, reasoning abstract consciousness interacts with the preconscious many systems we use to deal with the needs of ““I-Me / Us Two / Our Family / My Tribe” lives. We are not consciously aware of much of this interaction.

Side Note:

But we are developing the ability, through our societal creation of disciplined forms of communicated thought (i.e. science). to gain insight into these dynamics. Our creation of technologies that allow us to examine our brains’ functioning from the outside in (e.g. thermal and magnetic of brain functioning) is contributing to this growing insight.

It will be interesting to see where all of this will lead. More and more, we applying the “if-then” – logical reasoning part of our mental abilities to generating insight into the way that the “I-Me / Us Two / Our Family / My Tribe” parts of our brains work. We are only just beginning.

We also use time and space abstracting, shared logical reasoning to create technologies which have and are dramatically restructuring the material conditions of how we live on this planet. We are being to realize that not all of this may be positive for our future as a species. But we have evolved over millions of years, and barring a self made planet wide disaster, are likely to continue to do so for millions of year to come.

Personal Note:

The only reason that I might want to travel in time is to see where this fascinating l I-Me / Us Two / Our Family / My Tribe / If –

Then evolutionary process might take us in a million years or so. Ah well – it is not to be.

So how is all this relevant to Facebook? What Facebook did was automate one of the two integrating capabilities that evolutionary human beings have developed to cope with the needs of their complex internal psycho-dynamics – gossip. Telling stories about our selves, our partners, our family members and the folks in our tribes is profoundly important to re-affirming who we are on the “I-Me / Us Two / Our Family / My Tribe” levels.

Our other great integrating capability is story telling. Stories, starting with the family stories we hear as children, help us make conscious the results of the complex, intertwining of our I-Me / Us Two / Our Family / My Tribe psychodynamics. Stories, both historical and fictional, also educate us about “what we might be” as a result of our intertwined internal psychodynamics. This explains the tremendous importance of all forms of businesses related to story telling in human history, e.g. writing, publishing, entertainment, movies, etc.

Facebook uses existing technology to make gossip – personal story telling – easier for people. Facebook extends their ability to do so over distances and times that exceed our physical limitations. Suddenly, using Facebook, you could tell a story about yourself or another individual that could be access by other people even though they were far away or not connected to you in you’re here and now time. Given the importance of gossip and story telling in human life, it was no wonder that Facebook took off once people realized what it could do.

As it matured, Facebook the organization then used the size of its community to attract high levels of advertising revenue. Advertising is a form of human story telling devoted to selling products and services.

As a result, Facebook makes billions of dollars annually. But it is from doing nothing something fundamentally new. I personally believe that Facebook almost blundered into this combination of  success factors, using technology to extend the reach of human gossip – personal story telling. But I cannot be sure. After all, I was not there as Facebook the organization developed and grew. That also explains why I am not as rich as Mark Zuckerberg.

I am not the first person to say that Facebook “really does not need the money”. So why is it bothering? How will Facebook use the almost 4 billon in cash it has on its balance sheet and the new 5 billion that financial pundits are saying an IPO will raise? Will Mark Zuckerberg and the other folks who control Facebook use this money to “create new value”? My bet is no.

Instead, I believe that we will see Facebook “trade value” through acquiring other technology companies. That will be unfortunate. But Facebook’s has a history not really creating anything fundamentally new. Instead, it almost blindly applied technology that already existed to parts of human life that had not been automated before. The founders of Facebook seemed overwhelmed by the fact that Facebook’s appeal extended far beyond the universities that they saw as their marketplace just 7 or so years ago. All of this leads me to believe that “trading, rather than creating, value” is the most likely future use of all of this money.

Shape The Future, Don’t Appraise the Past: Performance Contracting is the Key to Employee Engagement and Organizational Excellence

The HR and business press is full of articles about how Generation X, Generation Y and the next Generation now entering the work force are different from the Baby Boomers ware about to retire. But in one way they are not so different. Employee satisfaction surveys still tell us, like they have for the past forty years, that employees do not believe that performance appraisal helps them improve their performance.

So why are we as managers not listening? There are a variety of reasons. Some have to do with organizational inertia. Some have to do with the fact that managers appreciate the re-enforcement of the relative power positions inherent in performance appraisal. But most importantly, we, as managers, really haven’t had the business support systems that we need to move from performance appraisal performance to performance contracting.

