Category: Topic – Culture

Why ‘Good Management’ is bad and ‘Mad Management’ is the answer

THE FOUNDATION FORUM

27th June 2018. WRITTEN UP WITH THE HELP OF SIMON CAULKIN

To download a PDF of this write up, please click here: Why ‘Good Management’ is bad and ‘Mad Management’ is the answer

steering

 

For a long time we thought the Earth was flat.  But if you’re faced with a mix of what looks obvious and what everyone else seems to be convinced by, you have to be a pretty strong character with an unusual degree of insight to go another way.

Let us put it to you that this same degree of mistaken herd-like belief applies to the way we manage our organisations and institutions today.  Maybe, instead of being a highly sophisticated super-species, we are still early in our evolution when it comes to running things with very large numbers of people in them.

Let us give you an example.  In most organisations this success is achieved by setting higher sales targets, promising people lots of money if they hit them and shouting at them if they don’t.  Which sounds obvious.  And it works too, for a while.  It only becomes tricky when the sales push goes beyond what can be comfortably achieved with willing customers.  At that point you get to high pressure sales tactics, manipulating people to get a yes, and then to targets like selling 8 products per customer and illegal ways to meet them because the consequences of failing, or the social difficulty of challenging the norm, are both more painful than the prospect of being found out.

Approaches that are literally accepted wisdom can become toxic. But this Forum wasn’t just about criticising.  We had a conversation containing hope, illumination, constructive suggestions and examples of success.

Our three speakers brought unusual ideas rooted in experience and the real world.  They weren’t idealistic start-up fiends!  They brought ideas that sound bold and unusual which in fact lead to sensible, useful and productive outcomes. We had…

 

Pernille Sahl Taylor, Chief Communications Officer at Swedish Bank Handelsbanken, which is 147 years old, publicly quoted, immensely commercially successful and utterly unconventional.  It is largely unheard of despite having 208 UK branches and a significant presence in six countries. Since the early 1970s it has been run very unconventionally by the standards of any business not just a bank.  It gives local branches autonomy within their area to choose their customers, decide what to lend, what to charge and how to staff up including dealing with all customer types, from individuals to small businesses to vast corporates. Handelsbanken has only one target – for return on equity to be better than the average of its sector, something the bank has achieved every year since 1973 – and beyond that, nothing.  No targets and no budgets because they believe these encourage unhelpful behaviour.  This is just the tip of a very unusual iceberg.  They are understated but we have much to learn from them

David Alexander, a Director at Centrica, former MD of their Home Services Division, and more unconventional than his titles might sound.  He has led innovation including the Uber meets Plumbing mash-up that is their Local Heroes service (https://www.localheroes.com/) and he has developed what he describes as the joy of imperfect management as a way to help people find their human common sense and confidence at work, another obvious sounding but rare occurrence.  Currently David leads a number of businesses in Centrica that resolve 550,000 plumbing domestic ‘emergencies’ and 600,000 heating breakdowns per year.

And our very own Simon Caulkin, the immensely respected business writer, who showed us why everything we know about management is diametrically wrong.  He is former Management Editor at the Observer, an early Editor of Management Today and a widely published commentator who we have known for many years, great at showing how what’s accepted is not what’s helpful, for business and for society too.

These are big questions but they matter assuming that we want to get beyond the equivalent of Stone Age management.  Where did we get to on the night?

 

Management Madness.  The discussion that followed, summed up by Simon Caulkin

From the sophisticated heights of the 21st century it’s easy to condescend to our superstitious ancestors. As Forum chair Charlie Dawson noted, time was when bien pensants would have shuddered at crazies who denied that the earth was flat, and it took a fundamentalist fanatic like Galileo to advance the self-evidently barking idea that the sun and not the earth was the centre of the universe.

Yet although we are massively better informed about the physical world today, future generations may marvel at our one-dimensional notions of our humanity, and in particular how simplistically, even dangerously, it uses them in management – the vital technology of getting things done in organisations.

They might wonder at the idea that management could be thought of as a science, like physics, and that the business cosmos revolved around the shareholder. They might think it weird that a discipline that presents itself as hard-nosed and pragmatic is in fact the opposite, based not on empirical research about ‘what works’ but on ‘what would work if certain assumptions were true’: the two most important being that the purpose of companies is to maximise shareholder value (‘the dumbest idea in the world’ – Jack Welch), and that all human beings are motivated uniquely by economic self-interest and opportunism. No wonder Prof John Kay once remarked that our knowledge of management was about where medicine was in the mid-19th century.

In different ways all three speakers at a well-attended and attentive late-June Forum took aim at the absurdly unrealistic view taken by conventional management of the human element in business.

 

For David Alexander, a director at Centrica, the target was perfectionist notions of leadership that put more people off than they inspire – which is ‘a great shame, because the reward in business is not from the few perfect leaders and instead from the many who choose to become good, imperfect ones’.

(There is heavyweight support for this position: Peter Drucker once said that organisations needing super-humans to run them could never survive, and Warren Buffett more cynically that you should only invest in businesses that an idiot could run, ‘because one day an idiot will’. The withering conclusion of top Stanford researcher Jeff Pfeffer is that most of today’s utterings about leadership have more in common with lay preaching than social science.)

Good imperfect leaders, said Alexander, have qualities that are recognisably and directly human.

They are inquisitive, alert to what people are both saying and doing, have the courage to act on less than complete knowledge, and behave as themselves rather than trying to be something they aren’t (he shrewdly noted that the ‘corporate twaddle’ that fake leaders talk is a reliable giveaway of inauthenticity).

The best imperfect leaders tell great stories too. ‘I don’t have a toolbox,’ he summed up, ‘because at Centrica toolboxes used to injure more people than anything else. In their place we have a tool roll, and in my leadership tool roll would be a badge, and on that badge it would say simply ‘how can I help you?’, to remind people to be inquisitive and listen with their ears and their eyes. There would be an egg timer or an hourglass to remind people to have the courage to be decisive, to make a good-enough decision soon not a perfect decision eventually. There’d be a mirror to remind them to be themselves and authentic, and there’d be a Nemo toy to remind us of the power of simple stories… By taking a more pithy human being rather than human doing approach we can all be great imperfect leaders.’

tools

The second speaker, Pernille Sahl Taylor, is chief communications officer at Handelsbanken UK, the branch of the Swedish group that is one of the fastest growing banks in Britain (not that this rate of growth matters to them, as we will see.  They are more pleased to have the highest customer satisfaction scores in the sector – nine years running according to EPSI who run an independent survey of such things)

Handelsbanken is distinguished as much by what it doesn’t do as what it does. It doesn’t do conventional marketing or budgeting, it grows without product or sales targets, and doesn’t pay individual bonuses. Says Taylor: ‘We have one simple corporate goal, which is to have a slightly higher return on equity than the average of our peers, and we achieve that by having lower costs and more satisfied customers. That is how we have run the bank since the early 1970s, and we have reached our corporate goal for 46 years in a row.’ Part of the excess is shared equally among all employees.

Handelsbanken’s secret is hidden in plain sight. It employs people who like to do banking and trusts them to do what it takes to make customers happy.

It opens new branches as and when it needs to in order to satisfy customer demand, and when it has enough good employees who are able to do it.

Handelsbanken’s equivalent of the ‘tool roll’ is a church spire, the view from which defines the area a branch can serve. The bank is the branch and the branch is the bank, with full decentralised responsibility for choosing customers, products and the rates it offers. Headquarters offers support and, crucially, guardianship of a guiding philosophy founded on a positive view of human nature: when Jan Wallander, the architect of the modern bank, wrote a book about it, the title was ‘Working With Human Nature and Not Against It’.

church

It sounds simple, and it is – but it is a sad commentary on contemporary business that, like the idea of imperfect leadership, it is also extraordinary and exceptional in today’s world, inspiring puzzlement and cautious admiration among other organisations – but not whole-hearted imitation.

Handelsbanken is not alone in this, pointed out Simon Caulkin, journalist and business commentator (and also of course, author of this note!)  In many industries there is a company like the Swedish bank that thrives mightily by doing the direct opposite of its conventional rivals. Call them ‘positive deviants’: Toyota, Apple, W.L Gore, Semco, Berkshire Hathaway… the list goes on. Why is the lasting success of such exemplars – which is neither fluke nor conceptually hard to understand – so consistently ignored and marginalised by the mainstream?

The only answer is that the underlying assumptions are so profoundly different that holding both in your head at the same time is impossible. You can’t get from RBS to Handelsbanken, or from Ford to Toyota, by incremental means: the roads lead in different directions.

Yet it’s the exceptions that are right – organisational Galileos or Copernicuses – and the mainstream that are the successors to the flat earthers of the 17th century.

It’s no exaggeration to say that the things wrong with our organisations – oppressive hierarchy, lack of trust and engagement, petty regulation, burgeoning bureaucracy, mediocre performance (pretty much everything, in fact) – are the result of trying to cram the crooked timber of humanity into the reducted equations of shareholder capitalism.

Alexander noted that many in his organisation, Centrica, especially the middle managers, didn’t initially feel at all comfortable with his Local Heroes initiative ‘because it was something beyond its command and control, a fundamental challenge to the organisation, so they tried to smother it with governance and all the rest of it. It was really difficult, very energy sapping and while well-meaning, it almost proved terminal’. In the same way fear of losing control prevented it handing more autonomy to skilled engineers even though they imposed tighter budgets on themselves than the organisation did. ‘The organisation can’t handle that free spirit. It worries about the few bad apples, so the whole thing is structured to manage that exception rather than the rule.’

Here in a nutshell is the reason why bureaucracy always increases, bullshit jobs multiply, new technology is used for job control rather than liberation – and management, unlike other disciplines, never gets better, just more complicated. Hence Peter Drucker’s famous lament that ‘so much of management consists of making it difficult for people to work’.

Here also is business’s very own version of Catch-22: to build a high-trust, low-cost organisation like Handelsbanken is eminently sane; but since it is so unusual, and it appears to involve giving up control, it’s crazy and you can’t do it.

And most companies don’t. As Taylor stressed, such a structure ‘comes with great flexibility, but also great responsibilities’ – one of which is to employ only people who fit. ‘It’s not for everyone. But we aim to employ people for a long time, so we take great care to find people who share our values… It’s like a big orchestra. If someone is playing the wrong tune it’s easy to spot – but you have to deal with it’.

