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Tuesday
May122015

F.O.R.M. - How Exceptional Companies Unleash ‘Profitable Creativity’

This article first appeared in Fast Company                 

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 Photo: Flickr User Alex Medvick 

"Capital is Being Superseded by Creativity and the Ability to Innovate." 

 -  Klaus Schwab, Founder of the World Economic Forum

In today’s ‘Creative Economy’, businesses have two choices. Disrupt. Or be disrupted. There is no middle ground. 

Which explains why at the center of every successful company sits a relentlessly creative heart. 

But, it’s not enough to simply amass creative thinking as a core competency. Your company must be able to turn that thinking into solutions. Solutions that generate economic value, at scale and over time.

Exceptional companies do this every day. They unlock what I describe as, ‘Profitable Creativity’  - the ability to apply creative thinking to drive better results. 

For these companies, the result is a limitless supply of innovative products and services that satisfy and often lead customer needs. 

F.O.R.M. - An Operating System that Maximizes Profitable Creativity

In my work as an advisor and coach to some of the world’s most innovative businesses I’ve recognized that, whether by design or instinct, companies that produce ‘Profitable Creativity‘ are built on an identical set of organizing principles. Together, they effectively act as an organizational operating system. 

I call this operating system F.O.R.M. 

Fully implemented, it makes ‘Profitable Creativity’ as reliable as electricity.

I’ve studied these principles at work at over at 50 companies, and developed F.O.R.M. as a comprehensive diagnostic. It’s presented here as an actionable process you can quickly perform yourself. 

Defining F.O.R.M. 

The four principles of F.O.R.M. are connected to each other in a specific sequence. Once operational, the system continuously encourages the organization to challenge its own beliefs and behaviors to ensure its enduring relevance.

Focus: Where are we going? Why do we exist? What is our vision? Who will care?  

Organization: How should we organize? Does our structure support our vision? Do we engender collaboration? Are we moving at the right speed?

Resources: Who are the right people? Are we attracting and retaining them? Do we partner with the right companies? Are we developing modern leaders?

Measurements:  What are we doing and why are we doing it? Are we meeting our goals? Are we becoming more or less relevant?

Calculating F.O.R.M. Scores

Creativity is both an art and a science - a blend of instinct and mechanics.  

The four principles of F.O.R.M., therefore, are each built on two metrics - one emotional, one practical. These eight sets of metrics determine an organization’s F.O.R.M. Score. 

Here, we have simplified each metric into a single question. Answer all eight honestly, and you’ll immediately start to identify where you need to prioritize your organization’s energy.

We’ve applied these measurements to over 50 companies. The results are consistent.

Companies with the highest F.O.R.M. scores:

  • Rank higher on lists of innovative companies and leaders
  • Appear higher on the list of places the most talented people want to work
  • Receive a higher number of awards within their respective industries
  • Show up more frequently on “Best Places to Work” lists
  • And, in those cases where we can compare financial data, generate more revenue at higher margins on a per person basis. 

F.O.R.M. Score Categories

Based on their F.O.R.M. scores, companies fall into five distinct groupings. 

From high to low they are:

  • ‘Game Changers’ - Changing industries and expectations
  • ‘Movers’ - Heading towards the future with confidence and conviction
  • ‘Maybes’ - Some progressive foundations - some old habits
  • ‘Stuck’ - A little progress - but many behaviors rooted in the past
  • ‘Dying’ - In immediate need of life support  

The Foundations of F.O.R.M. 

Focus

Every exceptional company is driven by a vivid picture of a successful future. This is usually translated into a statement of Purpose or a Mission. We like to ask our clients, ‘What is Your Why?’

The surest way to tell whether your business has a meaningful Why is to develop a ‘company obituary.’ If your business disappeared tomorrow, who would care? What would they say?

If you can articulate, clearly and simply, why your company exists and why it matters to customers, its death will cause wailing and rending of garments. Otherwise, your obituary will be a footnote on an industry trade blog. 

Question 1.  Focus - Emotional Metric: ‘Is Your Company’s Mission Inspirational’ 

Elon Musk, the founder of Tesla and Spacex, said, “I don't create companies for the sake of creating companies, but to get things done.”  His willingness to challenge his organizations with big and important problems attracts talent and tenacity in equal measure. Both are fundamental requirements for sustainable Profitable Creativity.

Key InspirationTest: Get your senior team together and write your own company obituary. Then decide who, other than your staff, would mourn its loss a week from now? If the honest answer is almost no one, you need to redefine your company’s Purpose.

Question 2. Focus - Practical Metric: ‘Does The Company Create Change?’

Inspiration is a limited resource. After the initial noise dies down, if your company isn’t producing positive change in people’s lives, they will vacate their seats and find someone else to follow. If you do, they’ll stay to see what’s next. 

Change sets the innovation bar higher and raises standards for everyone. It also forces you to constantly recheck your own Why. Far better that you decide how you will disrupt your own future before someone else disrupts yours.

Google’s Mission is, “to organize all the world’s data and make it useful.” Google Maps is just one example of that Mission producing changes in both behavior and expectations for customers and staff alike.

Key Change Test: Other than your employees, list all of the ways your company has improved people’s lives in the last year. These need not be world changing. But they need to be genuine.

Organization

Profitable Creativity depends not on moments of individual brilliance, but on your ability to create an environment in which brilliant people can willingly and enthusiastically collaborate.

Ed Catmull, founder and CEO of Pixar said, “Getting the team right is the necessary precursor to getting the ideas right. It is easy to say you want talented people, and you do, but the way those people interact with one another is the real key.” 