Contracting for performance with our direct reports requires that we commit to the regular independent delivery of feedback to them. That feedback has to be based on agreed upon metrics. Those metrics, in the majority of cases, need to be tied to the automated business applications that we now use to run our business.

So the business tools that we need are finally there. Now all we need to do is change our attitudes. We need to stop appraising people. We need to stop telling them what they did and did not do in the past. We need to stop rating them on a scale that invariably involves subjective judgment.

We need to move to contracting about the future with these individuals. We need to help them get crystal clear on what it is they are expected to do. We tell them exactly how we will evaluate whether or not they accomplish the things they contract to do. And finally, we need to make sure that they get the data on these metrics directly from the automated business applications that we both use to do our work.

For the organizations that do this, magic happens. Most people want to do well. Most people want to contribute to the organization for which they work. Most people, when they get regular independent feedback on how they’re doing, will take steps to correct their performance when they go off track. The best of them will strive to exceed their contracted delivery levels

That’s the essence of performance contracting for excellence. It is also the basis of effective boss – direct report coaching. Together, these two are the key to engaging people in the workplace. That engagement is, and will be ever more crucial, in the current and coming competition for skills and talent.

Let us as managers demonstrate to the people who work for us that we can do what we expect them to do: listen to feedback. Let us take what we’ve been hearing on employee satisfaction survey after employee satisfaction survey seriously. Let’s start shaping the future, and stop appraising the past. Commit yourself to performance contracting with your direct reports.

Here are some links that will help you accomplish this.

Why Performance Contracting?

C-Level Performance Contracting: Getting It Done (A How To Guide)

Both are short voice over presentations that run in a browser over the Internet.

“Shape the Future, don’t appraise the past”. ™

How do you performance contract for organization turnaround?

Organization Turnaround

Over the last two years, at executive networking sessions, I have heard hundreds of executives describe themselves as being excellent at turnaround. As I listened, I realized that they were describing their process improvement skills, not their corporate turnaround abilities. They were talking about fixing up part of the whole, not turning around the whole organization when it was under threat.

One morning, as I was driving, I hear a professional house renovator – a “re-newer”  - describe he what did. He took care to distinguish what he did from folks who called themselves “renovators” but were really “part of a house” fixer-uppers.

“When I renovate a place, the only things that will stay the same about the house are its external structure and its internal supporting walls. I pretty well gut everything else. When I am through, it’s a very different place to live in. It is a much more effective and efficient house. It operates better as a home, and costs much less to run. It usually looks better from the outside as well, although everyone can still see that it is the same house.”

What an insight!  I immediately understood the difference between all those executives I have been listening to and corporate turnaround experts.

Process Improvers	Organization Renovators
Make improvements to 1 or more existing processes through improving automation or re-organizing work flow.	Address what needs to happen to ensure this organization survives and dramatically improves its results. Figure out how to do it without destroying the organization (i.e. without tearing down “external and internal supporting walls” = destroying customer relationships or financial viability) while change is occurring.
Fit improvement into the “day to day” normal way of doing the other work in organization.	Tackle all processes in the organization and re-do them to achieve dramatic success.Do so a way that ensures that organization survives while whole scale internal change is on-going (i.e. the organization continues to serve customers, to provide services or make products, to pay its bills etc).
Help existing staff learn new improved processes	Challenge existing staff to come up to the new performance bench marks. Train them to do so if they are willing and if they can.  If they don’t, bring in people who do and fully integrate them into the team.
Fit the new ways of doing things into the existing culture of the organization.	Re-shape the culture, energizing the people. Get them to believe in their own personal future with the organization. More them from “react and get along” to “pro-act, create, provide services at extraordinary levels, achieve extraordinary results.

The metrics that are used in contracting with an executive for the improvement of existing process are straight forward. Processes do something. They produce output of some kind (e.g. service transactions, produces, units of information ….). They take energy to do (e.g. people hours, head count, …).

To develop a process improvement metric, all you have to do is count the output and the input reliably. Put units of output over units of input and you have a useful “point in time” metric for that process.  Add a relevant time period (e.g. days, or weeks, or months). Then watch the trend over time. When you do so, you have a clean, clear performance metric. Here are some classic examples:

• bank customers served per month / teller hours per month,

• airline passenger miles per month / air crew hours per month,

• Widgets produced per day / manufacturing staff hours per day.

