Insights

  • Break Down the Barriers to your Company Values
    values
    Thanks Trisha!

    I don’t need to tell you that Facebook has been dealing with a bit of a crisis. While Cambridge Analytica is closing, the remaining Whatsapp founder is leaving, the other Whatsapp founder is telling everyone to #deletefacebook, and new data regulations from Europe are spreading around the world, what does the conversation revolve around?

    Values.

     

    Facebook isn’t doing well in an age of “values-based consumers“.

    “Facebook has lost the value is relies on most” – trust.

     

    People seem to think that having values, and reflecting the values of your customers helps in this situation.

    As one PR expert said, “companies with corporate values will always outperform non-value based brands”.

    But Facebook had values! People wrote articles about Mark Zuckerberg’s new and refreshing approach to values, but the company’s internal conversations give a new meaning to “what are you willing to give up?”.

    Is it enough to just have values? Of course not, but we’ve heard that before.

     

    My collaborator Arthur and I tackle this issue here. In a nutshell, you are really following your values when you are radical about them.

    For example, radical transparency can look like sharing all of your financials as a company (freaky, I know!), radical commitment to work-life balance can look like giving employees money they must spend on vacation (woohoo!), and radical innovation can look like investing 15-20% of your employees’ time in high-risk, new projects.

     

    We’ve had some great feedback so far, and I want to go a step further. I’ve put together an exercise for diagnosing why your company isn’t aligned on your values, to avoid the kind of crises we talked about. Read through the seven barriers, their explanations and supporting characteristics, and then ask yourself:

    Are these barriers holding my company back?

     

    Contents

    1. Your organization has too many people.

    2. Your top management team doesn’t agree on the company’s values.

    3. Your organization’s decisions are slow and multi-layered.

    4. You are scared of the unknown, so you don’t take risks.

    5. You have no skin in the game.

    6. Your metrics aren’t aligned to the actions you want.

    7. Your organization has OADD.

     

    1. Your organization has too many people.
    When an organization has more people, change takes longer to filter through. The larger a team is, the less motivated its members are to contribute (1). This means bigger groups, from teams to departments to companies, are less closely coordinated. Trust is linked to how tightly knit (2) an organization is, it matters for your company’s performance (3), and it’s key to sustain the radical behaviors you need to support your values.

    We now know when silos start forming in a company – at around 150 people. As a company with a traditional org structure gets bigger, the distance between your people will get farther. How can you keep those values real and relevant from all the way at the top?

      

    2. Your top management team doesn’t agree on the company’s values.
    You probably trust that your top management team has some sense of what’s going on. Usually, you would expect they are aligned in three key areas: the strategic direction, the current state, and the core values of the company. But are you sure they truly agree?

    Anyone who has worked with top management teams can tell you, this is a challenge. Good thing there’s an exercise to figure this out. If you can find some time with each executive, have them write down what the company’s values are, what they mean by [insert your business challenge here], or how they would measure whether employees are living a key value at work. You may be surprised by what you learn – I know I’ve been!

     
     

    3. Your organization’s decisions are slow and multi-layered.
    If people in your company can’t act on their decisions quickly, because any changes must go through multiple people or layers, the end result could look nothing like the values your company talks about. If you can make things easier by removing barriers and bottlenecks, you can close the gap between your company’s values and your employee’s actions.

    It sounds like I’m advocating for a flat organizational structure, because I talked about changes going through many layers. But flat org structures can be problematic. For one, they can create bottlenecks that make the company less efficient, if you have a handful of people responsible for reviewing everything. Researchers found that planning and coordination, not flat structures directly, improved business performance (4). Simply removing layers or getting rid of managers (Google tried this and quickly switched back to having them) might not help – purposeful planning and coordination can help companies make better and faster decisions.

     
     

    4. You are scared of the unknown, so you don’t take risks.
    Radically embodying the values of your organization takes guts. In the case of August, the consulting group, putting all your financials and current work on a publically accessible cloud can hurt the company. For 3M, letting employees work on their own projects for 15% of their paid time could be a waste of money. For FullContact, paying out thousands of dollars to employees to enjoy their vacations can seem like money down the drain. Each of these companies pushed past their fears of the unknown, focused less on what could go wrong, and took a leap towards a radical embodiment of their values.