Question 3. Organization - Emotional Metric:  ‘Does The Company Engender Trust?’

Trust, according to Dana Anderson, the CMO of Mondelez, is the foundation on which collaboration is built. 

Trust is dramatically deepened when leaders commit to an ‘idea democracy‘ - an environment in which every idea is owned by everyone. This encourages thoughts to be shared quickly, debated openly and accepted or discarded regardless of their creator’s rank or title.  

72andSunny, one of Fast Company’s most Innovative Companies in 2015, is rigorous in its commitment to an idea democracy. In any brainstorm, once an idea is offered, it will be enthusiastically and openly discussed and debated. But at no point thereafter will you hear any reference to its originator. Rather than making its staff protective of their thinking, the practice promotes trust in the process and each other. The result is an increase in the volume of ideas and freedom in the debate that follows. 

Key Trust Test: Who would oppose an idea democracy in your organization?   

Question 4. Organization - Practical Metric:  ‘Does The Organization Produce Collaboration?’

Creativity that is as reliable as electricity is built not on the inspiration of one or two exceptionally talented individuals, but on the minds of many. Today, disruptive businesses combine the skills of multiple disciplines in real time. Technology, entertainment, media and communications, fashion - all require organizations that combine diverse talents to produce valuable innovations. 

Zappos is one of the first companies in the world to redesign its organization around a new management practice called ‘Holocracy’ - a philosophy that takes advantage of the ability of human beings to recognize inefficiency and system errors, by placing them within an organizational structure that allows them to take responsibility for fixing them.  In a traditional bureaucracy, layers of management create a virtually impassable maze for suggestions to make it from the bottom to the top. A ‘Holocracy’ takes “just-in-time” management and extends it both vertically and horizontally across the entire organization.

Key Collaboration Tests: Do your management practices give power to groups or individuals? Do your management systems openly share real-time information from all areas of the organization, so that individual pieces of data become institutional knowledge?

Resources

Given the volatility of today’s disruptive industries, companies that produce Profitable Creativity need to attract and integrate a wider range of skilled practitioners then ever before, and do so in a highly competitive environment. Success depends on two criteria.   

Question 5. Resources - Emotional Metric: ‘Does The Company Offer Aspirational Opportunities?’

Whether appealing to talent inside or outside your company, you must satisfy the needs of two rapidly growing talent pools. Gen Y and Gen Z. These are groups who want to make one thing more than any other - a difference. If the next position you can offer them on their career path isn’t important - or worse, isn’t interesting - your schedule will rapidly fill with exit interviews.

Warby Parker, the revolutionary eyewear company, routinely hires Ivy League graduates to staff their call center who turn down more lucrative entry-level jobs to answer phones. Because the business emphasizes sophisticated customer service that demands staff that can think on their feet, candidates are drawn to the immediate impact of the role. The organization is also quick to promote out of these positions, creating both a pathway and a narrative with which to attract others.

Key Aspiration Test: Which jobs inside your organization would you personally not do? What can you change to turn that into an empty list?

Question 6. Resources - Practical Metric:  ‘Does The Organization Allow Talent to Maximize Their Personal Contribution?’

There is little point designing a dynamic, multi-disciplinary structure filled with exceptionally talented people if your management team then insist on micro-managing their behavior. If you’re clear about your business’s focus and the problems you’re trying to solve for your customers, you shine a spotlight on the paths to success. This lets managers point rather than lead, which unleashes both original thought and speed of action. 

“Responsible people thrive on freedom and are worthy of freedom. Our model is to increase employee freedom as we grow rather than limit it.”   Reed Hastings, founder of Netflix.

Key Personal Contribution Tests: What decisions would you fire someone for making without leadership approval? How can you cut that list in half?

Measurements

To unlock Profitable Creativity you have to have real-time access to the financial numbers, and someone who can tell you the story behind them. But, when companies ignore the human criteria that affect performance, they place profit over people. In a talent driven business, the only disruption that causes is to your longevity. 

Question 7. 

Measurements - Emotional Metric:  ‘Does The Company Have Meaningful Values?’

A lot of companies talk about values, but few embed them into the organization’s day to day behavior. This half-hearted approach creates inconsistent decision-making, particularly under times of duress. Talented people want to know the rules of the journey, and they want to see everyone playing by them. Embedded values provide the discipline. Take that fabric away and you reduce trust, confidence and engagement - all pre-requisites for Profitable Creativity.

Aravind Melligeri, CEO of Aequs, a highly innovative aerospace manufacturing business, recently made part of his senior management team’s compensation dependent on strengthening their employees’ commitment to the company’s values. Aequs now benchmarks internal values every 6 months and runs internal workshops to bring each value to life.

Key Values Test: Ask six people to send you a list of the company’s values. Are they the same?

Question 8. Measurements - Practical Metric:  ‘Does The Organization Know Which Numbers Are Important To Its Success?’

Companies need to measure progress across multiple criteria, because the obvious ones - revenue and margin - are a consequence of other stories. For instance, for any company dependent on creative thinking, high employee engagement is crucial.  Once you’ve determined your key metrics, build a management dashboard that provides these numbers in real-time. In a world moving at social speed, if you’re still moving at enterprise speed you’re going to be the disrupted, not the disruptor.

Andrew Benett, Global CEO of Havas Creative Group, has implemented an employee engagement metric and tied it to senior executives’ bonuses. Each executive must create a five-point increase in employee engagement within their team over 12 months to receive a bonus. If, as in Havas’ case, 75 percent of your costs are in talent, putting a number to their level of engagement in your business is a direct path to Profitable Creativity.

