Workplace, Teams, & Culture

Several recent spectacular management failures call into doubt the ability of nontechnical managers to supervise the complex engineered systems for which they are increasingly responsible. However, the author of this article believes effective generalist managers in technical fields need to understand the risks faced and must sufficiently grasp the technology to effectively "talk the talk" with their staff and colleagues. To accomplish this, he contends that managers should focus relentlessly on key corporate priorities, continuously measuring employee performance to emphasize these crucial metrics. The author also recommends establishing official and unofficial pathways for collecting unfiltered and accurate information -- in particular, by developing a "back channel" of direct personal contact with one or two trusted technical staff with real insight into the unvarnished truth. In the end, the author contends, an insistence on facts rigorously applied, along with a cultivation of a "push back" culture that encourages people to raise concerns must underlie the commitments a technical organization makes. In this way, the author insists, a healthy organization can effectively handle both routine activities and serious crises regardless of who's in charge.

What separates high-performing knowledge workers from their more-average peers? Superior ability is part of the answer, as is superior expertise. But according to the authors, what really distinguishes high performers from the rest of the pack is their ability to maintain and leverage personal networks. The most effective knowledge workers create and tap large, diversified networks that are rich in experience and span all organizational boundaries. Contrary to the popular image of the networker, the authors say, the building and use of such networks is rarely motivated by explicit political or career-driven motives. In addition, they posit that high performers are much more than "social butterflies," who tend to have numerous relationships that don't scratch below the surface. Effective knowledge workers focus on building deeper relationships that will be mutually beneficial over time. The authors discuss the three tactics used by high performers to build and maintain their networks. Ideally, they say, organizations should use tools and readily available human-resources practices to hire people who are likely to develop large, widespread networks. Once on board, people should be encouraged through incentives to maintain their networks. Such important work -- and it is work, even if isn't usually visible -- shouldn't be left strictly to chance.

Between 1991 and 2001, the average number of joint-venture deals announced each year increased from 1,000 to 7,000. Executives are clearly setting great store by these temporary partnerships as a way of achieving both short-term and longer-term goals. As with any type of alliance, however, success can be elusive, and a poor relationship between the partners is often at the root of difficulties within a venture. A negative cycle frequently develops in which poor partner relations lead to poor performance, which in turn puts the partner relations under greater pressure. In the course of her work with executives from joint ventures and their parent companies, the author identified five minefields that can explode and damage the relationships in an otherwise fruitful operation. Since joint ventures are here to stay -- they are still sometimes the only way for a company to enter a new market or to gain access to key technology or people -- managers must learn to avoid the minefields if they are to realize the full potential of these strategic partnerships.

Ongoing innovation is essential for the enduring success of any company in a competitive industry. Innovation comes in two basic flavors: product innovation and business innovation (that is, process and marketing innovation). In technology-driven industries, the primary source of customer value shifts over time from the first to the second as technologies mature and the customer base becomes more mainstream. If technology-driven companies are to make the necessary shift to business innovation, they cannot avoid significant changes in company culture. Waiting until crisis strikes is dangerous. But many leaders avoid addressing cultural challenges early enough because they are uncomfortable with the invisible, difficult-to-measure nature of culture and its stubborn resistance to quick fixes. Early high-tech leaders must inevitably evolve their underlying cultural bias as the driving technology in their industry moves through the creation, transition and commoditization stages of development. Cultural change often requires managers to be jolted out of their comfortable grooves by a disaster. Premeditated change is preferable, but it takes courage and foresight. For the courageous manager, the author outlines ways to proactively guide the development of a company’s culture from one best suited for early entrepreneurship to one capable of enduring industry leadership.

Some business builders in the Internet era have blindly focused on “getting big fast” in the mistaken belief that Metcalfe’s Law applies ad infinitum. The value of a network, in fact, does not increase forever, but there are ways to counteract the forces that put the brakes on network effects.” Around 1980 Robert Metcalfe, the inventor of the Ethernet standard and founder of 3Com, observed that the value of a network increases in proportion to the square of the number of people using it. This observation came to be known as Metcalfe’s Law. It was similar to an idea developed by economists about network effects” & #8212; meaning that some resources become more valuable to a person using them according to the number of other people also using them. At the dawn of the Internet era, network effects became the Holy Grail for many business builders, who wanted to “get big fast” in order to exploit them before the competition did. But Metcalfe’s Law doesn’t always hold, say Harvard Business School professor Andrew McAfee and consultant Fran ois-Xavier Oliveau. As networks become very large, they can fall prey to saturation, cacophony, contamination, clustering and high search costs. Those phenomena mean that larger networks can, in some cases, have less value than smaller ones. The authors have identified several strategies that network builders can employ to maintain network effects or limit their decline. When followed properly, these strategies are more effective than a blind, bigger-is-better approach in which network builders rush to sign up as many users as quickly as possible.

