The Debt Collection Company that Helps You Get a Job

Bill Bartmann, CEO of debt collection company CFS2, does things a little differently. Instead of just calling, hounding, and suing debtors to pay what they owe, he calls them "customers" and provides them with free job-search services, such as resume help and interview prep.

Perhaps the reason Bartmann runs his company differently is because he himself has never shied away from living life differently. A high school dropout who later put himself through college working at a hog slaughterhouse, he found himself $1 million in debt himself after his first business collapsed. He clawed his way back up by building CFS, the subject of this HBS case study — but then, that too, imploded. Now he's back (again), and doing things differently (again). What follows are edited excerpts of our conversation.

What's it like running a debt collection company that's so different from the rest of the industry?
It's a little bit like telling everyone that the world is round, when they're still in that flat-earth society. The debt collection industry believes that you have to beat people up to get money out of them — that's in their DNA. 

We all know pleasure and pain are what motivate people, but the debt collection industry has only ever focused on pain. In our company, we've reversed that, and quite frankly it works wonderfully.

Maybe some of the people we work with made bad decisions, and maybe some you wouldn't want to hang out with, but most of them are people like you and me, and they just got swept up in an economic tsunami that literally knocked the blocks out from under them.

You've said the idea came from your employees. How did that happen?

Well, there was this emphasis on litigation by the debt collection industry. We saw that as a train wreck. The banks that sell these loans have so much reputational skin in the game, when the banks become aware of how exposed they are by the tactics of these agencies, we believe the banks will want to change course. So we had decided that we really needed to focus on the pleasure principle.

We knew we needed to be more than just nice, but we didn't know exactly what to do. I went to my employees. I said, "How do we create pleasure for the customer?" This was my plea to 120 employees at a company-wide meeting. What can we do to have them respect us, like us, to "friend them," for lack of a better term, to want to work with us? So ideas started coming from the audience. Some people suggested raise their FICO score, or help them get their credit back, get a credit card. So then we went to test these ideas with our customers: did they want these things? The customers did not. The customers said, excuse the French, "We want the damn phone to quit ringing." It was an epiphany. They didn't want the things we thought they wanted. Maslow's hierarchy? These people were not even on the bottom rung.

So we huddled everybody together again. They said, "The number one problem we hear from customers is that they don't have enough money to pay their bills." We realized if we help them get a better job, they'll have more money. It's one of those really simple things where you wonder, "Why didn't I think of that earlier?"

So how did you take that idea and actually put it into practice?We tried a number of different approaches which didn't work early on. It was mostly advice and suggestions, things of that nature. So we huddled again. And then an employee said, "We're going to have to do it for them. They can't do the heavy lifting themselves — they're so beat down they have no get-up-and-go left." So now we get the customer on the phone, get their info, write a resume for them. We realized we were on to something, and we said, "OK, let's do more of that." We start with a petri dish and if something doesn't work, we don't do it anymore. If something does work, we replicate it.

So tell me about that. How did you take what you'd learned about the resumes and replicate it?

We started doing job interview prep. We put customers on Skype before their interviews, show them what to wear, do mock interviews.

Then we said, "We've got to do more than hope they hear about a job, let's help them find one." So we created a job network. We take their resume and look for openings that fit their skill set. We'd find one, call up the customer, and ask them if it's of interest. Then we'd fill out the application. We'd schedule an interview. And then we would do the mock interview. And then at 8:00 am on the morning of the interview, we call our customer to get them out of bed.

Our success rate has been phenomenal.

How do other companies that are hiring your customers see this? Do they know they're being helped by a debt collection company?

It never comes up. The companies do not know that's how that person ended up there, and nobody really cares where the application comes from.

Were there any surprises you ran into, in implementing some of these ideas?

Not all our customers have the same buttons to hit. We're all different. So one of my employees said, "Why are we trying to figure out what they want; why don't we just ask them what they need?"

Early on, requests came in for food stamps, child care, a new hot water heater, fixing a leaky roof, a new wheelchair. Someone wanted a tree in his backyard cut down. Someone needed a casket for their father's funeral. And we said, "OK, we'll do that."