Key Numbers Test: Which three metrics are most critical to improving your revenue and profitability? How many people in your organization agree with you?

 

In any successful company, you will find some of the organizing principles of F.O.R.M.. But only exceptional businesses exhibit them all.

Institutionalizing all four unleashes Profitable Creativity and turns any business from disrupted into disruptor. 

None require capital. Only imagination and determination.

Essential characteristics for any modern leader.

Monday
May042015

Why 'Profitable Creativity' is the Fuel of the Creative Economy


"Capital is being superseded by creativity and the ability to innovate." 

 -  Klaus Schwab, Founder of the World Economic Forum

I came across this quote recently and it resonated so powerfully that I put it on our website.

And though it can be debated whether money or ideas come first in the hierarchy of building blocks on which businesses are built, there is no longer any question that you must have both in order to create sustainable competitive advantage.

Because today, there are only two business realities. 

Disrupt. Or be disrupted.

Today, exceptional companies have to do more than simply meet a known need. They have to be capable of seeing the world differently.

If you look at the companies on the list of the world’s most valuable brands you’ll see an interesting trend. Only three - Coca-Cola, McDonald’s and Wal-Mart - exist to satisfy the bottom layer of Maslow’s hierarchy of needs: food; water; warmth and rest. 

In other words, we’ve moved a long way past worrying about the present. Today, our energy and our money is drawn towards companies that are focused on redefining the future, rather than satisfying basic human needs.

Indeed, of the top 20 most valuable brands, nine are defined as ‘technology’ businesses,  four are automotive (an industry at the epicenter of technological disruption), and two - GE and AT&T - are full-time residents of the innovation school of growth.

When where we’re going is more compelling than where we are, then the ability to innovate becomes not just a valuable business capability but a prerequisite to success. And creativity - the  fuel that drives innovation - becomes an essential resource.

These are the building blocks of what is increasingly being described as, ‘The Creative Economy.’

In this environment,  companies must do two things to succeed. Find a supply of creativity that is as reliable as electricity. And then apply it to solving problems that have value to today’s consumers.

Companies that do this, produce what I call, ‘Profitable Creativity.’ 

They also produce less bureaucracy and more empowerment; fewer rules and more exploration. They collaborate at their core, ideate and iterate rapidly and possess a greater tolerance for risk.

They are built, not by accident, but by design. 

And they fill the conversations of consumers who care less about a company’s how and how much and much more about its why.

Companies like Apple, Netflix, Warby-Parker, Uber, Starbucks, Pixar, 72andSunny and Refinery29.

They are built and run by leaders who are more interested in disrupting than being disrupted. Leaders who relentlessly seek new sources of creativity, new practices that unlock it, and new ways to apply it to solving problems that have value.

These are the companies of the Creative Economy.

We’re going to spend time over the next few months writing about how to recognize these busineses, what makes them tick, and how you can apply their lessons to your business. Original articles will first appear at Fast Company, and then reposted here, supplemented from time to time with additional thoughts and analysis.

I’m going to be joined in this by the well-known ethnographer, Sudhir Venkatesh. Together, we’ll be exploring the dynamics that determine what makes these companies and their leaders disruptive and successful.

We hope you’ll join us and give us your thoughts and insights as we take this journey.

Saturday
Feb142015

Five Forces That Power Exceptionally Creative Companies

This article first appeard in Fast Company.

Unlocking creativity as a fuel source for any business is a holistic endeavor that requires the skill of a chemist.

Balancing and re-balancing the demands of running a successful and reliable enterprise against the need to explore the unknown is no longer a matter of predictable process. Today, successfully managing a company in a disruptive industry is dependent upon the leader’s ability to tap into the natural energy sources that flow within most organizations.

In my work as a coach and confidant to leaders of some of the world’s most creative companies, I have identified the five forces that power the very best. These are the forces that produce "Profitable Creativity."

Image: Flickr user Kristin Shoemaker

GRAVITY

The best companies are attracting talent faster than they are losing it. Given that some of their competitors have a retention rate of less than 60%, this creates immediate competitive advantage. A recent article by the Management Innovation eXchange reports that today’s workforce has never been more mobile (35% prefer to be self-employed), fluid (those entering the workforce today are expected to have 10 career changes before the age of 40) or disinterested (87% of workers worldwide say they are disengaged at work).

In this environment, a company can not hope to tie its best thinkers in place for 20 years. It must attract and retain talent gravitationally.

RESTORING GRAVITY

Gravity is present within every business at startup. It is the force that draws together enthusiasm, determination, and the ability to solve new problems with original thought. Over time, that energy dissipates and many companies are left in a state of weightlessness, searching for relevance and focus.

Restoring gravity is the result of Asking Hard Questions, starting with:

  • Why does this company exist?
  • Why anyone should care?

This provides you with focus and a definition of the problem your company is in business to solve.

Talented people want to make one thing above all else. A difference. And companies like Google are winning the talent wars because they offer the opportunity to do so. "Organizing the world's information and making it universally accessible," is not just a website mission statement. It is a gravitational imperative for tens of thousand of people. What’s yours?

MAINTAINING GRAVITY

Gravity is a fickle force. One day you feel safely anchored to a rock-like set of beliefs. The next, you are floating in space, wondering what happened to yesterday’s truths.

A busy company is not necessarily a successful or a sustainable business. And being clear about whether your point-of-differentiation is still different, is crucial to maintaining gravity.

Vince Barabba, describes three company types in his book The Decision Loom.

