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Monday, April 26, 2010

What Leaders Need To Do To Keep Top Talent Happy

With unemployment rates so high, you may think that your employees have no option but to stay with your company. That is a dangerous assumption. As we move into recovery, employees — especially star performers — are likely to start weighing their options. Use these four tools to keep your stars where they are:

  • Praise. It is the most inexpensive and underutilised tool out there. When your stars do something right, say thank you.
  • Challenging assignments. Give your top performers the opportunity to work on new projects that build their skills and give them a chance to shine.
  • Development opportunities. Find inexpensive ways to deepen your stars' skills such as providing mentors or opportunities to teach others.
  • Non-monetary perks. Most top performers crave things that are intangible and easy to provide, such as flexibility, better work/life balance, or more autonomy.


Are You Squandering Your Intelligent Failures?

Columbia Business School professor Rita McGrath studies innovation, corporate venturing, and entrepreneurship. Her latest book is Discovery-Driven Growth: A Breakthrough Process to Reduce Risk and Seize Opportunity.

Here is what she has to say about the concept of ‘intelligent failure’:

‘Despite widespread recognition that challenging times place unpredictable demands on people and businesses, you still run across many managers who would prefer to avoid the logical conclusion that stems from this: failure is a lot more common in highly uncertain environments than it is in better-understood situations. Instead of learning from failures, many executives seek to keep them hidden or to pretend that they were all part of a master plan and no big deal. An extraordinarily valuable corporate resource is being wasted if learning from failures is inhibited.

Naturally, to an executive raised on the concept of "management by exception," any failure at all seems intolerable. This world view is reinforced by the widespread adoption of various quality techniques, for instance, six sigma, in which the goal is to stamp out variations (by definition, failures) in the pursuit of quality. Managers are supposed to be right, aren't they? And having the right answer is just as valuable in management as it was in school, right?

Perhaps not.

For many years, scholars such as Sim Sitkin of Duke (see his article "Learning through failure: The strategy of small losses,") have been studying how organisations learn, and they have come to the conclusion that intelligent failures are crucial to the process of organisational learning and sense-making. Failures show you where your assumptions are wrong. Failures demonstrate where future investment would be wasted. And failures can help you identify those among your team with the mettle to persevere and creatively change direction as opposed to pig-headedly charging blindly ahead. Further, failures are about the only way in which an organisation can re-set its expectations for the future in any meaningful way. 

Not all failures, of course, are going to be useful from a learning point of view. The concept of intelligent failure makes a difference here. Sitkin's criteria for intelligent failures are:

•They are carefully planned, so that when things go wrong you know why.
•They are genuinely uncertain, so the outcome cannot be known ahead of time.
•They are modest in scale, so that a catastrophe does not result.
•They are managed quickly, so that not too much time elapses between outcome and interpretation.
•Something about what is learned is familiar enough to inform other parts of the business.

We could add a couple of other criteria:

•Underlying assumptions are explicitly declared.
•These can be tested at specific checkpoints, identified in advance, since planned results may not be equivalent to outcomes.

If your organisation can approach uncertain decisions as experiments and adopt the idea of intelligently failing, so much more can be learned (so much more quickly) than if failures or disappointments are covered up.

So ask yourself: are we genuinely reaping the benefit of the investments we've made in learning under uncertain conditions? Do we have mechanisms in place to benefit from our intelligent failures? And, if not, who might be taking advantage of the knowledge we are depriving ourselves of?’