A Curveball for the Bell Curve

May 042012
 

We all know what a bell curve looks like. Many of us also use it when we make decisions. We expect, for instance, that a group of students will be made up of a few geniuses, a few dunces and a lot of pretty average folks who fall in the middle.

But maybe you can’t take that to the bank—or at least not to the office. When it comes to talent or productivity, people often don’t distribute themselves on a bell curve. There are simply superstars and everybody else.

“Rather than describe how humans perform, the bell curve may actually be constraining how people perform,” National Public Radio declared this week, as it reported on the findings of researchers Ernest O’Boyle Jr., of Longwood University’s College of Business and Economics, and Herman Aguinis at Indiana University’s Kelley School of Business.

In their study of productivity in 198 groups of people “ranging from physics professors and Grammy nominees to cricketers and swimming champions,” they found that superstars accounted for most of the success of the group. “The vast majority of the others in the group,” Aguinis explained, “were actually performing below the mathematical average.”

It’s a variation of the Pareto principle, or the 80/20 rule. Peter Drucker wrote about this often, and he observed that measurable phenomena in nature (height of people, temperatures during the year, etc.) tend to distribute themselves along a “normal” bell curve.  But social phenomena, like the things we do for a living, don’t work that way.

“In a social situation a very small number of events—10% to 20% at most—account for 90 percent of all results,” Drucker wrote in On the Profession of Management. “A handful of customers out of many thousands produce the bulk of the orders; a handful of products out of hundreds of items in the line produce the bulk of the volume; and so on. This is true of markets, end uses and distributive channels. It is equally true of sales efforts.”

Image credit: Tang Yau Hoong

There are many implications to this. One, as we’ve pointed out before, is that you should focus on making your stars into superstars, not on making the other 80% better. But another could be that most workers are neither superstars nor cut out to be superstars, and any manager must take that into account when hiring and promoting.

Neither businesses nor service institutions can “depend on superstars to staff their managerial and executive positions,” Drucker wrote in People and Performance. “If . . . we cannot organize the task so that it will be done on a satisfactory level by people who only try hard, it cannot be done at all.”

Does the idea that there are only superstars and below-average players change the way that your organization should be managed—and, if so, how?

I Work Next To You. We Should Talk Sometime.

May 022012
 

What do you think, Fred?  Fred?? Fred??

Oh, Fred’s wearing headphones and can’t hear me. This scenario, it seems, is increasingly common in the workplace today. Writing recently for Harvard Business Review, former entertainment executive Anne Kreamer says that today’s brand of technology in the workplace, particularly things like G-chat or headphones or Skype, is connecting us plenty—just not to our colleagues.

Kreamer notes that she consulted a dozen people under 35 and found that most of them wear headphones at work and that nearly all of them have a G-chat window open. “The majority of these young workers said that they felt far more connected moment to moment with people outside their workplaces than with any co-workers,” she writes. The problem, according to Kreamer, is that they miss out on crucial exchanges, become less loyal to the company and one another, and innovate less. As studies on innovation show, physical proximity matters.

Peter Drucker didn’t have to contend with G-chat, but he already saw that creating a productive workplace requires sufficient human contact. For one thing, it’s the reason many people go to work at all. “Work is for most people the one bond outside of their own family—and often more important than the family,” Drucker observed in People and Performance. “The work place becomes their community, their social club, their escape from loneliness.”

Image source: 3dSolutions

More important, such contact influences productivity, and creating satisfying informal work arrangements among co-workers is especially important for good output. Research conducted by General Motors during the 1940s, for example found that “‘good fellowship’ or ‘good relations with fellow workers’ showed as the leading causes of job satisfaction,” Drucker recalled.

But even back then, Drucker added, technology was already intruding on these important connections. “The member’s need for integration with the group, for this relationship to the community of his fellows, is not at present sufficiently satisfied,” Drucker wrote in his 1950 book The New Society. In fact, “mass-production technology tends to isolate man from man.”

Are you seeing more headphones and the like in your office? Is it good or bad for business?

Lin-sights From Peter Drucker

Feb 292012
 

Rick Wartzman

In his latest column for Bloomberg Businessweek online, Drucker Institute Executive Director Rick Wartzman writes that even Peter Drucker would have been swept up by the phenomenon of New York Knicks bench-warmer-turned-global-sensation Jeremy Lin.

“That’s because ‘Linsanity’ offers some valuable lessons on managing information, innovation (or should I say, ‘lin-formaton’ and ‘lin-novation’?) and more,” Wartzman explains. Among them:

  1. Question assumptions.
  2. Make sure the person you hire fits the job at hand.
  3. Exploit changes in perception.
  4. Fix bad habits.
  5. Put the team first.

Elaborating on the last point, Wartzman asserts: “Lin has demonstrated another trait . . . that has immediately made him into a leader—indeed, the leader—of the Knicks: Time and again, he has tried to redirect the tremendous praise coming his way to his team and his teammates. Great leaders ‘think of the needs and the opportunities of the organization,’ Drucker wrote, ‘before they think of their own needs and opportunities.’”

“In a word,” Wartzman adds, “they display ‘lin-tegrity.’”

Trust Me

Feb 102012
 

In this episode of “Drucker on the Dial”, host Phalana Tiller talks with author Ron Ashkenas about his recent HBR blog “Learn to Trust Your Gut” and his book Simply Effective. She also interviews neuroeconomist, and Drucker Exchange contributor, Paul Zak about his research with the brain chemical oxytocin and his new book The Moral Molecule. The conversations explore how instincts and brain chemistry intersect with trust and organizational behavior.