  • Make-and-sell 
  • Sense-and-respond
  • Anticipate-and-lead

In my experience, companies in the first group are in the commodity business. And gravity is at its weakest in that environment. The leader’s job is to constantly be looking for ways to move higher in the gravitational food chain. This requires a Willingness to Thrill Your Customers.

As Henry Ford once said, "If I had asked my customers what they wanted, they would have said a faster horse." His willingness to look beyond his customers’ wants to their needs created decades-long gravity.

Image: Flickr user Larry Jacobsen

TENSION

Many organizations wisely shy away from "paralysis by analysis." But even more avoid healthy debate in exchange for easy answers. Unlocking original thought requires a willingness to let originality emerge from the shadows.

Tension is at the heart of every business that depends on creativity. And yet, many leaders spend time and energy searching for ways to reduce its presence. This is a self-destructive quest, because lowering tension requires you remove the stimulus that creates the best answers in eight crucial debates:

  • the individual vs. the organization 
  • now vs. later
  • freedom vs. structure
  • fashion vs. sustainability 
  • culture vs. values 
  • evolution vs. revolution 
  • pushing vs. leading
  • waiting vs. starting

In every case the first proposition is immediately tempting—which doesn’t automatically make it wrong. The best answer in each debate is driven by context, specifically the question: :where are we headed."

But there is never a black and white choice, and relentless willingness to embrace the tension of opposing views is necessary to ensure that what you’re getting is the best, not the quietest or easiest, solution.

EMBRACING TENSION

Tension is the partner of consequence. And when the result of an opportunity or investment is less than expected, the cause is usually a failure to explore the other possibilities in the planning stage with enough determination.

Creating healthy tension requires Starting With Clear Definitions of Success. This ensures that attention is placed on improving outcome, not leaning on philosophically-driven answers. The result is a greater collective willingness to engage the debate.

Warby Parker, the extraordinary eyewear company, pays close attention to its Net Promoter Score—a measurement of customer satisfaction. This focus on the consequence of each decision encourages debate and avoids easy answers that can be quickly rendered irrelevant by a rapidly changing marketplace—or world.

MAINTAINING TENSION

Tension requires seeing that there are at least two sides to every story - a trait that traditional leadership struggles to embrace. Confident leaders push for the opposing point of view secure in the knowledge that being wrong is not a mark of weakness but a sign of strength.

At an organizational level this is amplified in an environment in which "Idea Ownership" is Replaced by "Idea Improvement."

At agency 72andSunny, ideas of any kind become the immediate property of the group engaged in solving a problem. The result is that every suggestion can be debated rigorously without offending sensibilities or feelings. This encourages all possibilities onto the table, and focuses the tension on the outcome not the origin.

Image: Flickr user Kevin Dooley

HEAT

One of the characteristics that sets apart exceptionally creative companies is the ability to rapidly take an idea from inspiration to fully formed expression. They keep each part of the organization simmering, their people engaged and focused. The result is that it doesn’t take long to bring ideas to the boil.

Heat is also an essential but potentially dangerous change agent. Turn it up quickly and the consequences can be catastrophic. Apply it slowly and its impact is barely noticed until it has created the pliability you’re looking for. Exceptional leaders use it judiciously, knowing that a little goes a long way.

APPLYING HEAT

Heat is at its most effective when applied consistently. This condition is naturally created when the organization has defined standards. This creates two sources of heat. Top-down and middle out. Top-down heat is management directed and has been applied by businesses since the Industrial Age. But, the creative economy that we are now entering requires different management approaches to unlock the potential of today’s talent.

The millennial generation is less impressed by bureaucratic power than any group of talent that has come before. Instead, they are more influenced by the expectations of their peers. If you want to apply heat that raises both expectations and performance, you must do it through standards that are inherently built into the entire organization. The presumed authority that comes with a title is no longer enough to get the operating temperature where you need it to be for sustained, exceptional performance.

Netflix defines nine behaviors and skills the company values most. Each has at least four separate measurements. They make hiring and compensation decisions based on how well you meet those standards. "Adequate performance gets a generous severance package." Which removes the emotional resistance many managers have to letting people go. In a company striving for excellence, nothing turns down the heat like a willingness to tolerate average.

MAINTAINING HEAT

One of the most valuable sources of energy is the internal heat that comes from your staff. If you can unlock their passion it is a powerful source of renewable energy.

Talented people want to contribute. To make a difference. They want to know they have a chance to do something important. Tapping into this requires encouraging trial and error.

In large, risk adverse organizations, the most effective technique to keep heat simmering is the use of pilot programs. Small explorations staffed by one to four people with a passion for making something new happen.

Exceptional leaders look for opportunities to start these on a regular basis. If they succeed, add resources. If they don’t, you will almost certainly have learned something valuable, and your staff will be hungry for more.

Elon Musk made a billion dollars creating PayPal. Then spent it all trying to get Tesla off the ground before he succeeded, with the help of government funds. Now he’s out to commercialize space with SpaceX. In the Creative Economy, the willingness to literally reach for the stars attracts both talent and investment—two powerful sources of heat.

Image: Flickr user Steve Jurvetson

SPEED

Speed and time are inextricably linked. Which make speed the lever of creativity’s most important metric—the opportunity cost of the time spent to solve a chosen problem.

Working faster means learning more. In a creativity-driven business, that is extraordinarily valuable compensation.

Exceptionally creative businesses use time more effectively. They move no slower than entrepreneurial speed, and in some cases at social speed. When your competitors can do no better than enterprise speed, the result is greater impact of your people and sustained advantage for your company.