This is is danger of sounding easy, and perhaps once you’re in this logic, it is.  But for most companies it’s the hardest thing in the world. The danger, of course, is that considerations of what is ‘sane’ and ‘crazy’ become normative and thus self-fulfilling. Unlike in the physical sciences, in human affairs beliefs can create their own reality. Sufficiently widely shared and used to shape how we think and act in their societies and organisations, such definitions and theories can harden into self-fulfilling prophecies, trapping organisations and leaders in sterile or harmful cycles of behaviour that are almost impossible to change. You can see it happening in our frozen organisations now.

The antidote: memorise the contents of the tool roll, and the church spire. Repeat to yourself at least five times a day: everything we have learned to think about management is wrong. Take heart from the great physicist Nils Bohr, who after a particularly contentious seminar observed: ‘We are all agreed that your theory is crazy. The question that divides us is whether it is crazy enough to have a chance of being correct.’

 

 

The Foundation’s view

Strong views then.  As the smoke cleared, what were we left concluding from the evening’s slaying of sacred cows?

  1. At the root of this issue are the shared beliefs we have come to hold about work and how it is done. Shared beliefs are powerful and invisible.  We are social animals and we are good at fitting in with a group, supressing what we might believe individually in favour of what seems to matter collectively. Changing shared beliefs is very difficult for one person and it usually happens over many years with many separate ‘moments of belief’ – belief-changing actions that show there is a better way.  Think apartheid, suffragettes and #Metoo.  On an everyday level what gets most firmly in the way is our fear of looking silly – of being laughed at and not accepted by the group.  It sounds small but it is huge.  So what David described was fascinating.  He has learned to do things in effective but unusual ways, human ways, in a large and conventional organisation.  The key seems to have been finding a label that legitimises unusual ways of behaving in the eyes of people holding the prevailing beliefs.  So he calls his approach imperfect leadership, recognising that it deviates from the accepted view of what’s right, and he then labels four simple-sounding ways of doing things that are each a way of being ‘human’ at work – for example making decisions with 80% of the information 100% on time as a prompt to make progress and make mistakes, and for that to be fine.

 

  1. Simon described things from the other end of the telescope, the very big picture. His realisation was that organisations work as complex systems, but conventional ‘good management’ works at a more simplistic level – direct inputs leading to successful outputs.  Simple inputs and outputs sound logical – they make sense to us individually.  Are waiting times too long in A&E?  Then set a target to reduce them and penalise people if they fail.  In a simple world that would work.  But in a system it’s more complicated than it looks – the reason the waiting times were long wasn’t that the people involved were lazy or stupid and in need of a push.  There are numerous things outside their control that contribute.  So given a simple target, penalties for missing it, and little control over, or even understanding of, what it would really take to achieve the outcome, all that’s left is manipulating the work and the measurement to hit the target.  For example keeping patients in ambulances until the A&E team is ready because the clock only starts when they move from ambulance to A&E.  Quick fixes litter our world – simple promises, attractive and logical, that are impossible to fulfil because they miss the bigger systemic picture.  Like Brexit and £350m to the NHS perhaps?  Quick fixes are an important enemy in this discussion

 

  1. Before you despair, there is a better way. Not natural because of our habits and instincts, as above.  But human AND effective, at a whole-organisation level.  Pernille described what this answer, not ‘the answer’ she was careful to emphasise, can look like.  Handelsbanken is more than 160 years old but since the early 1970s it has operated in a very unusual way.  Central to this is a stated belief that became shared.  It is a belief in people and that an organisation set up to work with human nature and not against it will work better.  This means trusting – assuming that people want to do the right thing and that if they have the skills, the information, the support and the tools they need, then they will do a good job.  In a bank this meant decentralisation – putting branches in control, within small geographical areas, of who their customers are, what they are charged, what lending is offered and on what terms…  And this means ALL customers.  If your area includes 500 individuals, 40 small businesses, plus Shell and Unilever’s HQs, then that branch handles the lot.  All of Shell’s banking, all of Unilever’s banking, and the small businesses and private individuals too.  So the branch has to staff up accordingly.  ‘But that’s mad’.  Yes, in conventional terms it is.  But it’s better. The fascinating thing about what Pernille described is that even at Handelsbanken, after nearly 50 years of success and 50 years of deepening shared beliefs about the way the bank operates, it is somehow still un-natural for things to just stay this way.  There is a gravity pulling us to the simplistic quick fix, and it takes conscious and determined resistance from the leadership of the bank to, in their words, keep pushing the cork back into the bottle of water.  ‘Moments of belief’, in our language, are what do it – specific actions that show that the unusual way is still the way that works and the way things are done around here, like asking a team member to stop keeping track of how many credit cards each branch has sold because human nature will lead to competition between branches.  And that will in turn lead to a shift, from only doing what matters to customers to doing what grows volume instead.

 

About The Foundation

We are a management consultancy specialising in growth. We help clients address big organic growth challenges; growing faster, growing into new markets or fending off threats to growth

What these challenges share is the need to influence customer behaviour, but this is inherently tough. Why? Because people in any organisation naturally see the world from the inside-out, with colleagues close and customers distant, and lots of assumptions about how things work that aren’t challenged

We help clients look from the outside-in, re-connecting them with what customers really value (the problem they want to solve, not usually what the client sells), then finding new and better ways to create this value

This means working both as expert advisors and facilitators. The issue with simply gathering outside-in information is that it lacks impact to get senior teams to tackle inconvenient truths in what customers want, and to believe their own organisation can be different

By using ‘Immersion’, personal conversations with customers and leaders of organisations in other sectors who have tackled parts of their challenge, we help teams get around the natural and limiting inside-out beliefs that stand in their way. This helps them develop better answers for customers and new ways of achieving lasting success

We answer three sizes of question:

  • Small – a new proposition or an improved customer experience
  • Medium-size – growing value per customer or improving retention (a sub-set of the former)
  • Large – creating customer-led business success, often by uncovering a true outward-looking purpose and the genuine belief needed for it to be acted on

Our clients include HSBC, JLR, O2, M&S and Ebay, with achievements including helping create Plan A at M&S, adding £100m of value to a Travelex travel money proposition, and giving Morrisons a competitive direction contributing to their return to growth

Behind our work our most distinctive characteristic is our team and their outlook. Each individual is motivated to and experienced in crossing the border between the worlds of customers and business which often resist mixing well

This link will take you to more information about us and our Forum events: http://www.the-foundation.com

 

Contact Details

Charlie Dawson (Founding Partner):

cdawson@the-foundation.com / +44 7785 268 859

Charlie Sim (Director)

csim@the-foundation.com / +44 7958 574 917

Anna Miley (Director)

amiley@the-foundation.com / +44 7816 261 987

John Sills (Director)

jsills@the-foundation.com / +44 7990 943 402

 


Why Diversity is Difficult – Plus what it means and why it matters

THE FOUNDATION FORUM

31st january 2018. WRITTEN UP WITH THE HELP OF SIMON CAULKIN

To download a PDF, please click here: Why Diversity is Difficult – Plus what it means and why it matters

The aim of this Forum was to get beyond the blather about diversity.
Genuine diversity is a difficult thing to live with. A united team just flows. When the awkward squad gets involved the temperature goes up, exasperation grows, debate intensifies, progress slows. Diverse views are often unwelcome.

‘They make you stop and think, they make it hard to agree. We’re wired deep down to go with our own. We’re social animals and if someone looks or sounds or behaves like they’re from a different tribe we can’t help our dog brain kicking in, telling us to beware.’

It might be a social effect but it’s not a helpful one for society. To be tolerant, peaceful and happy we need free expression, choosing what we love because we won’t appreciate everything, but not closing down what we don’t. This can be tough when views are distasteful, challenging values held dear. There need to be boundaries, but how are they set and policed? Who decides what is useful dissent? When does an argument poison society more than it adds in resilience?

‘Like we said, it might sound all sound obvious but it is anything but.’

So we asked three people with vivid experience and well thought-through views to share them with us. Our aim was to add depth to the nodding of heads and a counter-point to the divisive politics of our age.

Jan Gooding is at the heart of diversity’s main roads and in a position to influence the establishment. She is Aviva’s first Global Inclusion Director leading on their diversity and inclusion strategy. She is also Chair of Trustees for LGBT charity Stonewall.

Ije Nwokorie was until recently CEO of global creative consultancy, Wolff Olins, in an industry with strong white middle-class male tendencies. He has been successful in a very human and personable way, despite the odds being stacked against him.

Jodie Ginsberg is chief executive of Index on Censorship who exist to promote diversity of views no matter how tricky this is in the countries their work takes them to. She has argued against student unions and in favour of hard-line religious speakers being allowed on campus because free expression is not just about embracing safe, comfortable debate. She has thought deeply about where society’s lines should be drawn if we want a tolerant and open world.

So did we find meaning beyond cliché, sense in sensibility? Did we emerge with guidance to help our grappling with reality? Simon Caulkin has summarised where we got to on an evening of enlightenment and the odd challenge too‘It’s a tricky subject’ warned the chairman.

Too right. ‘Jesus, do we really need another report on this?’ exclaimed the first speaker crossly. ‘Ugh,’ grimaced the second, reporting his wife’s reaction on hearing the subject of his contribution. ‘Talk less.
Listen more. Thank you’, was the concise summing up of the evening’s lessons by the third.’

Phew. At first sight the heat engendered was surprising, given that the subject of the January Foundation Forum, one of the most revealing and challenging ever, was diversity. And if there’s one thing that you won’t get anyone to say anything against these days, at least in public, it’s diversity. It’s so politically correct it aches.
‘And that, it turned out, was one of the things that made people cross.’
We really don’t need another report saying that firms with diverse leadership and people are more innovative, grow faster and are more profitable, declared Jan Gooding, Director for Global Inclusion at insurer Aviva. Just do it.

toomanypigeons

Ije Nwokorie, until recently CEO of brand consultancy Wolff Olins and now at Apple, rejected the very idea that you needed a business case ‘just to give people just a chance to survive in our organisations’. It’s not that it’s not important: we do need strategies and arguments – but that’s what makes it a tiresome, even ‘skin-crawling’ subject to deal with. Oh, and he wasn’t going to answer the questions the chairman had posed in setting up the session – what it means and why it matters – but simply tell some stories. (Although it turned out these answered the questions rather well)
What got up the nose of third speaker Jodie Ginsberg, ex-journalist and now CEO of Index, was a variant on the same thing – the tick-box approach that assumed that once the ‘correct’ ratio of colour, gender and sexual orientation had been complied with, that was it, job done. For Ginsberg the main challenge was something box-ticking doesn’t get near: ‘how do we marry corporate culture and a homogenous value set with a tolerance not just of race, religion, gender and sexuality but also of opinions?