We've now delivered 203 services that are just as eclectic as you could imagine. In the case of the leaky roof, we called up Habitat for Humanity. The guy who needed a water heater, we called up Salvation Army. Cutting a tree down in the backyard, that was even more simple. We now keep a database of 6,000 agencies around the United States so that whenever we have a customer that wants or needs anything we can find someone who cares about that customer. There are organizations that care about every race, religion, gender, military service, and so on. We care about one person, the customer. So find out everything about who our customer really is so that we can target the organizations that care about some aspect of who they are.

I know you said the point wasn't to have it make money, but I read that you actually do make good money with this model.

This company is only 3 years old, so we're still growing, but our results today are two times that of any peer in the industry. That is shocking. Note to industry: There is a better model.

So what if other debt collection agencies start copying your model? Would that be a good thing? How will you adapt?

First, I hope they do copy my way. I'm not afraid of competition. We really think the world is a better place if we could get every debt collector to follow this model.

Secondly, we think there's enough debt out there that we don't' have to worry about competition.
If somebody catches up to us, that's not their fault — that's our fault. We're first movers, and it's our job to stay ahead.

You know a few things about losing money, as well as making money. Advice for those out there who may be facing down failures, business or otherwise?

Somebody once told me that failure is not final. I thought that was just another cute little cliché thing. I didn't give it much shrift. But then I had the good fortune of failing a couple of times. And here's what I found out: he was right. Failure is not final. It is an awkward, uncomfortable, anxiety-filled portion of your life; it is not your whole life. It isn't who you are, it's what happened to you, and once you get that distinction, then you realize, "I can change that. I can come back. I can do again." Isn't that was capitalism is all about? We have the freedom in America to try anything we want to, and most of them do not work. But entrepreneurs say, "I just want some of them to work."

I really hope I end up being a role model for businesses and businesspeople who failed. Then I would look back at all of my failures and scuffed knees and bruised elbows and know it was worth it.

The Debt Collection Company that Helps You Get a Job
Sarah Green

12 Not-to-Miss Quotes That Help You Go Through a Bad Day

Did you have a bad day? We do understand that going through a bad day is a really normal thing, but we still need a bit of encouragement from day to day to keep us moving. These famous quotes can light up your day, and hopefully your life because they remind you that the best is just yet to come and the worst things you have come across make you a better man.

1. If you want to change, you have to be willing to be uncomfortable.

2. Enjoy life now. This is not a rehearsal.

3. You never know how strong you are until being strong is the only choice you have.

4. Happiness is not the absence of problems, it’s the ability to deal with them. 

5. Life is never easy for those who dream.

6. If you don’t like the road you’re walking, start paving another one.

7. Failure is simply an opportunity to begin again.

8. Happiness is like a butterfly. The more you chase it, the more it eludes you. But if you turn your attention to other things

9. The only person you should try to be better than is the person you were yesterday. 

10. Worry is a total waste of time. It doesn’t change anything. All it does is steal your joy and keep you very busy doing nothing.

11. Walk away from anything or anyone who takes away from your joy. Life is too short to put up with fools.

12. Because if you keep hope alive, it will keep you alive.

The simplest sentences could have huge meaning; a little sparkle from these quotes could brighten your day. If you would like to see the quotes when you open your eyes every morning, I’d recommend you have the quotes stuck on your bedroom wall. Cheers!

12 Not-to-Miss Quotes That Help You Go Through a Bad Day
Anna Chui

Good Leaders Get Emotional

Much of what comes out of people's mouths in business these days is sugar-coated, couched, and polished. The messages are manufactured, trying to strike just the right tone. Genuine emotion stands in stark contrast. It's a real person sharing a real feeling. When we hear it, we're riveted — for one because it's rare, but also because it's real. Sometimes it's uncomfortable and a little messy. But that's what makes it powerful. No one is trying to hide anything.

We hide emotions in an attempt to stay in control, look strong, and keep things at arm's length. But in reality, doing so diminishes our control and weakens our capacity to lead — because it hamstrings us. We end up not saying what we mean or meaning what we say. We beat around the bush. And that never connects, compels, or communicates powerfully.

Yes, being too emotional in business can create problems. It clouds objective analysis, screws up negotiations, and leads to rash decisions. But in nearly two decades of working with leaders, I've found that showing too much emotion is far less of a problem than the opposite — showing too little.