INCREASING SPEED 

Bureaucratic organizations are constructed with built-in inhibitors. The most obvious are those that require multiple check-points for daily processes. One company we came across required twelve people to approve a request to work with a new vendor. This included a multi-layered requisition form, completed in triplicate.

The key to increasing speed is Removing Bureaucracy from creative thinkers. This is not the same as removing rules. It does require leaders walk through a process to ensure that it satisfies common sense rules of working. If they find they would be annoyed by it, they should fix it or remove it.

One hour spent by a leader in improving process does two things. Engenders respect—from employees and vendors alike. And returns a multi-thousand-fold investment in saved manpower and increased speed. The consequence of which is exploration over hesitation. A prerequisite to unlocking creativity.

MAINTAINING SPEED

Entrepreneurial energy is a natural and renewable resource, ruthlessly squandered by most companies. Unlocked and directed, it produces dramatic increases in the speed with which a company responds and evolves. Inhibit—or worse, ignore—entrepreneurial intent and you will be faced with a groundswell of frustration and resentment.

Unlocking entrepreneurial energy requires A Commitment to Other People’s Ideas, and their right to share in the benefit. That is as much an emotional commitment as a financial or practical one—the ROI of which is almost limitless.

Lori Senecal of KBS+ has moved her company from one focused on innovation to one that delivers invention. To do so, she and her leadership team have worked to unlock entrepreneurial energy at every step of the organization, investing in capabilities that allows staff to turn ideas into prototypes, and to benefit economically if the idea has commercial value. Her stated goal is to have her staff make her obsolete—which should be the definition of success for any entrepreneur.

Image: Flickr user Aurélien Durand

GENEROSITY

Creativity requires risk. That we might fail. Or be wrong. It also requires we explore the unknown.

Overcoming these personal hurdles and making these dimly lit journeys are infinitely easier when we feel supported along the way by people and organizations we trust.

There is a straight-line link between generosity and trust. Act in someone else’s best interest, without regard for your personal situation, and they will trust you for life.

This is a high ideal. But it creates extraordinary fuel for creative thinking. 
And has two other benefits.

It is entirely within your control to provide. And costs nothing.

Dana Anderson of Mondelez recently asked an industry audience to "give until it hurts, so that we spur creativity in the people around us." She cited the example of George Meyer—one of the writers of The Simpsons—who routinely wrote jokes for episodes without attribution and asked for the hardest assignments so that his co-writers could flourish. His personal motto 'Show up, work hard, be kind and take the high road.' The writing team he created has been described as one of the finest the industry has seen.

INSTILLING GENEROSITY

Generosity requires courage because it demands that The Leader Must Take the First Step. And that step has all the risk, the most immediate of which is looking foolish. Putting ego and fear aside is a distinguishing feature of contemporary leadership, and is at the heart of instilling generosity.

The old adage says that, "a rising tide lifts all boats." Most companies accept that as true, then focus on their boat. Generous companies focus on the tide.

Elon Musk recently announced he has decided to release a number of the patents Tesla hold on their electric car technology in order to allow competitors to enter the industry and spur more rapid innovation. "We don't want to cut a path through the jungle and then lay a bunch of land mines behind us."

MAINTAINING GENEROSITY

As a practical definition, generosity means putting the needs of the organization first by making brave and sometimes personally uncomfortable decisions: a willingness to have honest conversations, including the most difficult ones: letting people go that are struggling before you know how to replace them (a service to both them and the organization); hiring people more talented than you; taking on the difficult client personally and refusing to take credit. Each of these makes life better for others and raises their ability to exceed their own expectations.

Without generosity, we are left with a zero-sum environment in which there must always be winners and losers. Susan Credle of Leo Burnett describes this as a "Culture of Scarcity." In its place, Susan advocates a Culture of Abundance—a definition that looks first to create the best outcome possible for the other party instead of protecting our own status quo.

Gravity. Tension. Heat. Speed. Generosity. Five powerful (and functionally free) sources of fuel for the leader of any company intent on increasing its capacity for creative thinking.

Tuesday
Nov112014

Maude

 

“I’ll stay 'til the wind changes.”  ~ Mary Poppins

 

Last Saturday night, the wind must have changed because our beautiful and loving and joyful Maude suddenly left us. In her wake is a cyclone of anguish and helplessness.

The wind that brought her to us blew up from the south nine years ago. Hurricane Katrina. Along the way, it picked up a terrified three month old puppy in Louisiana and dropped her into the PAWS clinic on the south side of Chicago.

Which is where we met her. Huddled and catatonically afraid in a small crate, surrounded by the organized chaos of 300 other animals rescued by PAWS that late summer from the devastation around New Orleans.

We had sold our business three months earlier and spent the final days of August watching in horror as civilization collapsed in real time on live television. Finding PAWS gave us a way to help and started a relationship that endures to this day. It also later gave us two other dogs, Fred and Summer. But those are stories for years from now - if I have anything to do with it.

Maude stole our hearts in that first moment, and never gave them back. When she left us - much too soon -on Saturday night, she took part of them with her forever. 

In truth, Maude never fully recovered from the hurricane. Found wandering the streets around New Orleans in the aftermath of Katrina, the efforts to trap her scarred her for life. Until the last of her days, the arrival of a stranger sent her into a panic, a fear hard-wired so deeply that only a handful of people made it all the way through her defenses.  

To do so gave you access to the unbridled joy that defined her when she felt safe. She didn’t run to you, she bounced. She didn’t wag her tail, she thumped it, the sound loud enough to fill a home. And whenever we returned, whether after an hour or a week, her greeting was the same; a clamor for attention then a leap onto the nearest dog bed with a bone while her tail drummed in celebration at the family being made whole again.