‘How do we live with people whose political opinions are different from our own?’ Good question, which we’ll come back to later.’

For Gooding, a marketer who is also currently Chair of Stonewall, the LGBT rights campaigning charity, the commercial issue was relatively straightforward. At Aviva, she said, it was quite important not to come at diversity from an ethics and human rights angle. Aviva is a 21st century, technology-savvy insurance company dealing with customers who have suffered misfortune or who want to manage risk of some kind. ‘So what I said was that in
a digital world where we want to work fast, we have to be effortlessly in tune and empathetic. It doesn’t work if we’re just one type of person – and insurance people are of a kind, I can tell you’.
But while being different is important, people also need to feel they belong to the culture being created, because that’s when they enjoy their job and give of their best – which is at least 5 per cent better than those not so engaged. ‘So I’m afraid there is a nasty capitalism productivity argument’. An argument moreover that she could attest to personally. Not long after coming out as gay she joined Aviva and was advised to go back in the closet, which she did, and
‘I’m telling you it was absolutely untenable. It affected my performance by much more than 5 per cent’. So she came back out again.

stonewall_2
Then a little while later she was asked to be Aviva’s first Global Inclusion Director, and first on the to-do list was managing the fall-out. ‘There is a backlash. Even though I was careful to say, no, I’m not diversity director, I’m inclusion director, I’m here for everyone, men aren’t the problem – everyone is a minority in something. But someone somewhere thinks you’re taking something away so there will be a backlash’.
Nwokorie’s arc was just as revealing. Nigerian-raised, architecturally-trained in the US, entrepreneurial, he found himself at 34 harvesting plenty of job interviews but no offers – not, he insists, because of racism, more because people couldn’t think what to do with someone so difficult to pigeonhole: ‘We just don’t think you’ll fit’.

 

The world changed when Robert Jones, in charge of strategy at brand gurus Wolff Olins, decided that this was precisely the reason why Ije should be hired. ‘I think what got Robert and people at Wolff Olins excited was that they understood organisations needed to change, and if they were going to change they had to become less and less like what they already were,’ is how Nwokorie described it. That wasn’t (and isn’t) the norm for companies, or society, for that matter, for the good reason that it ran against the grain not of race but of tribe.
The tribe allows like to identify and bond with like (its strength), but by the same token it is also a powerful mechanism for sniffing out and rejecting potential threats to the integrity of the system.
The characteristic was of fundamental importance for industrial-age companies. In these times competitive advantage came from consistency, stamping out identical goods time after time. For this, the job of the manager was to ensure compliance.

Contrast that with today’s digital world where the differentiator is creativity, and creativity feeds on a multitude of diverse sources and ways of thinking. ‘I don’t care about another McKinsey report – for me that is the entirety of the business case for getting beyond uniformity,’ he said. And as with Gooding, it’s a case he has lived out himself. Three years after joining Nwokorie was running Olins’ London office. After seven he was global CEO, and Wolff Olins is now the dominant brand consultant in the UK and the west coast of the States. No one would argue that hiring a self-described ‘six-foot black guy wearing a lot of leather with a strange Nigerian/American accent, a booming laugh and comically exaggerated hand gestures’ wasn’t a brilliant decision.

Index Against Censorship, which Ginsberg runs, is a campaigning organisation that was created in 1972 to help artists trapped behind the Iron Curtain find the oxygen their work deserved by giving them an audience in the west.
Its central purpose is standing up for free expression. Her observation from direct experience is that ‘diversity is great until someone disagrees with you’. This is an angle that leads very quickly out of the comfort zone. It’s not just going beyond the tick box – although Ginsberg remembers with discomfort being taken to task for failing to realise that an apparently diverse panel she had put together faithfully reproduced in its composition the power structures that it was supposed to challenge. ‘It’s not even just saying we’re tolerant of your colour, gender and sexuality: it’s saying we recognise that you bring your whole person to the job. And sometimes doing that means you bring ideas and opinions that your co-workers disagree with.’

When that happens, how do you reconcile a strong corporate culture and values with the right to disagree? This was the issue at the heart the famous Google case, when engineer James Damore stirred up a hornet’s nest by querying the value of diversity initiatives when women and men had congenitally different aptitudes (incidentally, something recent research contradicts). ‘Google showed its tolerance of diversity by sacking James Damore. Now I’m not saying that I agree with his opinion on women,’ Ginsberg went on.

‘But asking people to suppress their opinions doesn’t make them go away. I do think as organisations we have to think
about better ways of handling the fact that other people have different opinions and may not always agree.’

It’s a key question that evoked suitably diverse reactions. Gooding warned of the danger of retreating into holier than thou purism, and of the need to accept that living with difference isn’t always comfortable:

‘You have to be prepared to offend, you have to be prepared to be offended. You have to cope with people’s rudeness. This is deeply personal’.

But only up to a point: the greater good demanded that there had to be red lines, and beyond them the cause
of inclusion might entail exclusion of those who couldn’t accept it – a tough leadership decision. She nuanced it with a plea for the benefit of the doubt, concluding impatiently: ‘Let’s calm down once we’ve got some diversity and inclusion in the mix and then get the prize, which is the creativity, the ideas and the new world that we all want to
have, because actually that’s what this is all about.’

Nwokorie confessed that he’d have probably done the same thing as Google – not necessarily because it was right ‘but because I would have been livid that somebody in my organisation thought fit to express the view that half of our employees are not up to the job’. But he set the comment in a wider context of privilege: the need for men in general to face up to the conditions they have created for women in the workplace, and in particular for straight white men to recognise that wherever they are, it is not at the bottom of the social heap. ‘So they can bear with the gay and black people and the women for a while, while we address the imbalance of hundreds of years. I’m a big fan of #MeToo, and if a few men wrongly get accused I think that’s collateral damage as we address these important things’.
Other important questions came up in the discussions, But in the end, perhaps the most telling argument in favour of diversity was the Forum itself, which in raising questions, half answering them, disagreeing, doubling back and reframing them, acted out the issue in a way it is difficult to do justice to here.
Opinions differed – naturally – about causes for optimism, or the reverse. Everyone agreed that to call it a tricky subject was a huge underestimate, and to make diversity work in practice is a test of leadership and self-scrutiny that everyone must face up to, bar none. But it was hard not to feel that the evening was part of the process of working through it, which was why it was both compelling and, finally, hopeful.

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As the chairman summed up, we’ve reached a point (in the world not the Forum) where we seem to be shouting at each other from greater and greater distance and understanding each other less and less. Yet ‘actually in business you’ve got a chance. You’re close enough to find out a bit more and listen a bit more, and of course it’s hard if you’re under pressure from the media or colleagues getting pissed off and shouting that you need to act or what have you. That’s maybe where you need to be strong and try and find some firm ground to stand on’. Maybe that’s where this kind
of discussion, in rehearsing the arguments, helps most profoundly. It feels we are a little bit nearer working this all out. And we didn’t even mention Brexit (until now – doh!).

 

THE FOUNDATION’S VIEW

So where did we come out? The three biggest things from where we were standing, not quite in the speakers non-matching shoes but ever so close to them, were these:

  1. As Ije described, diversity matters because as we move from an industrial to a digital age what it takes to win moves too, from sameness as in mass production, to creativity where difference counts
    Creativity can literally be described as putting familiar ideas together in unfamiliar ways. So if you want to increase the odds of an organisation being creative then putting people familiar with different ideas, beliefs and influences next to each other creates at least one part of the conditions for success. The start of a business case for sceptics perhaps?
  2. As Jan described, inclusion is a much more useful idea to act on than diversity. An inclusive business will find itself becoming more diverse because people beyond the original core find themselves feeling they fit, and able to do their best work as a result
    A  team of similar people will find it easy to get on, comfortable to work together, nice to be with. But when did comfortable lead to some kind of breakthrough? It’s not easy putting a new team together or starting a new business – chaos is an enemy and finding some kind of traction means aligning people, creating common ground. But there comes a point where order becomes the enemy not the friend, assuming you also have the skills to make the most of the raw material – inclusive leadership and a sense that as a team member I feel like I belong.
    In fact measuring this inside Aviva was at the head of the plan for Jan’s ways of assessing progress, not the more common tick-box lists of particular minority groups
  3. And then we had our final question, asking whether the panel would have done the same as Google and sacked James Damore. Jodie’s response showed being genuinely inclusive can go against your most immediate instincts
    Mr Damore’s views were distasteful to many, and definitely not inclusive in spirit. The most common visceral reaction might be outrage or similar, and that gets amplified by the wider popular response – upset people across departments, social media rage, a media campaign… But that doesn’t make it right. Free expression isn’t limited to views that are the same as the majority, even if you happen to be in the majority yourself and believe you are ‘right’. What Jodie described was a more tolerant response – space for the view being expressed and curiosity about what led to it being held.
    This means putting yourself firmly in other people’s shoes, maybe assuming good intent but a different set
    of beliefs from a different background, upbringing and life experiences, leading on to a search for at least some common ground and respect for difference. The opposite in other words to the discourse we’re having now around issues like Brexit where the two sides shout more and more loudly from greater and greater distances apart, with zero increase in mutual understanding and respect. This was very counterintuitive. It clearly requires emotional control. You might call it inclusive leadership

 

ABOUT THE FOUNDATION

The Foundation is a management consultancy specialising in growth. We help clients address big organic growth challenges; growing faster, growing into new markets or fending off threats to growth

What these challenges share is the need to influence customer behaviour, but this is inherently tough. Why? Because people in any organisation naturally see the world from the inside-out, with colleagues close and customers distant, and lots of assumptions about how things work that aren’t challenged

We help clients look from the outside-in, re-connecting them with what customers really value (the problem they want to solve, not usually what the client sells), then finding new and better ways to create this value

This means working both as expert advisors and facilitators. The issue with simply gathering outside-in information is that it lacks impact to get senior teams to tackle inconvenient truths in what customers want, and to believe their own organisation can be different

By using ‘Immersion’, personal conversations with customers and leaders of organisations in other sectors who have tackled parts of their challenge, we help teams get round beliefs that stand in their way. This helps them develop better answers for customers and new ways of achieving lasting success

We most often answer three questions:

  1. Developing new propositions
  2. Improving customers’ experiences
  3. Developing customer-led strategies for broader issues such as increasing retention or lifetime value

Our clients include HSBC, JLR, O2, M&S and Ebay, with achievements including helping create Plan A at M&S, adding £100m of value to a Travelex travel money proposition, and giving Morrisons a competitive direction contributing to their return to growth.

