AMI Consultancy Blog



True Leaders Know the Value of Failure By Stefan Lindegaard

A legendary story about Tom Watson Jr., who guided IBM in its glory days, bears repeating in any discussion about smartfailing.
According to the story, a vice president who had lost the corporation $10 million on an experiment that failed was called to Watson’s office. Fully expecting to be fired, the VP brought along his letter of resignation and presented it to Watson, who refused it with this statement: “Why would we want to lose you? We’ve just given you a $10 million education.”
After hearing those words, how hard do you think that VP worked on his next project…and the one after that…and the one after that? If ever a company president wanted to insure that someone would work his heart out, those were the words to say.
And naturally, as news of this episode inevitably spread throughout the organization, others no doubt from it exactly the message Watson wanted to send: Don’t be afraid to take risks in pursuit of innovation; you won’t be punished if you fail. No wonder IBM dominated the computer industry under Watson’s leadership.
Watson is also credited with saying, “If you want to succeed, double your failure rate.” In this recent post, Tim Kastelle of the Innovation Leadership Network, wrote that he believes Watson meant that we should encourage cheap fast failure. As Kastelle puts it, we should be “testing ideas and finding the ones that don’t work when they are still ideas, rather than things.”



Leading Outside the Lines: Mobilizing the Informal Organization

Right now, the informal elements of your organization are either working for you or against you. Yet for most leaders, say Jon Katzenbach and Zia Khan, authors of Leading Outside the Lines, the informal organization is poorly understood, poorly managed, and often disregarded because it is too hard to think about.

The formal organization has its own way of attracting, selecting, developing, and rewarding people—but it rarely has the power to affect promotion or compensation. Therefore, those who rise to influential positions in the hierarchy are more likely to be more comfortable with and skilled at using the formal organization than the informal….Informal leaders rarely have the kind of explicit qualifications that can be easily documented or communicated, much less evaluated.

The informal organization lies in the human side of the enterprise and as most things that reside there, it is hard. Unlike the formal side with its top-down, rational approach, the informal is fuzzy, constantly changing and hard to measure. So it is understandable that we would like to somehow ignore it or work around it. But, “if you want your entire organization to improvise frequently and energetically in response to fast-moving change, formal management techniques alone won’t get you there. You need help from the informal side as well. Mobilizing the informal organization helps support formal management mechanisms, increasing their chances of success and deepening their long-lasting impact on the organization.”

For leaders, the challenge is to find the balance between the formal and the informal elements of the organization in their particular situation, to achieve concrete, measureable results.

When trying to make a change, our default tactic is to explain “in excruciating detail why the new plan is important.” We think if they get the logic of it, they will get behind it. But they often don’t. People need an emotional connection. Simply formalizing a new set of rules, programs, and structures will not pull the company’s culture along. “To that end, leaders need to be able to translate vision, targets, and strategies into personal purpose, accomplishments, and choices that each one of their people can understand and feel good about pursuing.”

The authors make the distinction that while the formal organization is best when dealing with predictable and repeatable work that needs to be done efficiently and without variance, the informal organization is best suited to unpredictable events—surprises that need to be sensed and solved. They add that in many cases, when activity in the informal organization starts to repeat itself, it “is a signal for broader changes that need to be made to the formal organization.” To move beyond “best practices” and the status quo—to get to “best performance”—a leader needs to learn to mobilize the power and plasticity of the informal.


Are You Working With Energizers or Rotten Apples? By: Robert I. Sutton.