Maude had not been in our thoughts during that first rescue weekend. For the decade before Katrina arrived we had been a tightly knit pack of four. Chris and Charles and Harry and Maya. We were a unit and not much inclined to upset the status quo. 

But I have learned that the status quo is a fantasy, no matter how much we might wish to freeze our life in certain moments. And now I am drawn to change through conscious choice, for the present is always beyond our control. It is only the future we can seek to influence.

And so, when I came across Maude, wide-eyed with terror as she looked up at me through the bars of that crate, it was instantly obvious that the status quo had just left the building. Chris walked over and stood beside me. “I think she really needs our help,” I said gently. Chris nodded and all of our lives changed forever.

In the first few days at PAWS, Maude was almost rigid with fear. The first signs of life came when I fed her peanut butter from a jar, her little white beard becoming sticky in her attempts to navigate the spoon while keeping as far away as possible.

One day she was startled by a sound and leapt off the desk I had been working on and landed with a thud. I scooped her up, terrified I had broken her. 

But as the PAWS vet looked her over I felt her lean against me for the first time. It was not yet trust. But it was a building block towards it. And that was good enough for now. Success should rarely be measured by perfection. Success should be measured by progress and then built upon with intent.

The test was whether Harry and Maya would accept her. That night, we brought her home for the first time. From the instant she arrived, Harry became her big brother and Maude his little sister. 

A few days later I took this picture.

For Harry, that spot by the front door allowed him to make sure we were protected. For Maude, it was the safest of places from which to explore her curiosity of the world. 

As we got to know her we realized that this tension between wanderlust and a yearning for safety, was central to who she was. 

In fact, Maude was a walking contradiction of opposing forces. Slowly, we came to understand that for her the cost of overcoming one brought enormous reward in another.

The fear that held her back from every stranger meant that her love, when given, was as precious as any breath.

The car-sickness that gripped her on any trip of more than ten minutes made her joy on the walks or swims that followed a spectacle worthy of Barnum or Bailey or both.

Without obstacles there is no achievement. Without tension no progress is sustainable. 

That constant tension made Maude the member of our family that every visitor sought to woo. Hundreds of hours were spent coaxing her towards outstretched hands. But only when backs were turned would she come over and decide if she was ready to let you in. 

 We are blessed that she spent nine years with us.

That she knew the joy of dog beach in Chicago and the snowy winters in Millbrook.

That her name is forever etched in an adoption room at PAWS.

She was a friend to every dog we came across.

She was a sun worshipper, and a grass roller and a lover of being chased and of tearaway, joy-unlimited puppy crazies. 

She was precious. 

She was funny 

She was extraordinary.

She is gone.

Suddenly. 

Happy and vibrant last Thursday morning. In emergency surgery Friday night. And after initially seeming to survive, she suddenly collapsed on Saturday evening and died in the car as I raced her back to the ER.

A week before, I had kneeled down to say good night to her, suddenly struck by the privilege it was to have her welcome my attention, to turn her tummy up to my touch, to paw me for more. To be her Dad. 

And when my own journey here is done, no matter what else I may accomplish, there will be nothing of which I am so proud but that I earned her trust and warranted her love.

In Maude’s lifetime she said not one word.The definition of speak softly.

But she carried the biggest of sticks. Love. Hard earned and then unrelenting.

She is gone. 

She is everywhere.

We will know it is heaven when we see her again.

 

Thursday
Jun202013

4 Weapons of Exceptional Creative Leaders

This article first appeared in Fast Company

For the leader of a company powered by creativity, the difficulties of navigating today’s complex marketplaces are compounded by the fact that, in every decision, two forces are loudly asserting their dominance.

Creativity and Profitability. A fractious relationship at the best of times.

Leading a company that must, by definition, exist in a constant state of dispute provides enough challenges to fill a book. 

But in my work as a coach and confidant to some of the world’s best, I have come to recognize that exceptional leaders unlock the power of ‘Profitable Creativity’ by developing four benevolent weapons. 

1.  Context

Context is the most under-appreciated asset of business leadership because without it, every decision becomes a guess.

But context requires you have the full picture. Which is why, well disguised guesswork is what passes for strategic decision making in many of today’s creative businesses.

Many creative companies know what they do, but not where’re they’re trying to get to. They’re on a journey, but without a clear destination.

Talented people want to make progress. Establish context and you can show them that they are. Guess, and you lose not only your own bearings, but their loyalty. 

The Power of Context

Context gives us the ability to Say No With Confidence.  

Great leaders are not necessarily braver leaders. They’re just better informed about the consequences of their choices, which makes it easier for them to make the hard ones. The result of which is they are able to keep their companies focused. 

When Steve Jobs returned to Apple in 1997 as its CEO, he began saying ‘no’ to virtually every request by Apple’s developers. He understood that saying ‘yes’ was a distraction from where he knew he needed to take the company, and having context gave him the confidence to stand by his convictions. 

Many leaders fear saying no, and see it as limiting. But more often than not, it’s the right answer when you’re clear about where you’re headed and are in a hurry to get there. 

Creating Context

Context requires that you Build From The Future Back.  Once you know where you’re headed, the decision whether to turn left or right at any given fork becomes increasingly clear.

When Reed Hastings and his partners formed Netflix in 1999, they designed the business they wanted to be in 2008, then waited nine years for the internet to catch up with their vision. Their willingness to explicitly define the future helped them attract talent interested in solving previously unimagined problems, and gave them the focus to avoid the distractions of an increasingly desperate competitor called Blockbuster.