Behind our work our most distinctive characteristic is our team and their outlook. Each individual is motivated to and experienced in crossing the border between the worlds of customers and business which often resist mixing well.

Contact Details

Charlie Dawson (Founding Partner): cdawson@the-foundation.com / +44 7785 268 859

Charlie Sim (Director) csim@the-foundation.com / +44 7958 574 917

Anna Miley (Director) amiley@the-foundation.com / +44 7816 261 987

John Sills (Director) jsills@the-foundation.com / +44 7990 943 402


Do we believe in customer-led commercial success?

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Read full PDF here: The Belief Trade-off: Customers or Efficiency First?

Our Founding Partner, Charlie Dawson, is in the process of writing a book about customer-led business success alongside Seán Meehan who is the Martin Hilti Professor of Marketing and Change Management at IMD, the Swiss business school.  It is examining why breakthrough customer-led success happens so rarely given that when it does it often sounds like common sense, and also why once firms have succeeded in this way they don’t go on succeeding forever.

As a contribution to this we asked a large number of senior business managers, internationally, for their views, looking at the ways their companies address organic growth challenges and the relative effect that a focus on different stakeholder groups, in particular customers compared to the financial community, has on performance over time.

The piece this relates to is a summary of our findings.

In a world where managers frequently say they are customer centric, our research goal was to determine what they really believe.  What are their deeply held assumptions about success and how it is achieved?  Do they assume it comes from being aligned with and responding to customers current and future needs, which we call being customer-led? And if they do, does being customer-led affect overall business performance compared to other ways of operating?

It turned out that of the 454 senior executives who responded, 62.7% believe that understanding customers and acting on that understanding is critical to success.  But….  only 24% adopt a customer-led approach to running their business.

Using some good statistical analysis, led by our friends at IMD, the conclusions suggest that organisations are either customer-led or efficiency-led and that only the customer-led approach contributes to competitive success.

We are continuing our exploration of what it means to be customer-led and would welcome any reactions this summary.


Seriously High Performing People – Are they Found or Made?

THE FOUNDATION FORUM

26th april 2017. WRITTEN UP WITH THE HELP OF SIMON CAULKIN.

To download a PDF, click here: Seriously High Performing People – Are they Found or Made?

Nature or nurture is a perennial debate… and these are not words much used in the world of work which is somehow more direct. ‘Pay peanuts, get monkeys’ is another way you hear recruitment being described,while ‘ruthless performance management’, an approach that’s included firing the so-called worst 10% annually, is another approach to nurturing.Yet sometimes groups of people achieve something exceptional, and rather than wallow with the worst, we devoted a Forum evening to three views around the best.

One example is a tiny team with a vast challenge, so surely selection is all? The other two are big, well established teams with long histories of awkward relations between unions and bosses, public sector management and dreary performance. How do you change an environment like that? Firing everyone sounds attractive but isn’t especially practical, leaving nurture as the default option…
Our speakers, each with one of the best stories we’ve had for a long while, lined up like this:

  • We had Natalia Cohen, one of a team of six women who rowed, unsupported, 9,000 miles across the Pacific, the first time such a feat had been achieved. The group came together just for this challenge so they didn’t know each other from Adam, or indeed Eve. Somehow they had to literally get the right people in the boat, then find ways of working together in all weathers, no space, a 24/7 need to make progress, huge uncertainty, physical exhaustion, currents and a need to pay for it all, plus, as a bonus, not killing each other in the process. What Natalia learned is valuable, and not just when you’re up a creek of some kind.
  • We had Vernon Everitt, also one of a team but in this case overseeing the whole of London’s transport system as Managing Director for Customers, Communication and Technology at Transport for London or TfL. The world of London’s transport is not for the faint hearted. Numbers keep growing as the population increases, expectations rise as we all get a bit more American about service and digital media let us share our views. Yet the infrastructure available to move people around is brutally limited, largely build decades or more ago, with a workforce not afraid to challenge the management. Despite this the TfL team has achieved wonderful things including steering us through the Olympics, taking on roads, bikes, rail, ways of paying (Oyster then contactless technology) and the digital revolution (including free, open data) alongside buses and the underground, then dealing with terrorist
    threats and terrorist reality too. At the heart of the story is a clear reason to exist that has brought everyone together and given them direction. They have added useful insight into what matters (managing time in various ways). And then turned it into everyday practice with a resolutely honest, pragmatic yet imaginative approach, working through what’s in the way of a good result.
  • And we had Fergus Cusden bringing a story about safety at our National Air Traffic Service or NATS. Another organisation that was fond of the way we’ve
    always done things around here, and full of long serving air traffic controllers that had risen through the ranks, it didn’t look like fertile ground for something
    vibrant. Fergus was one of those who’d been there going on two decades, but something irked him about the attitude to safety. It wasn’t unsafe but there was
    an assumption that twenty or so risk-bearing near misses a year was as good as it was possible to get. What followed was a change of attitude, initially at the
    top, in two ways – any near miss was one too many and the ambition for zero was boldly stated internally. And then the senior team admitted they had no idea how to get there, to everyone, loudly. What followed is somehow counter-intuitive and complete common sense only underlining how uncommon such thinking is in business. It also worked, and Fergus told us how.

In a previous Forum we looked at a similar subject from another angle, getting insight into why good people do bad things. It turned out that no matter how ethically inclined an individual, the system they work within determines 85% of their performance. Why? A mixture of targets that point away from what matters and towards what’s easy to measure, coupled with authority that is difficult to defy even if gently expressed, and in many places its style is closer to robust.

“So the system is critical to performance and surely the answer we’re looking for, no?”
“There’s another view that’s also persuasive. Recruit for values and train for skill.”

The assumption here is that the qualities you really want in any group of people assembled around a shared goal are those that naturally fit. When we have individual preferences for ways of doing things, and principles that we hold dear,
it’s best to mix like with like. Fairness and democracy plus individualism and market forces tend to equal a difficult result. Precision and reflection versus ‘charge’ can be similar. Of course a balance of some kind is ideal, but perhaps more a balance of ways of working rather than more deeply held attitudes and beliefs.

“In our work we have learned about the importance of belief – less in individuals and more what’s shared, unspoken, across a group.”

If the group believes you exist to maximise profit, no amount of saying customers come first will make it so. What actually happens is mainly the former, only reinforcing collective certainty that deeds not words tell the story of priorities.
Changing or shaping these shared beliefs is extremely difficult. We’re social animals and we like to fit in, so even the most determined CEO can find themselves slipping beneath the surface, overcome by the status quo, or if they’re more determined experiencing organ rejection (in this case all of their organs and whatever fits in a cardboard box). Which goes to explain why this conversation promised much. Two versions of changes in beliefs, encouraging people to care and to try things that could have been rejected out of hand, and one of the forging of belief amongst a group freshly recruited, who didn’t really have much to go on other than a small vessel and an awful lot of water.

So to the discussion itself – three views, plus wisdom from around the room, on how where human high performance is found, or how it might be created, summarised by Simon Caulkin

Spending nine months rowing 9000 miles across the Pacific as part of a six-woman crew in a 29-foot rowing boat called Doris, setting two world records in the process, is seriously high performance by any standards. So on a different scale is moving 2 million aircraft and 150m passengers safely through increasingly crowded UK airspace annually with a vanishingly small margin of error. Likewise the challenge of keeping a great capital city working and moving, 24/7, 365 days a year. These were the narratives through which April’s Foundation Forum looked at the nature of outperformance – is it born, is it made, how do you get to it? These questions of course go to the heart of performance management, whose literature is nearly as extensive as that on leadership.
Are there commonalities between endurance rowing, extreme safety and maintaining a complex human entity in perpetual motion? It turns out the answer is yes: different as the achievements are, as intriguing are the denominators that the Forum teased out as the speakers filled the gaps that the ‘exam question’ begged: fundamental questions about discretionary effort, motivation, and how and why people work together in organisations for common aims.

In his investigation of the chemistry of ‘great groups’, leadership guru Warren Bennis wrote that super-performers believe they are ‘on a mission from God’. Being British, forum speakers didn’t put it like that. But without prompting each made abundantly clear that shared purpose and the meaning derived from it were central to what was achieved. Imagine sharing a tiny privacy-free vessel 24 hours a day for months at a time, the euphoria shot through with episodes of exhaustion, boredom and terror, on an enormous empty ocean. It would be inconceivable without a vision to keep a team strong and stable, to coin a phrase, under extreme pressure the personalities, backgrounds and motivations of the six women were different – but ‘as long as we had that shared vision and purpose, there was a unifying factor’, said Natalia Cohen, one of the ‘Coxless Crew’.

For the newly privatised NATS, formerly National Air Traffic Services, it was the ‘impossible’ challenge of reducing riskbearing air misses from the previously accepted level of 20 a year to zero that galvanised the management team and, after some considerable soul searching, agonising around whether it was achievable or not and whether that mattered or not, aligned it behind a compelling purpose, said Fergus Cusden, NATS Safety Director at the time.

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Meanwhile TfL’s challenge is presenting a unified face to the public with a workforce of 100,000 of whom 75,000 are employed by suppliers and franchised bus companies and only 25,000 are direct employees. The visual unifier is the famous LT roundel that is part of the uniform. The roundel represents the purpose that binds them together – a purpose that is not transport as such, emphasizes Vernon Everitt, TfL’s Managing Director for Customers, Communication and Technology, but rather the end to which transport is the means, that is the daily challenge ‘to keep London working, moving and growing [at the rate of two full tube trains of new people a week], and to make life in the city better.’