Over the past couple of decades, management innovations have pushed companies toward the ideal of the “boundaryless” organization. As a result of these changes, formal reporting structures and detailed work processes have a much diminished role in the way important work is accomplished. Instead, informal networks of employees are increasingly at the forefront, and the general health and “connectivity” of these groups can have a significant impact on strategy execution and organizational effectiveness. Many corporate leaders intuitively understand this, but few spend any real time assessing or supporting informal networks. And because they do not receive adequate resources or executive attention, these groups are often fragmented, and their efforts are often disrupted by management practices or organizational design principles that are biased in favor of task specialization and individual rather than collaborative endeavors. The authors initiated a research program two years ago to determine how organizations can better support work occurring in and through informal networks of employees; they assessed more than 40 networks in 23 organizations. They discovered in all cases that the networks provided strategic and operational benefits by enabling members to collaborate effectively; they also found that managers, if they truly wanted to assist these groups, had to overcome six myths about how networks operate. In this article, the authors explain the six myths and why they are harmful; in place of these assumptions, they offer reality checks that can be implemented to help networks become more effective. Senior managers who can separate myth from reality, and act accordingly, stand a much better chance of fostering the growth and success of these increasingly important organizational structures.

Traditional teams are not faring well in today’s rapidly changing business environment. Even when they establish clear roles and responsibilities, build trust among members and define goals according to the book, their projects often fail or get axed. Three MIT Sloan School researchers think they have found the reason: Traditional teams are too inwardly focused and lack flexibility. Traditional team-building activities are still important, they contend, but only when combined with a greater awareness of external stakeholders and information sources. Fortunately, a new, externally focused team has arisen: the X-team. The authors detail the high levels of performance that X-teams are seeing. And they explain how managers in a wide variety of industries and functions can establish the organizational structures that support such teams. The researchers outline the five components of X-teams they have studied: external activity, extensive ties both inside the larger organization and outside the company, expandable tiers or kinds of responsibility, flexible membership (switching roles, moving in and out of the team as needed) and execution mechanisms that facilitate getting the job done. The results are impressive. One observed X-team greatly improved the dispersal of innovation throughout its organization. X-teams in sales were seen to bring in more revenue. Drug-development teams were more adept at drawing in external technology. Product-development teams were more innovative than traditional teams & #8212; and more often on time and on budget. Managers that recognize their own company in the new, flatter organizational structures, the increasing interdependence of tasks and teams, the constant updating of information and the overall complexity of work should consider creating an environment for successful X-teams.

Strategic alliances are assuming increasing prominence in the strategy of leading firms, large and small. Yet many alliances fail to meet expectations because little attention is given to nurturing the close working relationships and interpersonal connections that unite the partnering organizations. This case study follows the strategic alliance between two Fortune 500 firms (referred to as Alpha Communications and Omega Financial Services) as they developed a cobranded product. It explores the social architecture of the alliance and identifies the communication patterns that united the participants & #8212; and the beliefs that divided them. The researchers gathered data from the entire network of alliance participants, including the core team and a cadre of senior executives in the two firms. The result is a vivid and comprehensive portrait of the intricate web of relationships that formed in this alliance and the flow of communications within and across the partnering organizations. The interviews in the study revealed, for example, that fears of ulterior motives preoccupied managers on both sides, leading to a lack of trust. There was also a perceived imbalance in the degree of importance that each partner assigned to the alliance. One appointed senior managers, the other lower level managers, which led to significant pacing issues. Although managers in both firms agreed that the alliance made sense, inattention to the inner workings revealed bothersome incompatibilities. The firms’ different personnel structures also contributed to high levels of frustration. Omega used a centralized approach to control the outward flow of information, whereas Alpha used a decentralized approach. The researchers’ findings suggest that positive personal connections are crucial to the success of a partnership. Initial negotiations and senior management advocacy set the tone for the alliance, galvanizing support and promoting effective interpersonal ties. A well-integrated communication and work-flow network is required within and across the firms, so firms must carefully select team members who will match in rank and specialization those from the partnering organization. Regularly auditing the evolving ties between the organizations is valuable in gauging alliance health.