Maintaining Context

Context is only relevant if it’s based on current information. Because the world is changing in real-time, exceptional leaders actively Welcome Disruptive Thinking.  

Howard Schultz credits much of his transformation of Starbucks with a willingness to always search for a better way, even when the company had quadrupled in value since his return. “We are turning over rocks and looking at the things that perhaps we didn’t get right and constantly beating ourselves up. If you walked into our Monday morning meeting, you would think this is a company that is still trying to transform itself.”  

Exceptional leaders instill their organizations with a constant thirst for knowledge and use it to test their own thinking. They marry this with setting a high bar for changing their mind. But when the evidence suggests they should, they do.

2.  Clearly Defined Values

Most leaders have an instinctive definition of good and bad, of right and wrong, and rely on those instincts in every situation. But exceptional leaders take time to define those values explicitly. First for themselves, and then for others. This ensures a constant point of reference for everyone, including the leader.

When talented people understand what is expected, they will usually take up the cause alongside you and apply their own talents to the challenge, secure in the knowledge that they understand the rules, and where to bend them. And you’ll have clear metrics by which to judge their contribution - and their chemistry with the organization.

The Power of Values

Clearly defined values allow you to avoid the most misunderstood aspect of building a compelling business - Over-Valuing Company Culture

In most cases when you hear a company espousing its culture, it’s inadvertently making an argument for the status quo. But culture is made up of both positive and negative attributes, and when culture becomes the sole reference both good and bad go along for the ride. 

As organizations grow, they need to adapt and evolve while maintaining their center. Culture creates boundaries. Values provide foundations. The former restrict. The latter empower.

Setting Values

Exceptional leaders establish explicit company values. And they also incorporate their values into a clearly defined Personal BrandThis gives them a compass by which to navigate the daily demands of managing organized chaos. 

A personal brand is more than the simplistic equation used by many: ‘company name + personal title’. When that relationship ends, the leader is only known for where they worked, not what they believed. 

An authentic personal brand is built on clearly articulated ‘planks’ - a series of distinctive beliefs that form an intentioned and cohesive macro-view. And the self-confidence it reflects attracts talented people as much as any bonus.

The discipline of a clearly defined personal brand also helps to overcome the habit many leaders succumb to when asked a question - the urge to be endlessly original. If you’re saying something different every time someone asks you a question, at best you’re confusing them, at worst you’re alienating them.

Maintaining Values

Values get eroded, or worse, distorted if left unattended. Maintaining them requires leaders that Address Issues Quickly

Nothing undermines values like waiting weeks or months to correct a problem. And nothing undermines creative and emotional enthusiasm like a series of inconsistently applied standards . Exceptional leaders are willing to have courageous conversations. And maintain clear standards through honest, decisive leadership.

A recent poll showed that 47% of executives in creative businesses would prefer working at a new company. 

In today’s most innovative businesses, the greatest risk of inconsistent standards is the potential loss of talented people who decide every day whether you are using their time valuably or frivolously

3.  Trust

We live in a socially connected age. Our nose for disingenuous, deceptive behavior has never been more sensitive. In that environment, establishing trust is not simply a choice but a requirement if you want to keep the best people and have them do their most courageous work.

The Power of Trust

A lot of leaders make the mistake of adding talent to an organizational structure incapable of taking advantage of new skills. 

In today’s multi-channel, consumer-driven landscape, successful companies are built by leaders who Embed Collaboration into their organizational DNA. This ensures the company is designed to integrate disparate talents and built to perform under pressure. 

Dana Anderson of Mondelez describes trust as the foundation of collaboration, and explains that collaboration is a rare commodity in organizations where idea ownership is valued over progress. 

Exceptional leaders use trust to break down personal ownership of an idea, while promoting public debate and shared exploration instead.

In the case of Mono, one of the industry’s rapidly emerging creative forces, its office is built around a central wall which acts as a public workspace. The wall establishes trust through transparency, and makes collaboration not just a philosophical initiative but a physical inevitability. 

Establishing Trust

The fuel of trust is Transparency. Exceptional leaders define it. It doesn’t mean telling all people, all things. It means being open about what you can reveal, and being open about what you can’t. 

And it means that when you’re not sure, you lean on the first part of that equation. 

Maintaining Trust

When your best people know that you’re there for them, they tend to give you the benefit of the doubt. The key is to Provide Accessibility.  

Reed Hastings doesn’t have an office. He moves around Netflix’ headquarters meeting with people at spare tables. When he does need a quiet space, he uses his watchtower, a room-size glass square built on the roof of Netflix’s main building. 

Whether you follow this virtual leadership approach, or base yourself in the corner office, walking the floor regularly and keeping the door open, both physically and emotionally, is crucial to building and maintaining trusting relationships. 

4.  Momentum

In today’s business environment, momentum is essential fuel. It takes enormous effort to create motion from a standing start, and it is much easier to change direction if you’re already moving. The most dynamic leaders make decisions fast and move on.

Innovation is the consequence of exploration. And you can’t explore while standing still.

The Power of Momentum 

If you create a one percent improvement in one area of your business today, and tomorrow do the same thing, seventy days from now that capability will be twice as good. This is known as the ability to Aggregate Marginal Gains

In 2009, a man named Dave Brailsford presented a plan to the British government to build a cycling team capable of producing Britain’s first ever winner of the Tour de France. He thought it would take four years. His plan was based on an approach he described as, “aggregating marginal gains - how small improvements can have a huge impact to the overall performance of the team.” Sir Dave, as he is now known, broke down the individual elements of a world-class cycling team and focused on improving each component piece by one percent. And his plan, which resulted in Sir Bradley Wiggins becoming the first British winner of the Tour de France, did not take four years. It took three. 