“Performance is dependent on knitting individuals into a team”

Any sports follower knows that star talent, while charismatic and an aid to ticket sales, doesn’t translate directly to winning on the pitch. Poor systems turn geniuses into idiots – as systems guru Peter Senge lamented, ‘how can a team of committed individuals with individual IQs above 120 have a collective IQ of 63?’ Conversely, a brilliant system can perform way above the sum of the individual parts. You’d probably want an air-traffic control system to work like Toyota, where installing a new Chairman excites as much notice as changing a lightbulb, rather than as a collection of clever temperamenta individuals.
Everitt spoke for all the speakers when he noted that ‘the working environment lends itself most heavily to actually producing the types of behaviours that organisations want to suit the needs of their customers’; which in turn suggests that ‘the key for leadership is to create the conditions to enable people to do the right thing – not with a manual from head office but just intuitively know what the right thing is – for the organisation’. And then trust them to do it.

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An energised and engaged staff rose brilliantly to the occasion in the 2012 Olympics, ‘where, in the minds of many, we were the only people left who could screw it up’. More dauntingly, ‘no one told the staff at Westminster Station what to do on the day of the recent attack. There’s no manual for it. The staff just acted and did the right thing. And that’s because the management say I’ll tell you what, there’s no point in us telling you what to do you’re the experts, you deal with the situation on the ground’.

Nevertheless, since not everyone can or is willing do everything, outperformance demands some selection, or self-selection, for context. Signing up for the purpose is non-negotiable. Whether or not they’d left the riverbank before (‘I’d never rowed before and never want to again,’ insisted Cohen with feeling), members of the Coxless Crew had to want to spend months together traversing the Pacific in a cockleshell. In air traffic control, Cusden noted that only one in 500 applicants makes the grade, ‘because your brain has to work in a specific, rather strange way. So there’s definitely some “found” in there – and that’s the case for leadership as well’.

The ‘finding’ bit isn’t always obvious, however. When NATS leaders decided that zero airmisses was the only goal that made sense, Cusden admitted, they had ‘no idea’ how to get there. It quickly dawned that their focus was the wrong way round. The big story wasn’t how controllers were allowing through 20 air misses a year – it was how 1.999 million times a year they got it right. They were the solution, not the problem, and to fix the real issue they had to be free to say what was really going wrong instead of hiding it. Incident reports soared. ‘An extraordinary amount of data emerged, and suddenly we’re on the same side, right? …So maybe the first question is, are they really the problem, or have you not engaged them in the right way – and actually our unions became a massive strength for us on the whole safety side of things’.

With shared purpose supported by measures that keep people pointing in the right direction, methods adapt as necessary. Thus NATS managed to install a new facility to manage general aviation movements in three months instead of the normal five to 10 years. How? ‘Because we were getting up in the morning to create the space for our people to deliver the solutions’, says Cusden. Over the big picture, NATS went from 20 a year to just one air miss in five years. On the Doris, methods were more personal. Crew members had developed individual motivators to call on when needed. When things got really tough (and 2 hours on, 2 hours off, rowing, 24 hours a day, for nine months, sometimes because of wind and currents going backwards despite the effort to go forwards, is tough), Cohen broke it down to manageable chunks – each two-hour rowing shift, each stroke, being there in the moment enjoying the light and the sea, not looking forward, not looking back.

At TfL, a light bulb moment, said Everitt, came ‘when we realised that the sorts of pain points for our customers are exactly the same pain points for staff, so if you fix one you fix both.’ Oyster and contactless payment are a win-win-win, benefiting customers through ease of use, staff because they are dealing with happier customers, and the organisation by reducing cost. ‘You just find those pain points and you very often find there are wins in it for everyone.’

In three stories of seriously high performance, as noteworthy as what the speakers did talk about was what they didn’t. The conventional language of management was barely used.

“There was not one mention of incentives or money. No one talked of ‘human resources’, ‘performance indicators’, ‘outcomes’ or ‘delivery'”

Rules and regulations were invoked, but to play down their importance compared to principles and doing the right thing.  Each in their different way emphasized the importance of purpose, honesty and the extraordinary results that follow from allowing, even requiring, ordinary people to be themselves.

Cohen summed it up for all of them: ‘For us, we all had the same vision. We worked hard and I suppose we found the magic in the journey. For any team to function at all you need to have an underlying trust and respect, and I think that was evident with the team. We stepped on that boat as teammates and we stepped off as lifelong friends’.

 

The Foundation’s view

What an outpouring of common sense but in a way that is extremely uncommon…  From our perspective and in the context of our work and experiences at The Foundation, three headlines emerged:

  1. ‘Purpose’ can be more usefully framed as getting everyone onto the same side. The importance for any organisation of having an answer to the question ‘why do we exist?’, and for that answer to be more fulfilling than maximising money in some way, is increasingly recognised.  But the more it is discussed the harder it gets to hang on to what it really means – what makes the idea useful not just fashionable.  Fergus described the difficulty at NATS of first saying out loud that they should only accept and aim for zero near misses a year despite the widespread view that this might be impossible.  What if the organisation ended up simply underlining its inadequacy, making everyone feel bad, rather than celebrating the achievement of managing millions of flights a year in exemplary fashion?  But having realised that zero was the only target the team could morally contemplate, they found that sharing it had a wonderfully aligning effect.  The biggest fear for an air traffic controller is that they make a mistake that kills hundreds of people.  Having your employer stand shoulder to shoulder with you and share both that fear and the intent to stop at nothing to avoid it, then open up channels to explore honestly, constructively and in a ‘Just culture’ how to achieve it together meant that now everyone was aligned.  The unions were suspicious to start with, but once they trusted that motives were genuine they too swung behind the work.  Maximising money for one group, shareholders say, pits people against each other.  Achieving something worthwhile, funded by enough money, brings everyone together
  1. Human, common sense ways of working are liberating. Transport for London has nigh on 60,000 people working directly and indirectly across the transport systems of London, and plenty more than that across the country in related activities.  They have people from all kinds of backgrounds and all corners of the globe managing millions of customers and journeys. Those customers’ experiences matter, their journeys need to be effective and timely to keep London running, and everything needs to be safe.  Costs need to be reduced, new technology embraced and unions kept onside.  Potentially a recipe for The Office levels of management contribution.  What Vernon Everitt described though was wonderfully straightforward and yet extremely rare.  Be honest – tell it how it is.  Treat people like adults in explaining the pressures to deliver more while keeping costs down, to use technology to change the ways things are done, to have fewer people working and to change the nature of the job (modern signalling changes the way a train is driven for example).  And let people do things their way, like the announcements made on the tube system and now on buses too – it just matters that travellers are kept in touch, but the style is down to the individual.  Or whiteboards at tube stations with messages of the day that just started happening, and in that awful Westminster moment where the station team acted effectively and as they saw fit in the moment, the whiteboards provided an outlet for solidarity and heartfelt messages of empathy and defiance.
  1. The answer to the question? Perhaps it is that ‘people and teams are found and THEN made’.  Natalia had never even rowed before.  She answered an ad on a website, and went through a series of interviews and tests that were fairly extreme.  But nothing compared to rowing the Pacific.  Did they know they could do it, or were they just the best six from a fairly small pool who responded?  They were very different characters tackling the challenge for a range of reasons, but what made the exceptional possible seemed to be the way they went about it.  Natalia described the 2 hours on, 2 hours off, 24 hours a day, and the 29 foot boat with a smaller-than-single-bed-sized shelter for two people to rest in, but then the way they understood each other, learned to work constructively with their strengths and hot buttons, stayed in the moment enjoying the light, sky, sea and banishing thoughts of the past and future.  They constructed a way of working that allowed the upper end of ordinary to become extraordinary, and this seemed to be exactly what Fergus and Vernon were also describing.  Good people doing great things, lifted by what they shared, the ways they operated and the ways they were led.

 methode%2ftimes%2fprodmigration%2fweb%2fbin%2f63b443ec-b0a1-3b7d-961d-5667ca82914d

A couple more things to add…

If you want to know what the NATS challenge really looks like, this two and a half minute video will make your hair curl and your eyes widen.  It’s also beautiful.  https://www.youtube.com/watch?v=a8CQ29yWvZI

If you want to see and hear a much fuller version of Natalia’s story and the team’s journey, their documentary Losing Sight of Shore is available on iTunes, Amazon and Netflix.  The trailer is here

www.losingsightofshore.com

We would also like to mention that Natalia is looking to share her learning more widely and is keen to do inspirational keynote talks and team workshops of different kinds.  So do get in touch on natalia@nataliacohen.co.uk if keen

Fergus is also happy to share his learning and help in relevant situations, and he’s on fergus.cusden@assuredoperations.com

 

About The Foundation

The Foundation is a management consultancy specialising in growth. We help clients address big organic growth challenges; growing faster, growing into new markets or fending off threats to growth

What these challenges share is the need to influence customer behaviour, but this is inherently tough. Why? Because people in any organisation naturally see the world from the inside-out, with colleagues close and customers distant, and lots of assumptions about how things work that aren’t challenged

We help clients look from the outside-in, re-connecting them with what customers really value (the problem they want to solve, not usually what the client sells), then finding new and better ways to create this value

This means working both as expert advisors and facilitators. The issue with simply gathering outside-in information is that it lacks impact to get senior teams to tackle inconvenient truths in what customers want, and to believe their own organisation can be different

By using ‘Immersion’, personal conversations with customers and leaders of organisations in other sectors who have tackled parts of their challenge, we help teams get round beliefs that stand in their way. This helps them develop better answers for customers and new ways of achieving lasting success

We most often answer three questions:

  1. Developing new propositions
  2. Improving customers’ experiences
  3. Developing customer-led strategies for broader issues such as increasing retention or lifetime value

Our clients include HSBC, JLR, O2, M&S and Ebay, with achievements including helping create Plan A at M&S, adding £100m of value to a Travelex travel money proposition, and giving Morrisons a competitive direction contributing to their return to growth

Behind our work our most distinctive characteristic is our team and their outlook. Each individual is motivated to and experienced in crossing the border between the worlds of customers and business which often resist mixing well

This link will take you to more information about us and our Forum events: http://www.the-foundation.com

 

Contact Details

Charlie Dawson (Founding Partner):
cdawson@the-foundation.com / +44 7785 268 859

Terry Corby (Partner)
tcorby@the-foundation.com / +44 7446 173 137


Innovate or Die A challenge for specialists or crucial for all?