    So what can you do to take the risk and test out radical manifestations of your values? Start by reframing the question. If you are debating giving your employees 15% of their work time to work on new and innovative projects, you can frame this negatively (i.e., “we are losing 15% of the time employees could be working on something useful”) or you can frame this positively (i.e., “we are investing 15% of employees time in new products and services, and giving them more autonomy at the same time”). Frames can reduce our focus on losses and change our attitudes about risk – and you can use framing in any issue.

     
     

    5. You have no skin in the game.
    Like many scientists, I hedge my statements – a lot. When I say things like “it depends”, “in some cases”, “X might lead to Y”, I’m erring on the side of being really cautious. I might be more accurate, but I’m not taking the risk of being straightforward.

    A big part of taking smart risks is being invested in the outcome. If you are committed to the company, you are more likely to help the company do well. You might not be living out your values if you are not committed to the company, and if the company is not committed to its purpose. On the flip side, companies that are driven by a purpose and that live their values are more likely to reap those rewards on the stock market.

     
     

    6. Your metrics aren’t aligned to the actions you want.
    Want to motivate teamwork? Then why are you only giving out bonuses to individuals and measuring your employees’ performance as if they work alone?

    It’s very common that incentives are misaligned with the behavior people are really trying to drive. We want politicians to think about the long-term future of our country (economy, wildlife, trade relationships, etc), but they are elected every four years. Guess how long most of their horizons are? You guessed it: four years. We want CEOs to focus on long-term growth and stop cannibalizing profits through damaging cost-cutting strategies, but we let their stock vest in two-year intervals. We want people in groups to pull their weight, but we don’t hold them individually accountable.

    Even animals give trainers what they are looking for by gaming the reward system. When dolphins are rewarded with fish for bringing garbage to their trainers, the dolphins ripped the garbage into smaller pieces to get more fish. Humans do the same thing when we have budgets that don’t carry over; we use the full amount because 1) we will lose that money if we don’t (see “framing” above), and 2) someone will reduce the budget next year if we don’t use the full amount this year.

    If you are trying to improve quality in your software development, but you reward those who are faster, you aren’t sending a clear message. Once you align your metrics to the behavior you want to see, such as measuring individual contributions when you want accountability, and measuring group performance when you want collaboration (or both!), you will see real change.

     

     
     

    7. Your organization has OADD.
    OADD, or organizational attention deficit disorder, happens when senior leaders’ attention is not focused on the company’s priorities. Just like values, priorities are not what you say is important. Priorities are reflected in company decisions: the content of your agendas, the biggest line items in your budget, and the departments you hire in (for growth, not for replacement). By definition, your values are what you consider important. Keeping your attention on what you consider important, instead of switching to what catches your eye, helps to close the gap between what you say and what you do.

     

    I hope this guide is helpful for removing your company’s barriers – if not, give me a shout. Either way, tell me what you want to see next!

     

    Natasha Ouslis is a consultant and a researcher in org behaviour, completing her MSc and PhD at Western University in Canada. She is a writer at Science for Work, a nonprofit that communicates workplace-relevant research, and a member of the Centre for Evidence-Based Management. In her “free” time, she mentors students and gives talks about higher education, technology, and the science of HR.

     

    References

    1. Chidambaram, L., & Tung, L. L. (2005). Is out of sight, out of mind? An empirical study of social loafing in technology-supported groups. Information Systems Research, 16(2), 149-168.
    2. Mach, M., Dolan, S. and Tzafrir, S. (2010), The differential effect of team members’ trust on team performance: The mediation role of team cohesion. Journal of Occupational and Organizational Psychology, 83: 771–794.
    3. LaPorta, Rafael, Florencio Lopez-de-Silanes, Andrei Shleifer, and Robert W Vishny. 1997. Trust in Large Organizations. American Economic Review Papers and Proceedings 87, no. 2: 333-338.
    4. Yinan, Q., Tang, M., & Zhang, M. (2014). Mass customization in flat organization: The mediating role of supply chain planning and corporation coordination. Journal of Applied Research and Technology, 12(2), 171-181.
  • Evidence-Based HR: What It Is, and Why We Should Care

    Thanks so much to Jane for this wonderful feature!

    Talent Vanguard

    I’ve been wanting to write about evidence-based HR for a while, in part because back in 2013 I wrote a blog post critiquing the idea (brattily titled: “Evidence-Based HR: Are We Kidding Ourselves?”) and have since completely changed my opinion. This time, I’ve left it to the experts and invited the wonderful Natasha Ouslis to set me straight on what evidence-based practice in HR is and isn’t, and why we should care.

    View original post 2,858 more words

  • What is Science?