Creating Momentum

Momentum is blocked when the criteria by which decisions are made are set too high. Exceptional leaders Measure Decisions Against Success, Not Perfection. Not only does this engage their staff and create progress - a meaningful reward for talented people - it also creates a better work-life balance in the process. 

Companies die in the quest for perfection. In the meantime the organization loses the benefit of the learning that any decision provides. Great leaders stack decisions on top of each other and evaluate progress against the destination, course correcting as they go. 

Maintaining Momentum

Nothing undermines the effort and emotional investment of talented people more than allowing other members of the team to consistently under-perform. Exceptional leaders are willing to support a policy of Firing Fast, knowing that only by supporting the highest standards can they maintain the morale of talented people - and the company’s momentum. 

A recent BusinessWeek article highlighted the fact that on a typical weeknight in North America, Netflix is responsible for almost a third of the internet’s downstream traffic. That requires immense infrastructure and engineering talent, one of the most sought after talent pools in the modern world. The temptation for most leaders is to cling to scarce talent like a life raft, indulging under-performers based on their expertise not their performance. Netflix takes the opposite view, encouraging managers to provide fired employees with industry-leading severance packages, thereby removing managers’ guilt and raising standards. 

 

Context. Standards. Trust. Momentum. 

Four weapons that will give you immediate competitive advantage on the road to ‘Profitable Creativity’.

Monday
Mar182013

Eight Ways To Win The Race for Creative Talent

This article first appeared in Fast Company.

Many creative businesses limit their talent recruitment and retention strategies to money and flattery.

But companies adept at unlocking what we describe as ‘Profitable Creativity’ are built on more sustainable practices.

Many of these, I learned first-hand over a decade building a company filled with demanding, world-class talent. In that time, we lost not one of our artists to a competitor. The others I’ve experienced in my work as a confidant to some of the world’s most successful Chief Creative Officers and company owners.

In all, there are eight. And seven come with the added benefit that they cost nothing to implement.

  1. Build An Evangelical Business. Creative people yearn to make one thing more than any other. A difference. They want to solve problems they believe are important. Ten years ago, Netflix and Blockbuster were in the same business. The difference lay in their respective visions of the future of movie rentals. Internet-supplied delivery at your convenience? Or rainy Thursday nights staring at an empty shelf in a store? Which set of problems would you rather solve? Nothing attracts creative people like a clearly defined vision of a better future. And the opportunity to be part of making it come true.
  2. Avoid The Deflationary Value of Money. In Dan Pink’s excellent book, Drive, he explains that many creative people are in fact de-motivated by money. In some cases it makes them perform worse, because when a task becomes ‘work’, creative people tend to feel restricted. As a manager, focus whenever you can on highlighting the intrinsic value of solving a client’s problem. And when your company decides it must ‘do it for the money’ - an economic reality in virtually every business - be mindful of the impact this has on your most creative people.
  3. Pay Fairly. There is a time to spend money. Paying ‘below the market’ shatters trust. Many companies ignore this truth, under-paying early on when the company can - then over-paying later, in order to keep talent locked in place. This builds suspicion and destroys loyalty. Instead be relentlessly pro-active in maintaining market-parity compensation, with bonuses for extraordinary results. Desperate competitors may still try to over-pay to hire away your best people. But loyalty to you will drive the price even higher. And if occasionally your competitors succeed, they will do so only by damaging their own margins.
  4. Measure Progress. At Rosetta, one of the industry’s fastest growing interactive agencies, the rigor of the employee review program stands in stark contrast to most creative businesses. Employees are measured on a set of four published benchmarks that encourage both personal initiative and collaboration. The system is transparent and consistent. At the end of the year, everyone is evaluated and rated against their own peer group at their own level. This ensures that every employee has a clear understanding of how much progress they have made. According to a recent Harvard Business Review study, nothing matters more to talented people.
  5. Engineer Engagement. Gallup Organization research has shown that most people become less engaged with an organization over time. Nothing dilutes loyalty more than a company’s willingness to support under-performers. Be relentless about improving or firing the weakest links and raising standards and expectations. It attracts and unlocks greatness. 
  6. Invest in Individuality. Google attributes their growth to the investment they have made in requiring twenty percent of their engineer’s time be used for anything the engineer wants, so long as it makes Google a better company. Gmail, for instance, was the invention of one person in one day. Creative companies that charge by the hour can’t match this level of investment. But when you decide to invest zero in the possibility that your talent can create value in unpredictable ways, it suggests you think they are not capable of doing so.
  7. Be Open. Be Honest. Transparency is essential to attracting and retaining great talent. We define transparency as this: telling what you can, and explaining what you can’t. Sharing openly encourages your people to give you the benefit of the doubt. Critical to building loyalty.
  8. Say Thank You. The artist in all of us needs to be recognized. So does the human being. And yet most companies are slow to praise or even to thank. Which is strange since each of us makes a choice every day about where we work. It need not, after all, be here. Saying thank you at the end of every day has always seemed to me to be a small acknowledgement that you take neither their talent nor their choice for granted.

Individually, each of these practices will make an organization more empathetic. Essential fuel for unlocking Profitable Creativity.

Collectively, they will make your company irresistible to talented people. And invaluable to your customers.

They do require investment. Mostly of time and humanity.

But the ROI will exceed any expectation you think is reasonable. And most you would believe are unrealistic.

Try one today. And let us know how it works.