Emotions are critical to everything a leader must do: build trust, strengthen relationships, set a vision, focus energy, get people moving, make tradeoffs, make tough decisions, and learn from failure. Without genuine emotion these things always fall flat and stall. You need emotion on the front end to inform prioritization. You need it on the back end to motivate and inspire.

Over the last 17 years working with senior teams I've collected a lot of examples of leaders getting emotional — to good end. Here are a few:

"I'm angry that I had to spend 3 hours dealing with a problem that you created — a problem that you should have handled. Don't put me in that position again." Joan, a partner in a consulting firm hated conflict and rarely said things like this. She normally just rolled up her sleeves and took care of problems herself, even if she hadn't created them. Then she got promoted to the head of the Southeast Region. There were too many problems to take care of by herself. Her outburst above and the ensuing conversation was a survival tactic, but it sent a clear message to the partner in charge of the Atlanta office. Don't let this employee staffing issue happen again, and if it does, fix it yourself — before it lands on my plate. It was uncharacteristically aggressive for Joan, but exactly what the situation needed. That was two years ago and the problem hasn't happened since.

"I think most of the ideas on this list are sh**ty...but that one's great. Let's do it." Jamie, the CEO at a biotech company had a reputation for walking the fine line between galvanizing a team and offending them. He shot straight and went with his gut. While he had to clean up messes from time to time, it was never anything egregious. And his approach had a profoundly positive impact on the organization. Everyone knew where they stood with him. And everyone knew that he meant what he said. When he got excited about something, no matter what, he was going to make it happen. His energy and emotion accelerated innovation and execution across the company.

"I'm upset. I'm responsible. I apologize." It was the type of mea culpa no one expected from Jeremy. The COO of a software firm, he had had a horrible relationship for years with Ron, a key product development VP. Finally, frustrated and tired, Ron quit. Within months it became clear that Jeremy had underestimated Ron's impact on his team. It started to fall apart. With Ron gone, Jeremy was able to step back and see that he'd let a small issue create a huge problem. And that his stubbornness was at the root of it. He apologized to the executive team with a tear in his eye. I was there. It was shocking. That's not the kind of guy Jeremy was. In an instant I understood how much he cared about the company and how ashamed he felt. Everyone saw it. Amazingly, he ended up apologizing to Ron and hiring him back.

Often, one of the reasons we don't show emotion is because we're not even aware we're feeling it. We're angry, frustrated, or upset and we suppress it. We're excited, motivated, or inspired and we temper it. We do it without even realizing it. Emotional data seems less relevant in the business world where logical data reigns supreme. But it's not only relevant, It's usually the lynchpin to change and growth.

One further point. It's important to note there's a gender bias around showing emotion at work. I've seen that in the same places where men get labeled tough, passionate, or open, women get labeled bitchy, hysterical, or weak. I find this double standard particularly destructive and insidious because it leads to women's emotions getting dismissed more readily than men's, often at exactly the times where that emotion is most needed — times when no one else in the room is raising the most important points. We all need to stay aware of this double standard and not enable it.

My advice to all leaders is to pay attention to your emotions. At least a couple times a week, stop for 10 minutes and ask yourself, "What am I feeling right now?" Write it down if you can. Keeping a regular journal is a helpful way to understand how you're feeling.

Then pick your spots to let loose a little. Let your emotions out. Let people in. Both are critical to effective leadership.

Good Leaders Get Emotional
Doug Sundheim

How to Reward Your Stellar Team

You've been told that getting the most from your team depends on rewarding and recognizing them collectively. But it's tough to do that, especially when most management systems are so focused on individual performance, undermining the very teamwork you're hoping to encourage. Luckily, you don't have to overhaul your company's evaluation process or pay structure. As a team manager, you can support the right behaviors with things that are in your control.

What Experts Say
A few decades ago, companies were struggling with how to measure and reward individual performance. But in their quest do so, many overreached, says Michael Mankins, a partner at Bain & Company and coauthor of Decide and Deliver: Five Steps to Breakthrough Performance in Your Organization. "The pendulum has swung too far, and now those measures are getting in the way of forming good teams," he explains. At the same time, compensating people for collaboration can be tricky, says Deborah Ancona, a professor at MIT Sloan School of Management and coauthor of X-Teams: How to Build Teams That Lead, Innovate, and Succeed. "The boundaries are often blurry and people work on multiple teams at the same time, making it hard for the manager." Still, both she and Mankins agree, it's worth the effort to get it right. "Rewarding a team dramatically improves not only the team performance but also the individual's experience," says Mankins. Here's how to do it effectively.