THE FOUNDATION FORUM

23rd February 2017. Written up with the help of Simon Caulkin.

To download a PDF, click here: Innovate or die – a challenge for specialists or crucial for all?

Innovate or die, apparently. And many organisations seem to choose the latter. Not consciously of course, but as a by-product of finding it so hard just to be big. Most people spend most of their time making sure what’s planned to happen is what happens in practice. There’s precious little left for finding a better plan.
Given innovation is crucial and it’s largely badly done (UK productivity figures make the point all too eloquently), we thought we’d shine a trio of lights on the issue and see what that told us about how to improve.

  • We had Julian Birkinshaw, Professor of Strategy and Entrepreneurship at the London Business School, where he is the Academic Director of the Deloitte Institute of Innovation and Entrepreneurship. He recently co-founded the Real Innovation Awards alongside Management Today with the stated aim of showcasing the authentic, haphazard and, as a result, exciting business of real innovation
  • We had Mark Evans, Marketing Director at Direct Line, where a determination to steer clear of the price fighting aggregators led to the only alternative, innovating to create something worth paying more for. A search for wow factors and a deliberately grown capability in digital technology have led to a business enjoying rude health in a market with a heavy dose of flu
  • And we had Scott Cain, a leader at the Future Cities Catapult, with the challenge of nudging a whole country into more innovative action to make our cities work better by becoming smarter. When you stop for a moment to think how many organisations have a view on how cities work, and competing views on how they might improve, you realise this is the mother of all pieces of string to push and a serious motivation and co-ordination challenge

According to the ONS it takes a German worker four days to produce what we make in five. In the time a British worker makes £1, a German worker makes £1.35. Unsurprisingly the average British worker toils away for longer, in return for lower pay, than their German equivalents. No wonder they get to the sun loungers first. Their towels are thicker too.

But to be fair everyone, even the Germans, finds it tough to make new things happen in large organisations

And good new things are rarer still.
At the heart of the conundrum is the need for innovation (which starts small) to make a significant difference (which means big).

At the beginning end of the equation, having ideas, it seems self-evident that a focused group of people intent only on finding new and better ways will get a great deal further than an army marching in step on a route that’s prescribed trying a bit of juggling on the side. But later on, when the small team of lateral thinkers has something that works, they find they have a serious persuasion job on their hands, and a question or two about whether their baby can survive a serious growth spurt without losing its essential but delicate brilliance.

This is only one way that specialists have been tried. We’ve also had corporate accelerators that became all the rage at about the time of peak beard. And catapults are another example of a specialist team, in their case taking raw potential from academia and building bridges to the commercial world and issues that society needs solving.

But maybe this is all a distraction. Maybe innovation never really takes hold unless its everyone’s job, front and centre, what we do all day. When a business or a charity or a government gets a serious challenge under its skin, a sense of purpose that is authentic and all consuming, then mountains get moved. When Singapore was ejected by Malaysia and found itself becoming a nation state in 1965 it was assumed to be ‘non-viable’. Economic development wasn’t nice to have, it was critical, and 20 years on it was thriving with unusual approaches to tax, education, chewing gum and more.

pexels-photo-123318

When something’s burning, most often a platform but sometimes an ambition to go further, faster, to win and to prove people wrong, then a whole body of people spend their time on improvement. Necessity really is the matriarch perhaps?

But where are the matches kept? if you’re somewhere that’s comfortable, at least on the surface, how do you create the urgency that seems to be needed?

The Real Innovation Awards took a more bottom-up approach to understanding. It’s a scheme that’s kicking back on some of the neatness above. The assumption behind them was that, for such a crucially important process, innovation is badly served by awards that largely describe a simplified, sanitised and inaccurate view. The belief was that real innovation is messy, more uncertain, and more serendipitous than most believe. And the first winners’ stories, which we at The Foundation enjoyed playing a small part in helping choose, bear this out.

So many thoughts, so much familiarity, serious importance and a need for some guidance.
So to the discussion itself – three views, plus wisdom from around the room, on how to innovate not die.

How do we do innovation?

It’s a question that has worked its way steadily to the very top of the economic agenda. At national and international level, fading innovation is one important reason why some leading economists foresee a period of global secular stagnation as the long era of growth comes to an end.
At firm level, the same innovation drought has left large incumbent firms across a swathe of industries perilously vulnerable to disruption from digital-savvy insurgents with massively more efficient business models.

And without a jolt from innovation, a public sector confronted with the need to do ever more with ever less faces a future of near permanent austerity.

Yet as a crowded February Forum heard, innovation, like the Holy Grail, is fervently desired, difficult, mysterious and often tantalisingly out of reach. There are a number of reasons for this elusiveness. One is that although the need to innovate seems obvious, setting out to do it in the abstract, like deciding to paint a masterpiece, is meaningless. There must be something to drive and shape it – a purpose. While there are good negative reasons to innovate (change will overwhelm you if you don’t), as Mark Evans, marketing director at the Direct Line insurance group, put it, the positive imperative for innovation is purpose, in its hard-edged sense of ‘having a legitimacy for your business in the future.’

Five years ago, he recounts, Direct Line was a broken brand (part of RBS) in an industry that, having spent the last two decades talking only about price, was absolutely ripe for disruption. Actually, the pivotal insight was hiding in plain sight: ‘blow me, it’s not a point of purchase thing, it’s point of need: insurance is about fixing things, putting things right. How could we have lost that category insight for 20 years?’ Then it was a question of going back to marketing 101 ‘and saying, we have a better mousetrap, we do insurance better. We do it at point of need and we differentiate ourselves that way’.

A 40 per cent rise in the motor insurance business last year is proof of the pudding. Thus emboldened, and in line with its purpose of ‘protecting an ever-changing Britain’, and the principle of prevention, it has launched eye-catching innovations like a ‘Shotgun’ app which rewards safe young drivers with pizza and coffee during their first 1000 miles when they are most accident-prone, and ‘Fleet Lights’, a system of drones to light the way in dark streets.

 

capture
A second reason why innovation is elusive (one dear to the Foundation’s heart) is the difficulty of maintaining a customer focus. Most organisations look at the world from the inside out, through the prism of their boardroom or their product or service, rather than from the outside in, through the eyes of the customer. Even if you can maintain this unnatural stance, it’s easy, as LBS’s Professor Julian Birkinshaw pointed out, to pay attention to the wrong kind of customers or misinterpret what they are saying. ‘What we’re trying to do of course is to get to the unarticulated views – what is the underlying thing that the customers need but they don’t actually know quite how to express, what is the underlying ‘job to be done’?

This means much real innovation is a gamble based on guesswork (‘unreasonable conviction based on inadequate evidence,’ as Tom Peters once put it) – gambles often don’t sit well with shareholders or those with a vested interest in the status quo. Mark speaks feelingly of the internal ‘vitriol’ that was directed at Marketing as a result of suggesting, then pursuing, bold and unusual initiatives. Not surprising, then, that for every Direct Line that cracks it, there’s a Kodak or Nokia that can see the tip of the iceberg ahead, but can’t change direction fast enough to avoid the hidden bulk below.

Further blurring the issue for would-be innovators is the widespread assumption that never mind the question, the answer is technology. For Scott Cain, who leads on business and project development at an organisation called the Future Cities Catapult, ‘where innovation fundamentally failed over the last 10 years or so, it’s primarily because people are saying I’ve got this great big technology hammer and I just need to find that available nail and keep on hitting with it.’
Thus in his field there is a plethora of vibrant, exciting technologies for making cities smarter or more liveable, to the extent that city authorities are overwhelmed by the proliferation of choice. But features don’t necessarily translate into benefits – particularly in complex entities like cities, systems of systems where each has knock-on effects on others so that it’s hard to establish reliable evidence of what works or work out a viable business model between them.

Again, purpose is key. When Dubai in 2014 decreed its aim of being the smartest and happiest city in the world (by 2017), it approached the Future Cities Catapult to establish just what that meant in context and how technology could contribute to its achievement. The city state has now worked through the first set of projects from the findings and is into its second.

Finally, most organisations are good at either being efficient (‘exploitation’) or being inventive (‘exploration’) – and for all the reasons above exploration is the road less taken, which of course makes it all the more desirable, and essential.

But innovation-driven companies such as Apple, or Intel in semiconductors, that exhibit this drive are rare. Those that don’t have it in their DNA and have to summon up the impetus from elsewhere. Evans calls it a ‘groundswell’, a combination of pride and striving to do the job better, that Direct Line has channelled into an ideas lab that yielded 3000 suggestions in its first year.

Organisations should focus on areas they are competitive in – ‘not necessarily Real Madrid or Bayern Munich; Arsenal will do,’ says Cain – and where something is broken, or markets are not providing a good solution. Internally, a burning platform, as at Direct Line, may be the stimulus to get things moving. The timing needs to be right – innovating too far ahead of customers is as bad as being too late. And while scaling up is a huge issue in itself, ‘the way it becomes a bit more viable is to start at the smallest scale you want to be operating at’, counsels Cain. ‘Start at the very, very human scale, that’s my insight’.

Unsettlingly, innovation isn’t primarily a matter of cold management reason. On the contrary, cautions Birkinshaw, big data and analytics can be bad for innovation. With information everywhere and research costs approaching zero, marshalling data can take only a company so far. (In any case, most of what we call disruptive innovation is actually emergent: the disruption only becomes clear after the event.) So it’s avoiding the trap of over-analysis with decisive action and emotional commitment that are the key to successful innovation, Birkinshaw argues: ‘When we look at the Facebooks, the Amazons of this world, the companies that succeed are the ones that know when to stop gathering information and when to start actually acting on a little bit of intuition’.

This puts a premium on leaders with the wit and courage to make the important calls (and knock some heads together if necessary to bring the talking to a stop) – and on the cussed, unreasonable people, sometimes lower down in the organisation, who make it their business to provoke, stir up the status quo and go on asking the uncomfortable questions until they are either kicked out or get their way.