And Bloomberg Businessweek online columnist Rick Wartzman delivers a piece on how Starbucks is balancing continuity and change.

Prospects + Progress = Prosperity

Jan 132012
 

In this episode of “Drucker on the Dial”, host Phalana Tiller talks with author George Anders about his new book, The Rare Find: Spotting Exceptional Talent Before Everyone Else. She also interviews Teresa Amabile, Harvard Business School professor and co-author of The Progress Principle: Using Small Wins to Ignite Joy, Engagement and Creativity at Work. Tiller and her guests discuss how to find great talent for your team and how to grow that talent into something even more exceptional.

And Bloomberg Businessweek online columnist Rick Wartzman delivers a piece on designing the right employee-training programs.

When It’s Fourth and Long—Again and Again

Jan 092012
 

Even if you don’t follow the National Football League, it was hard not to appreciate the moment. Yesterday, in 11 seconds, the shortest overtime in NFL history, Denver Broncos quarterback Tim Tebow “hit wide receiver Demaryius Thomas for an electrifying 80-yard touchdown,” as AP put it, against the Pittsburgh Steelers. Game over.

Now, we here at the Drucker Exchange have already weighed in on what will surely be an eternal debate over Tebow’s skills (or lack thereof), and, in that regard, we’ve noted that Peter Drucker advocated building on strengths so as to make weaknesses irrelevant. But what about plain old mediocrity?

Last week, a piece in Grantland by the columnist Carles explored football fans’ fascination with NFL quarterbacks “whose names are synonymous with ineptitude” (Tyler Palko, Rex Grossman, etc., etc.). And he suggested, provocatively, that we scrutinize them as a “subconscious coping mechanism to process our own identity in the workplace.”

“As ‘great’ as we all might think we are, we probably have more in common with a mediocre NFL quarterback than with any other athlete,” Carles asserted. “The most intense forms of competition, stress, conflict and insecurity that most of us will ever feel take place at work. We embrace mediocrity as a safety net to alleviate our minds from these uncomfortable thoughts.”

Ultimately, Carles recommended, slightly tongue-in-cheek, that we accept that we’re mediocre and try to make the best of it. It probably won’t surprise you that Drucker believed otherwise. 

“Mediocre knowledge work, as a rule, is not worth having,” Drucker declared in Technology, Management, and Society. And he felt it was far better to have one first-rate knowledge worker than a few second-rate ones. “Three mediocre people produce nothing at all—they only get in each other’s way.”

And, as we’ve touched on before, Drucker saw mediocrity as an easy trap. “The first requirement of organizational health is a high demand on performance,” he wrote in Management: Tasks, Responsibilities, Practices.

Drucker was quick to point out that “performance is not hitting the bull’s-eye with every shot.” Mistakes and failures are to be expected—and learned from. And yet “the person who consistently renders poor or mediocre performance should be removed from the job for his or her own good. People who find themselves in a job that exceeds their capacities are frustrated, harassed, anxiety-ridden people.” Keeping them on, said Drucker, is “cowardice rather than compassion.”

How do you fight mediocrity in your workplace? 

Joe’s Journal: Taking the Danger Out of Dangerous Liaisons

Dec 202011
 

“While their failure rate in early years is no higher than that of new ventures, alliances tend to get into serious trouble—sometimes fatal—when they succeed. Often when an alliance does well, it becomes apparent that the goals and objectives of the partners are not compatible. The problems can be anticipated and largely prevented by following five rules:

  • Before the alliance is completed, all parties must think through their objectives and the objectives of the ‘child.’
  • Equally important is advance agreement on how the joint enterprise should be run. 
  • Next, there has to be careful thinking about who will manage the alliance. 
  • Each partner needs to make provisions in its own structure for the relationship to the joint enterprise and the other partners. The best way, especially in a large organization, is to entrust all such ‘dangerous liaisons’ to one senior executive.
  • Finally, there has to be prior agreement on how to resolve disagreements. The best way is to agree, in advance of any dispute, on an arbitrator whom all sides know and respect and whose verdict will be accepted as final by all of them.”

– Peter F. Drucker

In the 1990s, it became evident to me that improvements in information processing would lead organizations increasingly to rely on alliances and networks.

Among those from whom I gained much insight in this area is Karen L. Higgins, who ran the Naval Air Warfare Center Weapons Division in China Lake, California. She had just completed her dissertation at the Drucker School, which involved a study of 23 inter-organizational teams at Texas Instruments.

These teams were made up of members from multiple partner organizations, each contributing their expertise to a common project. The most successful among them provided lessons for executives engaged in managing alliances—lessons consistent with Peter Drucker’s rules. For instance, each organization in the alliance identified an executive who would be in charge, and he or she was empowered to manage the alliance exclusively to achieve its goals.

In addition, team-building exercises were conducted to promote complete understanding of the goals of the alliance. Clear responsibilities were established for each participant, and a procedure was established for dissolving the alliance once its goals were met.

Whenever conflicts occurred between participants in different organizations and a team member went to the executive in charge of the alliance in his organization, he often got the shocking response: “We do not want to hear this. You work it out because we are all working together.”

That is the true measure of an effective alliance.

–Joe Maciariello

 

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