Set clear objectives
Team members have to understand and agree on what success looks like. "You need to have some way of assessing the group's performance — a common set of objectives or aspirations," says Mankins. He advises bringing everyone together to discuss goals and metrics. Have them answer the question: What would it take for us to give ourselves an A? "Having this sort of dialogue can be motivational and lays the groundwork for collaboration in an objective way," he says.

Check in on progress
Once the team knows what it's supposed to do and how the work will be evaluated, check in regularly. Pose questions that help the group assess its progress: How are we performing as a team? What obstacles can we remove? You can have this conversation in a meeting or do it anonymously. "Use a service like SurveyMonkey and ask team members to give themselves a collective grade. If everybody agrees that it has been a C week for the team, then you can discuss how to improve," Mankins says. "If you give yourselves an A, it's something worth celebrating."

Use the full arsenal of rewards
Most managers don't have the power to change how salaries or bonuses are handled at their organizations. If you do, be sure to tie a portion of the discretionary compensation to team or unit performance — the bigger the percentage the better. But if you don't control the purse strings, don't fret. There are lots of non-monetary rewards at your disposal. "Think beyond team dinners and social events. Those are just table stakes," says Mankins. Ancona has studied hospitals where administrators put pictures of groups that have drastically lowered infection rates on prominent display to recognize them for a job well done. You can also give your team exposure to senior leaders. "Teams like to be seen as part of a project that contributes at a high level," Ancona says.

Get to know your team
Of course rewards are only motivating if you give the team something it wants. This can be challenging because what makes one person feel appreciated may have no effect on another. Spend the time to get to know your team members and look for things they all value. If you're at a loss, ask them for input.

Focus discussions on collective efforts
Ancona says that many companies include teamwork as a core competency in their leadership development models. As a manager, you can further encourage your people to collaborate by talking about them as a team, not as a set of individuals. Be sure to celebrate successes and discuss setbacks collectively. "The less you talk about individual contribution the better," says Mankins. Instead, praise the behaviors that contribute to the team's overall success such as chipping in on others' projects and giving candid peer feedback.

Evaluate team performance
In addition to completing individual performance reviews, consider conducting a team review as well. Mankins says that companies like Apple and Google have made this part of their formal processes, but you can do it on your own too. Every six months or so, take a close look at the group's progress, noting its accomplishments, where it has succeeded, and how it can further develop. Don't mention individuals in this appraisal but focus on what the team has done — and can do — together.

Principles to Remember

Do:

• Agree on what success looks like
• Bring the group together to discuss progress against goals and how to improve
• Consider doing a formal evaluation of the team

Don't:

• Only think of rewards as money — there are lots of non-monetary perks that people appreciate
• Focus on individual performance — emphasize the team's accomplishments
• Reward your team with something they don't collectively value

Case study#1: Set a team purpose and measure against it
To help launch PfizerWorks, a productivity initiative that allows employees to outsource boring parts of their jobs, Jordan Cohen put together a small team including his two direct reports, Tanya and Seth, and started by devising a collective purpose. Following the advice of David Collis and Michael Rukstad in "Can You Say What Your Strategy Is?" the group worked together to come up with a strategy statement of no more than 35 words. "These were the words we were going to live by and we struggled over every clause," he says. Next, they developed metrics tied directly to their strategy. "We had measures for inputs, outputs, and customer satisfaction, all of which we agreed to," he says. Meeting those goals was a reward in itself because team members could see how their actions contributed. "It was a source of great pride. It made them feel like they could win everyday," he says.

Jordan also found ways to make sure his team members were publicly recognized for their work. When PfizerWorks launched, he stopped going to meetings with senior leaders and let Tanya and Seth handle them instead. They became the face of the program. At a meeting with Gary Hamel, just before the famed management thinker was about to give a speech referencing PfizerWorks at the World Business Forum, Jordan asked if he'd be willing to mention the team by name. He did, leaving Tanya and Seth "somewhere between paralyzed and over the moon."