On the people, in fact, for whom the phrase ‘innovate or die’ has a literal meaning.

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The Foundation’s view

Three points most starkly stood out for us from the evening, complementing Simon Caulkin’s summary.

  1. Diversity matters. And in a substantive way. Mark Evans shared his belief in Neurodiversity, a hitherto unrecognised version referring to people who literally have different brains. Dyslexia, dyspraxia, colour blindness, autism and plenty more lead to very different ways of seeing the world, of drawing conclusions from it and of having ideas. If you want to look round corners that usually get in the way, ensuring diversity of thought and style matters, in version 1.0 gender, ethnicity, sexual orientation and the like, and in this version 2.0 way as well (as he described it). What also emerged less intentionally was a rather masculine way of describing the qualities needed to succeed with innovation, and cajones along with their Anglo Saxon counterparts were referred to several times, and called out by one of our questioners too. It was a sobering moment and showed how less visible things like language matter when discussing and framing issues, opening up or closing down options unconsciously
  2. Innovation is no way to have an easy life. All the way through the examples that were shared, unreasonable people were the ones who had to put up with the slings and arrows on their way to outrageous fortune. Mark described the vitriol that was directed his way as a result of suggesting then pursuing bold and unusual initiatives in the insurance business, like helping young drivers have a ‘shot-gun’ riding alongside them, coaching them towards safety and away from £20m claims that result from disfiguring best friends in all-too-common accidents. There are more or less challenging styles that go with being unreasonable, but relentlessness and unshakeable will are at the core, and ideally these people need some air-cover and space, so they can work through the process of ruling out all the wrong ways to do something towards the right way where the pot of gold lives
  3. Well-meaning collectivism is an enemy. Well-meaning collectivism is fantastic for many many things and would ideally be far more common in the world of work. But innovation is not one of them. Ask enough people and someone will find a reason to say no, or a sensible suggestion to modify, or to test a bit more carefully. Benevolent dictators made their presence felt, labelled, like unreasonable people, by Julian Birkinshaw and described by him at places like Oracle (Larry Ellison – we are moving to cloud, no debate) and by Scott Cain in cities like Dubai where interestingly the person in question was female (we want to create the world’s happiest City, and we’ll do it by a week on Tuesday – well, three years, but you get the idea). This kind of unarguable direction can also come from a deeply held purpose that gives direction and conviction that something matters to everyone involved. Direct Line now has a belief in being fixers, there to put things right when insurance is called on, and people across the business are in action with their interpretations like delivering a replacement TV in person because otherwise it wasn’t getting there before a crucial boxing match that a customer desperately wanted to see

 

About The Foundation

The Foundation is a management consultancy specialising in growth. We help clients address big organic growth challenges; growing faster, growing into new markets or fending off threats to growth What these challenges share is the need to influence customer behaviour, but this is inherently tough. Why? Because people in any organisation naturally see the world from the inside-out, with colleagues close and customers distant, and lots of assumptions about how things work that aren’t challenged.

We help clients look from the outside-in, re-connecting them with what customers really value (the problem they want to solve, not usually what the client sells), then finding new and better ways to create this value This means working both as expert advisors and facilitators. The issue with simply gathering outside-in information is that it lacks impact to get senior teams to tackle inconvenient truths in what customers want, and to believe their own organisation can be different.

By using ‘Immersion’, personal conversations with customers and leaders of organisations in other sectors who have tackled parts of their challenge, we help teams get round beliefs that stand in their way. This helps them develop better answers for customers and new ways of achieving lasting success.

We most often answer three questions:
1. Developing new propositions
2. Improving customers’ experiences
3. Developing customer-led strategies for broader issues such as increasing retention or lifetime value Our clients include HSBC, JLR, O2, M&S and Ebay, with achievements including helping create Plan A at M&S, adding £100m of value to a Travelex travel money proposition, and giving Morrisons a competitive direction contributing to their return to growth

Behind our work our most distinctive characteristic is our team and their outlook. Each individual is motivated to and experienced in crossing the border between the worlds of customers and business which often resist mixing well

This link will take you to more information about us and our Forum events: http://www.the-foundation.com

2007-10-07 at 23-39-27

Contact Details

Charlie Dawson (Founding Partner):
cdawson@the-foundation.com / +44 7785 268 859

Terry Corby (Partner)
tcorby@the-foundation.com / +44 7446 173 137

 


How fortune favours the old – Unlocking the potential of health, wealth and wisdom

THE FOUNDATION FORUM

23rd November 2016. Written up with the help of Simon Caulkin.

To download as PDF, click here: How Fortune Favours The Old – The Foundation Forum 23rd November

It’s not just Generation X, Y and Z that are changing. Generation U, V and W, as they were never known, are also busy re-writing the rulebook.  ‘Retirement’ is retiring, longevity has rampant inflation, it’s coming to us all, yet it’s rarely discussed.

On 23rd November 2016 we gathered to hear four perspectives to shake us out of our ignorance:

  • Charles Handy, one the world’s leading management thinkers, alongside wife and photographer Liz, 84 and 76, bringing a personal view of the key to fortunate old-hood, illuminating ideas in Charles’ recent book The Second Curve, the latest in a series that has foreseen or forecast portfolio working, shamrock organisations and a return to purposeful, human organisation in business.
  • Liz is his life partner, a photographer who only started pursuing it seriously in her mid-40s. Now 30 years later it remains vibrantly at the heart of her life, covering subjects ranging from young entrepreneurs in Tottenham, where the 2011 London riots kicked off, to potato farmers in Ethiopia for an Irish charity.
  • Paul Flatters, founder of The Trajectory Partnership, a futures business with some deep thinking around older age living and a futures business leader with strong views on why we need to wake up to it. Paul’s aim with Trajectory has been to make futures work more useful and less faddy, ensuring the future is better understood, better planned and less feared.
  • Andrew Haigh, long-standing pioneer of Coutts innovative Entrepreneurs practice and thereby advisor to many on life choices and the meaning of fortune. Andrew’s work was a genuinely new approach for a high-end bank, being customer-led by organising not led by the financial value of clients but by the activities that had led to their success. This recognition was followed by a further realisation – that helping people with similar experiences talk to each other, not listen to a banker, was the most useful way for them to learn and find value in their offer.  In the entrepreneurs’ world, much of this was about ‘post-exit’ life, a form of enforced retirement.  Post Coutts, Andrew is now acting on his own advice across an eclectic mix of the arts and business.

 

We’re a sucker for stereotypes and habitually herd-like.  So it’s no surprise we’re locked into looking to youth for our views of the future.  For the last 50 years it’s been the right thing to do.  But while Generation Z is bringing a strong set of values and digital nativity into the world, in many ways they’re more worried about fitting in and getting a foothold than ripping up yet more assumptions.

Meanwhile, at the other end of the telescope something much more fundamental is happening.  We’re leaving behind the idea of working for decades and enjoying a short, leisurely retirement. We’re realising instead that we’re going to have as long post-work as in-work.  Well we would if we had the funds to be post-work.

Funds aren’t the only issue though.  When quantity of life becomes plentiful, outlasting the default content of work and kids, how to we fill our time?  Individually, how do we stay interested and interesting?  And collectively, at a societal level, how do we stay productive when formal employment at large organisations is unlikely to work because they’d end up full of oldies and nobody would ever join or get promoted?

As Charles Handy said to us in discussing the idea, old people don’t cost much – they have plenty of clothes, they don’t eat much and their house is paid for. What’s more important is being useful, doing something valuable and feeling valued. In many ways it’s a step towards happiness and away from GDP, the relative merits of which we have started to debate as we wonder why we seem to be so busy but getting no happier in the process. Maybe this question about later life is a big step in the right direction?

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Or maybe that’s being too optimistic. In this post-Brexit post-truth increasingly strident and decreasingly tolerant world we live in, maybe the old will become resented by the generations straining to make ends meet, working long hours and with debt not pension to accompany them into their own twilight years.

What unquestionable is the degree of change coming down the line, for individuals, for employers, for markets, for society.  And yet it’s little discussed beyond a few familiar platitudes.

Our aim was to put this right.  To get us thinking, giving us insight, foresight and a view of what might be coming down the line.

 

So to the discussion itself – four views on the way we can embrace a happy longer life, individually and as a society

What are old people for? Oddly, no one seems to know.

Scientifically, aging is an evolutionary puzzle. Socially, with some exceptions, most societies treat the elderly as if they were already in the departure lounge, at best with pity, more often with indifference or disdain; historically some even speeded them on their way.  To many in officialdom, as social philosopher Charles Handy pointed out at an absorbing November Foundation Forum on the subject, they are simply invisible.

Age is most considered a disability: look it up and you get a depressing list of frailties the aging flesh is heir to, precious little about compensating pleasure or benefit. One writer begins her book on aging,

‘Getting old sucks. It always has. It always will.’

But more satisfying answers are suddenly now both important and pressing. Up until 100 years ago, with life expectancy hovering at its historic level in the mid-40s, the concerns of the old were a non-issue: there weren’t any. Now, however, societies are aging at the extraordinary rate of five hours a day.

The 85s and over are the fastest-growing age group in the UK, noted Paul Flatters, founder of futures consultancy the Trajectory Partnership. Their number will double to 5m by 2030, and by the end of this century there will be 1.5 million centenarians, up from 13,000 today. At least one-third of those born today will be alive in 2116, according to projections. Techno-utopians in Silicon Valley go further, arguing that just as the first great spurt in life expectancy was triggered by machine power and the Industrial Revolution, so the rapid convergence of robotics, AI and biotech will lead within decades to a ‘cure for death’ and ‘virtual immortality’. ‘[The changes are] not distant stuff. They’re happening now, and it’s moving quite rapidly’, summed up Flatters.

If youth knew; if age could. Getting beyond generational stereotypes to reconcile the two and tap the potential of age is urgent not just because of rising numbers. Of course, intergenerational friction over appearance, dress, manners, drinking habits and taste in music, to name a few, is never far from the surface. But this time, pointed out chairman Charlie Dawson, there is a real prospect of ‘serious grinding of gears’ between young and old. As in other cases, the conflict is amplified by austerity, far-reaching change in the job market and declining social mobility.