Trend metrics such as these will tell you if the executive is “improving” the process.

You cannot take this approach when you contract with an organization renovation leader, and his or her team. Every process inside the organization will be different by the time they through, just like the entire interior a house will be different by the time house renovators are through.

Renovating an organization involves great urgency to make wide-ranging change under continuous conditions of organizational stress. Sometimes, part of the change goes backward for a time, in order for the whole change to go forward. (See The Reality of Enterprise Turnaround for more insight into these dynamics.)

So how do you “measure” the performance success of an organization renovation leader and team?  You need to take a much broader approach to metrics than when you are contracting for process improvement.

1. Use metrics that look at the whole organization from the outside in.

An example is “$revenue produced / $dollar of operating expense” per month. Watch the trend. A downward slip for a month or two is expected. But a clear downward pattern that shows no sign of turnaround is not.

All kinds of process change will be happening in an organization during renovation. However, the overall pattern of positive change will be reflected in the trends in such “from outside the organization looking in” metrics. Using a number of them is better than using just one. When you do so, you can see if the general pattern is positive, enough one or two may be on a short term downward trend as change moves forward.

Add these whole organization metric trends to a “menu” of trend metrics that focus on specific internal process. An experienced organization renovation team uses both to monitor the impact of what they are doing both on specific processes, and on the whole organization.

2. Expect the organization renovation leader and team to show how they are making both short term immediate changes and long term changes at the same time.

Listen to them as they talk about this with you on a regular basis. If they cannot show how they are doing this, then this absence is in itself a “negative metric”.

Ask for regular “review” sessions with the team. Expect the leader and the team to “insist” on having them. Expect them to initiate on the development of process specific metrics that show what is happening as a result of their changes.

An experienced organization team is profoundly metrics based. They do not believe in the “power” of their personalities as the key to change. They do expect turbulence during the change. They have an integrated approach to change that both makes sense in the longer term and adapts to short term events as they move the organization renovation forward. Just like a house renovator, they take what they uncover into account as they make change.

3. Expect negative trends in some of the process specific improvement metrics while you are seeing positive trends in others.

The turbulence experienced during an organization renovation can means that things can look worse before they look better. Just imagine what the inside of a “renovated” house looks like before house renovators start building the new walls.

4. Work with renovation team to identify the “supporting walls” for this organization – the key things that must continue to be in place while the change is happening.

Develop metrics for each one. “Revenue per customer” and “customer satisfaction / engagement “ are two examples for a customer service organization.

Watch the reaction of renovation leader and the team to any negative sustained trends in these metrics. They are about the organization’s survival. Expect them to understand the importance of these metrics, and take negative trends in these key “survival” metrics extremely seriously. They need urgent corrective action.

Turning around an entire organization is very different from turning around a specific process within an organization. But you can still develop effective performance contracts for such total change. You just need to make use that the performance metrics that you use reflect the totality of the change. You will know that you have the right turnaround leader and team when they are just as concerned about developing, monitoring and adjusting their work to a set of such metrics as you are.

“Shape The Future, don’t appraise the past.”™

Roelf Woldring (416.427.1567)

How do you use performance contracting to pick “good”, rather than “bad” organizational leaders?

“Why Are We Bad At Picking Good Leaders” is 5th on Harvey Schachter’s Toronto Globe and Mail Ten Best Business books of 2011. In it, Jeffrey Cohn and Jay Moran present the 7 characteristics that they correlate with good leaders.

1. Integrity
2. Empathy
3. Emotional Intelligence
4. Vision
5. Judgment
6. Courage
7. Passion

These qualities have been praised by many other “leadership” writers over the years. Cohen and Moran tell organizations to select for organizational leaders who demonstrate these qualities. They provide “stories” which illustrate how they believe that organizations can do so.

But all of this advice may be missing an essential point. Finding a person who is exceptional on these 7 qualities may be a next to impossible task for most organizations.

Suppose that a “good” leader needs to demonstrate possession of all 7 qualities at a level that is at least 2 standard deviations above average. Simple math will shows that the likelihood of finding, i.e. selecting, such a person is very slight.