    The word science conjures up images, not all of them positive, for people who don’t have much exposure to it.

    Some may think of researchers in lab coats, mice running through mazes, or their most-hated class back in high school.

    But what if I told you that all the associations you make are accessories to science, but have very little to do with the real thing?

    Let’s go on a journey of what science is, using a leadership example.

     

    What is Science?

    At its core, science is a process: through that process, scientists create a body of knowledge we can draw from and apply to business. The scientific process follows these steps:

    H: hypothesize (define the question you are asking)

    O: operationalize (fancy word for turning your question into a metric you can collect data on)

    M: measure (gather the metrics through surveys, observations, sophisticated technologies, etc)

    E: evaluate (analyze the data and determine the impact)

    R: replicate (extend or re-do the process by going back to the beginning – it’s an iterative process)

    For a (rough) visual representation of the information above, head over here.

     

    Yes, it spells Homer. Scientists find that mnemonics are helpful, so imagine either the Simpsons Homer or the Greek philosopher Homer to remember the scientific method more easily.

    homer(s)

     

    Let’s use a leadership example. You want to know if your company’s day-long leadership training works. Let’s use Homer’s (whichever Homer you prefer) scientific steps to find out if the leadership training is effective.

     

    Hypothesize: What do we mean by leadership? What do we mean by ‘it works’, as in, it works compared to what?

    Let’s say by leadership, we mean the leaders’ team improves. By it works, we mean compared to people who haven’t done the leadership training.

     

    Operationalize: What metrics are we using for leadership (i.e., the leaders’ team improvement)?

    This company has a team performance review, so we can use the data from the review.

     

    Measure: How, when, and where are we measuring the impact of leadership training on leaders’ team performance?

    Imagine we run a pilot experiment with 70 leaders randomly allocated to the leadership training group and 70 leaders randomly allocated to an “unrelated day-long exercise” group four months before the bi-yearly performance review. Then we measure the performance evaluations of their teams four months later, at the next performance review. We keep track of which leader was in which group, who were in the leaders’ teams through the four-month interim period, and the team performance scores during the review four months later.

     

    Evaluate: Did it work? Specifically, did the leaders from the leadership training group have better-performing teams in their next performance review than the leaders from the unrelated day-long exercise group?

    We gather the scores from the one group and we gather the scores from the other group, and we compare the scores. The leadership training group scored higher than our rigorous threshold, so we can conclude that yes, the training works!

     

    Replicate: How should we revise/replicate/improve the test to learn more, if needed?

    If we are confident in our results, we may want to move to a full-scale, company-wide test to make sure. We may want to measure leadership in another way, to check that this training doesn’t only improve the team’s performance. We may want to compare the champion this time with a training program we think will do even better.

     

    Companies can use this scientific process in any business function or externally with customers and clients, if they follow legal, ethical, and moral guidelines. An ethics guide for behavioral science experiments outlines some of the key questions to ask when running experiments within companies. The same principles apply for experimenting on customers – if you want to see the backlash that running experiments on customers can have, you can explore the coverage of Facebook’s user experiments.

     

    It may seem like a rigid process, but these steps have brought us technologies, designs, medical discoveries, and teaching innovations. This humble process has cured diseases, connected people, lengthened lifespans, educated students, and saved us so much time, we now spend it on the technology that the scientific process discovered! Even if you aren’t in the business of saving lives, education, or curing diseases, following the process of science can benefit you and your company.

     

    How do you see science being applied in your company? Send me your thoughts through the Contact page, share your ideas with the world in the comments section, or read my next article (coming soon!) on why business leaders should care about and use science.

     

     

     

    (Homer Simpson drawing and Alamy stock photo of the Greek philosopher Homer)

     

     

  • The Case for Science-Based Hiring

    Hello world!

    The inagural post will take you through the business case for, and a summary of, science-based hiring. This field has been busy for more than 100 years, testing out different hiring practices to see which ones work to predict how people will really do on the job, and which ones don’t.

    The amazingly productive team of Schmidt, Oh, and Shaffer published a report in 2016 that compared 31 hiring practices, found the gold standard, and looked at the improvement (if any) of predictive power when you combine each practice with the gold standard.

    What is that gold standard, you may wonder? Explore the presentation to find out!

     

    How can you incorporate science-based hiring into your company? Comment below or reach out through the Contact page, especially if you have a difficult question you think will stump me.

     

    Scientifically yours,

     

    Natasha