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On the one hand the elderly are the heaviest consumers of society’s healthcare and support services, and, as any visit to a care home will confirm, among their number are some of society’s neediest members. On the other, said Andrew Haigh, previously head of client propositions at Coutts bank and now a consultant,

‘Baby boomers have been really good at exercising their power as a generation to accrete wealth to themselves’

– such that over-50s account for fully 68 per cent of UK household income, 77 per cent of financial assets and 66 per cent of property.

No wonder there is a sense of unfairness in the air that runs both ways (a new book just published is called The War on the Old). Today’s young adults are the first generation to be poorer than their parents (although this may be softened by inheritance – ‘all that property has to go somewhere,’ noted Flatters). This, as well as their numbers, means that the old carry real political clout, reflected most conspicuously in the notorious ‘triple lock’ on pensions and political upheaval culminating in last summer’s Brexit vote – which triggered sharp comments about the right of an older generation to decide a future which it won’t live to see for a younger one which will reap the consequences.  Another recent book title, The Jilted Generation, adds a further recriminatory slant.

But it’s more complicated than this.

In their book The 100-year Life, Andrew Scott and Lynda Gratton describe ratcheting life expectancy as a huge potential gift, with the prospect of more experiences, multiple careers, and greater possibilities for self-actualisation. The longer the life the further we can travel. The catch is that life is at least to some extent path-dependent – so its end can equally well turn into a terrible burden. For it to be experienced as a boon – if living to 100 isn’t to mean giving up everything that you want to live to 100 for, as Woody Allen inimitably put it – those living the life have to take charge of it. From now on, people will have to invest in and curate their own lives better, more actively, and from an earlier age than ever before.

For better or worse, many of today’s elders are not starting from there. Consider too that while they are richer, they also face mounting material responsibilities. They must not only provide for their own later (and longer) care and that of their parents – they are also, pointed out Haigh, increasingly playing the part of ‘bank of mum and dad’. So even without the compulsion of a rising retirement age, living longer will undoubtedly entail earning longer, probably with several switches of career: even today’s entrepreneur imagining he or she can cash in with £2m at 40 and retire to the Bahamas may have to think again.

At the same time, people will need to be prepared for many more life changes that in the linear three-stage education-work-retirement trajectory that is now fragmenting before our eyes. ‘With each successive age cohort, life changes that are taking place after 50 or 55 are increasing’, Flatters said.

It’s around those life changes, he added, that many important spending decisions are made. Which is another reason for plucking the old from under their current blanket of invisibility. Their wants and needs will clearly be different from those of younger age groups – the old don’t go in much for fashion, or consume much of anything apart from heat, transport and other utilities, Liz and Charles Handy noted. But even if they become less materially driven with age, older people have other needs for sociability and feeling useful that often go begging because of their invisibility to the outside world.

There are rich business opportunities here, perhaps especially for social enterprises. Consider the Casserole Club, described by Haigh as ‘a 21st century reinvention of Meals on Wheels’. It helps people making food, perhaps for a family, connect with older neighbours, inviting them to make an extra portion and then to pop it round.  It connects people across generations.  Where Meals on Wheels was simply about delivering food on an industrial scape, Casserole Club is as much about social as nutritional sustenance. Yes, it’s a tech-enabled platform that emerged from social media – but it’s one for combatting isolation and developing community, and as such a sharing-economy app that actually deserves the name.

As for individuals, it’s up to the old to decide for themselves who they are and what they are for. With time no longer at a premium, filling it with wall-to-wall leisure and hobbies, the old retirement prescription, suddenly seems less appealing. There’s only so much appetite for golf or cruises. ‘All this doesn’t just happen,’ said Liz.

‘You have to plan your lives – you can’t rely on businesses doing it for you, or the state. You’ve just got to work out what you want in life and take hold of it’.

But take heart. As Dawson noted, Charles and Liz Handy eloquently demonstrated what an older person work and life ethic looks like, why it is important and how to make it happen. When the pair describe themselves as ‘the fortunate old’ and being 80 as ‘the best time of our lives’, it’s a reward for resisting fatalism and doing exactly that. ‘I’d like to think we’re a resource – if people knew we existed. But we try to be useful in our own way,’ said Charles. The Handys boil down the essentials of a good old age to three: work – not necessarily paid, but activity with purpose that gives value and is valued in return; health; and meeting people. Liz described a regime of early morning exercise (a brisk walk) followed by breakfast with a variety of interesting people of all ages – the exchanges at the same time a means of keeping current and connected, and in return of bringing older proportion, experience and connections to bear on life’s challenges.

Perhaps this foreshadows what a second curve for society as a whole might look like: a shift from quantity to quality, from consumption to reflection, from pursuing material success to nurturing relationships.

It may be no coincidence that Japan, which is sometimes called the first post-growth society, is furthest down the line to becoming happily post-youth too. ‘It’s salutary to see – it has an active, aging population, and it’s going to happen here,’ predicted Haigh.

Perhaps the old are ahead of the game. When the actress Shirley MacLaine was asked about the purpose of aging she replied:

‘To learn why you came in in the first place. We are the sole creators of the reality we are pleased with, or not.’

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THE FOUNDATION’S VIEW

As we listened to the assembled wisdom taking shape, and in particular to the Handys becoming heroes of many on the night with their stream of self-deprecating common sense that was at the same time ground-breaking (and rather funny), we observed three big points emerging:

1. CROSS-GENERATIONAL PAIN

There is the potential for serious grinding of gears between younger and older generations.  In this country, people in their 60s and beyond have a hair-raisingly high proportion of the wealth, and our children might be the first to have less than their parents.  The recent Brexit vote saw a strong divide between old & out, and young & in, followed by sharp comments about whose right it was to choose our long term future.  Could this snowball?  There’s a strong overlap with having and not having, being stuck in a shared flat while old folk live in big echoing mansions, being saddled with debt while listening to old people talking about their investments, and so on.  There was a counterpoint put forward by Paul, which is that houses, jobs and other forms of asset need to go somewhere and so adjustment is likely.  The Autumn Statement from the Chancellor prepared the ground for a change to the triple lock on pensions as a topical example.  The point is that the differences are extreme and both generations need to find their voice and take proactive steps to bridge the divide.

 

2. THE INVISIBILITY CLOAK OF AGE

What about realising the potential in our older generation, to be useful, to contribute, to buy things?  Charles described a conceptual challenge from his perspective as an 84 year-old who’s healthy and out there, living life fully, being fortunate, not stuck in a care home which is the stereotype of the generation.  Clearly there are a lot of people in that kind of unfortunate situation, but many more are like Charles and Liz – it’s just that they are invisible.  Charles described filling in a US tax form and finding his birth year, 1932, wasn’t even on the form as an option (being invisible to the US tax authorities was not necessarily a problem he was looking to solve).  In the UK he was called by a social researcher, and on explaining he was self-employed was given options to be in his 40s, 50s or 60s.  On revealing he was 84 the researcher put the phone down.  This matters.  Products and services for this growing, wealthy, cohort won’t be the same as those for people in earlier lifestages.  Material needs are largely satisfied, but social ones, like loneliness, can be tackled in smart ways.  Andrew described the Casserole Club, referred to earlier (https://www.casseroleclub.com/), with the shift from Meals on Wheels to this has been from logistics and function to putting people in touch with people in a way that gives the perfect excuse to say hello.  To get more of this to happen, the group needs to be seen, be thoughtfully understood and provided for.  We have some self-interest in making this happen!

 

3. QUALITY NOT QUANTITY OF LIFE

Given that material needs are small, life is all about leisure, right?  Not so. Charles and Liz showed what an older person work ethic looks like, why it matters and how to go about making it happen.  The aim is to be useful – to be valuable and valued as a result.  The outcome is feeling current and being connected to other people, across generations.  Liz described their routine – up at 7 with a lie-in to 7.30 on her birthday, out for a walk around the woods for reflection and time to talk, then breakfast, often with some ‘interesting younger people’ who can share what they’re doing and some of their challenges.  This allows a bit of perspective to be provided, wisely and calmly, by the older hands, not giving answers but re-framing and making connections too as that’s another benefit of having been around for longer.  This shift from things to time, from achievements to people, is something that society needs more widely too.  The observation that higher GDP is entirely unconnected to higher happiness suggests that maybe here the old are ahead of the pack.  Unlocking the potential of health, wealth and wisdom looks a bit like this?

If you’d like to explore more of the argument around this subject, you could also try a Handy book on the subject, via here http://www.lizhandy.net/charles-handys-books

 

ABOUT THE FOUNDATION

The Foundation is a management consultancy specialising in growth. We help clients address big organic growth challenges; growing faster, growing into new markets or fending off threats to growth.

What these challenges share is the need to influence customer behaviour, but this is inherently tough. Why? Because people in any organisation naturally see the world from the inside-out, with colleagues close and customers distant, and lots of assumptions about how things work that aren’t challenged.

We help clients look from the outside-in, re-connecting them with what customers really value (the problem they want to solve, not usually what the client sells), then finding new and better ways to create this value.

This means working both as expert advisors and facilitators. The issue with simply gathering outside-in information is that it lacks impact to get senior teams to tackle inconvenient truths in what customers want, and to believe their own organisation can be different.

By using ‘Immersion’, personal conversations with customers and leaders of organisations in other sectors who have tackled parts of their challenge, we help teams get round beliefs that stand in their way. This helps them develop better answers for customers and new ways of achieving lasting success.

We most often answer three questions:

  1. Developing new propositions
  1. Improving customers’ experiences
  1. Developing customer-led strategies for broader issues such as increasing retention or lifetime value

Our clients include HSBC, JLR, O2, M&S and ebay, with achievements including helping create Plan A at M&S, adding £100m of value to a Travelex travel money

proposition, and giving Morrisons a competitive direction contributing to their return to growth.

Behind our work our most distinctive characteristic is our team and their outlook. Each individual is motivated to and experienced in crossing the border between the worlds of customers and business which often resist mixing well.

CONTACT DETAILS

Twitter: https://twitter.com/TheFoundation

Website: www.the-foundation.com
Charlie Dawson (Founding Partner):

cdawson@the-foundation.com / +44 7785 268 859

Terry Corby (Partner):

tcorby@the-foundation.com / +44 7446 173 137


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