The normal distribution graph shows that only 2.4% (=2.2% + .2%) of the population will be 2 standard deviations above average when you consider 1 characteristic. If you expect an individual to be 2 standard deviations above average on 7 qualities, you have to multiply 2.4% by itself 7 times. If you do this on your calculator or in Excel, you will get a very small number indeed. The following table shows the probability of finding a person who is 2 standard deviations above average on a progressively greater number of qualities. As you can see as you want people to have such outstanding levels on more and more qualities, the less likely you are to find them.

Let’s make it easier. Say that a good leader only needs to demonstrate these 7 qualities at a level that is 1 standard deviation above average. Even in this case, the chances of finding individuals who demonstrate most or all 7 of these qualities at this above average level are still pretty slim (2.7 people in each 1,000,000).

But we need to move beyond statistics. Cohn and Moran’s 7 qualities are not “simple” human behaviors. They are human characteristics that depend on a complex interactive mix of genetics, up-bringing, experience and education. This is the reason why years of time and millions of dollars of organizational investment in “leadership” training and development have not really produced an abundance of “effective leaders” who posses these 7 qualities at these levels.

Does this mean that most organizations might as well forget the process of “finding” or “developing” good leaders? I don’t believe so. What can an organization do find and to develop better leaders?

Organizations certainly need the succession planning processes that Cohn and Moran advocate. But organizations need to be base their decisions about individuals in such succession planning processes on an underlying performance management process that is strongly based on forward-looking, metric-based performance contracting.

An individual who consistently achieves or betters metric based performance targets over a number of years, in a variety of executive positions, is a potential future organizational leader. That person is demonstrating that she or he can apply the “right” personal characteristics to stand out from the average performer in “this” organization. Useful leadership is always demonstrated in the context of an organization’s shifting specific economic, technological, social and cultural conditions over a number of years.

The abstract “leadership characteristic” labels used by Cohn and Moran, and many other writers on leadership, tend to ignore this. Executive search consultants and academic writers turn “leadership” into an abstraction precisely because they are removed from the day-to-day performance of people in their client organizations. They do not have to deal with leadership as a concrete set of behaviours demonstrated by a specific individual that lead to valued results in a specific organization as over a significant period of time.

Executive search consultants perpetuate this tendency to relate “leading” to these kinds of highly abstract personal characteristics. It is a core assumption necessary to the continuation of their business. Unless clients believe that leadership is “transferable” from one organization to another, retained executive search for leaders from outside an organization makes no business sense.

If we approach “leading” in a less abstract way, and focus more on demonstrated “in context” performance, organizations are more likely to succeed at picking “good” leaders. Organizations that seriously want to “pick and develop” the leaders they need for the future will do the following.

1. Organizations will take care to develop their internal performance contracting competencies. They will use forward-looking performance contracts. These contracts will include a process by which boss and subordinate contract to use metrics to track subordinate progress. These metrics will derive from the automated business applications the organization uses to track and to manage the work done on a day-to-day basis.

Once such a forward looking contract is “signed” by both boss and subordinate, these metrics will be delivered independently to both boss and subordinator over the course of the performance period. As a result, the power relationship between them will shift. Bosses are more likely to become coaches when subordinate performance goes off-track. Subordinates are more likely to “ask” for help when they see that they are under achieving.

This performance contracting and progress monitoring process will be in place for at least the “manager of others” levels and above in the organization.

2. The senior most executives in such organizations will systematically review actual performance on such performance contracts to identify top performers: – individuals who consistently achieve and deliver at or beyond their contracted performance metrics.

3. These organizations will promote such top performing individuals so that over the years their job scope becomes more complex and wide ranging. As a result, maintaining “top performance” status will become harder and harder over time. This will refine the identification of potential leaders based on actual performance, not personal loyalty or personality fit between boss and subordinate.

4. These organizations will “move” such top performing individuals to a variety of assignments over the course of their career. This will allow the organization to see if their ability to deliver at or beyond contracted performance levels remains consistent in a variety of organization environments (functional, operational and geographic).

”Picking good leaders” in this way will take commitment over a number of years. The performance contracts for the CEO and the CEO’s immediate reports will consistently require the presence of metrics that “show” that this is being well done.

Organizations that do this will not be “bad” at picking good leaders. Instead, they will be shaping their futures in way that increase their probability of long lasting competitive success over a number of executive generations.

“Shape The Future, don’t appraise the past.”™