In this excerpt from GOOD BOSS, BAD BOSS: How to Be the Best ... and Learn from the Worst, Robert Sutton tells us about those employees that elevate an office, and those deadbeats and downers that can destroy a company.
Bring on the Energizers
Rob Cross studies social networks: how information, ideas, and influence travel through the Web of relationships that compose every team and organization. A few years back, Rob and his colleagues were designing a survey to map the connections among employees within several big companies. They wanted to identify what kinds of employees were top performers and brought out the best in others. They hypothesized that people who were renowned for having expertise, spreading technical knowledge, and best positioned to gather and weave together information from others would be seen as top performers. At a professional services firm they were studying, an executive argued they were missing something:
We have some of the brightest consultants in the world here. But some are more successful than others, and it has much more to do with what I call buzz than a slight difference in IQ. Our high performers create enthusiasm for things. ... They create energy, and even though this is intangible it generates client sales and follow-on work as well as gets other people here engaged in and supportive of what they are doing.
Inspired by this insight, they added a simple question to their survey: "People can affect the energy and enthusiasm we have at work in various ways. Interactions with some people can leave you feeling drained while others can leave you feeling enthused about possibilities. When you interact with each person below, how does it typically affect your energy level?" The possible answers were: 1 = de-energizing; 2 = no effect/neutral; or 3 = energizing. The colleagues in their team or business were then listed, and each was rated by every coworker.
Rob and his fellow researchers were stunned by how strongly this "energy" question predicted performance evaluations and promotions, and whether people stayed with or left an organization. They also found that the most successful teams and organizations had networks filled with interconnected energizers. Cross and his colleagues have since dug into the kinds of people who are energizers and why they succeed. "Energizers" aren't necessarily charismatic and bubbly; on the surface, many are understated and rather shy. But all create energy via optimism about the possibilities ahead, fully engaging the person right in front of them right now, valuing others' ideas, and helping people feel as if they are making progress.
The late Gordon MacKenzie held a position at Hallmark Cards as "the Creative Paradox." MacKenzie was a successful designer, led innovative design teams, and taught inspiring creativity workshops to everyone from kindergarteners to CEOs. In Orbiting the Giant Hairball, MacKenzie described how he sparked positive energy when he was Hallmark's Creative Paradox:
I became a liaison between the chaos of creativity and the discipline of business. I had no job description and a title that made no sense, but people started coming to me with their ideas, and I would listen to those ideas and validate them. When you validate a person, what you're really doing is giving them power--like a battery charger.
Again, energizers don't need to be bubbly or exciting. When I think of a soft-spoken energizer, Lenny Mendonca comes to mind, a partner at McKinsey who has held senior positions including head of the strategy practice and chair of the McKinsey Global Institute. Before I met Lenny, my stereotype of McKinsey partners was they were smoothtalking egomaniacs. Lenny is exactly the opposite. I remember a great dinner that my colleague Hayagreeva "Huggy" Rao and I had with Lenny at the Half Moon Bay Brewing Company (which Lenny owns). Huggy and I were touched by how encouraging and constructive Lenny had been about research we were pursuing. Huggy, an astute observer, pointed out how closely Lenny listened, how he saw possible value in every person and every idea and-- unlike the two of us--rarely interrupted. Huggy and I are just two of Lenny's fans; he has the same energizing effect on everyone who knows him.


You’re Not the Most Important Person in the Room by Ferdinand F. Fournies

When you are knighted [manager], an invisible sign appears in the center of your forehead and flashes on and off: BOSS … BOSS … BOSS. You can’t see it, but everyone who works for you can. You see lines of people standing around waiting to talk to you. The people who talk to you do it with deference. You notice that your subordinates seem to be concerned about the way they talk to you, but you see no reason why you should be concerned about the way you talk to them. You become aware that when you ask people to do things they do them. After all, they are only there to do your bidding. Quite happily, most of them do so, except the incompetent ones. Because people around you do what you tell them, you become even more impressed with your own importance. But what has happened is that you have become deluded into believing that you are the most important member of that group. Because you believe they need you more than you need them, you treat them accordingly. You get involved in self-destructive behavior. You get lazy and you stop managing; you just keep score.

The sad but true fact is that YOU NEED THEM MORE THAN THEY YOU NEED YOU. You can’t get the job done without them.

Adapted from Coaching for Improved Work Performance by Ferdinand F. Fournies.



Practical Steps for Growing Leaders

  • Reframe leadership as a one-off act that can be shown up as well as down. 
  • Clearly differentiate leadership from management.
  • Upgrade management so it is seen as a supportive, facilitative function.
  • Train budding leaders to focus on content first, influencing skills second.
  • Coach managers on how to foster bottom-up challenges.
  • Reward teams and those who manage them for generating the most useable ideas.
  • Greater chance of winning the war of ideas through faster innovation
  • More fully engaged knowledge workers.
  • More widely distributed ownership for organizational direction.
  • Less pressure on executives to be heroes, to monopolize ownership.