Case study #2: Let them improve their skills
When Christopher Lind worked at a software company, he led a team of eight people who were responsible for training the company's sales force. Most of them had been with the company for a while, but many didn't have formal skills in instructional technology and design. Still, "I was fortunate that everyone on the team had a strong desire to learn," Christopher says. "They wanted to grow their skillset and familiarize themselves with new technology."

The team made great progress, exceeding every goal Christopher set and then asking for new ones, so when it came time to reward them as a group, more advanced training seemed to be an obvious choice. He purchased a multi-license agreement to instructional design software. "I had spent enough time with my team to know they were eager to expand their experience and technical abilities," he explains. "I knew it could lead to them moving on to more senior jobs," he says. But "I ultimately decided that providing them with a valuable development opportunity outweighed that risk." In fact, he hoped it would give them a reason to stay. And he was right. Several team members told him that his investment, of both money and time, made them feel valued. It also gave the team something extra to work on together.

How to Reward Your Stellar Team
Amy Gallo

Want to Know What Really Makes You Happy? Try Tracking It

Throughout our careers and lives, the big decisions we have to make usually lead back to a single, overriding concern: What really makes me happy? Too often we try to answer these questions without knowing or understanding the real data from our lives. Our self-analysis devolves into speculation or wishful thinking.

Over the past month or so, I've been collaborating with Harvard Business Review to develop a quick self-test to determine individual readiness for understanding your own data through the world of auto-analytics. Auto-analytics is a method of using new self-tracking tools to help answer key professional (and personal) questions: How do I boost my productivity? Am I in the right career? How can I improve my work routines by altering my health habits, like sleep and exercise?

To get a sense of how auto-analytics can be used enrich our decision making, I recommend three distinct approaches:

1. Quantifying reflection is the practice of spending a few moments each evening to rate (or rank) that day on a numerical scale, and also to provide qualitative information on daily activities. This method not only begins to habituate reflection but also creates a repository of personal data to inform decisions on which sorts of behaviors to embrace or avoid.

Author Ashish Mukharji's use of this method shows that we don't have to be a professional philosophers or positive psychologists to think systematically about happiness. For the past three years he's been rating his days on a scale of 1-10, also jotting down some associated thoughts, "a restaurant, movie ... whatever made that day special."

Through this exercise he has learned that his average happiness is a seven and he has uncovered some unexpected sources of happiness. For example, in the experience of accomplishment, "actually getting to a goal" is less apt to make him happy than the process of working toward that goal.

With his personal data in hand, he now resolves his existential puzzles with small, practical interventions — idiosyncratic methods to lift his daily happiness. For instance, no matter how much fun he might be having at night, he retires early to avoid missing sleep, since feeling tired invariably makes him unhappy, according to the data.

2. Theory testing uses auto-analytics tools as a way to quantify happiness in terms of an established model. Take the well-known study on happiness by academic Carol Ryff, which includes a theory of psychological well-being. Ryff posited that well-being could be measured on a model with six factors: self-acceptance, personal growth, purpose, mastery, autonomy, and positive relations with others. Researcher and statistician Konstanin Augemberg decided to test Ryff's theory in this short case study. Using the programmable rTracker app on his mobile phone, Augemberg sampled himself three times a day on sliding scale with a simple question: How happy do you feel right now? He also rated himself at that moment on the six factors in Ryff's model.

After a month, he ran the analysis of his data. "Out of 6 [variables] only 4 turned out to be predictive of happiness; the most influential of those were mastery and autonomy — being in control of the situation and being independent," he found.

A good model like Ryff's may have broad appeal, but as Augemberg's experiment demonstrates, all of its six factors may not be relevant to each individual — an overly complicated model may be likened to a universal remote control with superfluous buttons. Through this experiment, Augemberg was able to remove the extra two components, allowing him to better focus on those factors that, according to his data, directly influenced his happiness. He observes, "n=me, so the model may work differently for others."

3. Experience sampling gently nudges users at random intervals throughout the day to log how they're feeling. Over time, the method creates a detailed happiness dashboard so participants can make fact-based decisions or change their habits based on their numbers.

Auto-analytics tools in this area, like trackyourhappiness, represent a new type of research approach, one that advances both scientific learning and individual progress toward happiness.

An interesting dimension of trackyourhappiness is its measurement of mind-wandering. The tool helps people work out tough questions like this one: As I'm performing a task I consider unpleasant, say collating monthly business travel expenses, is it better to focus on the task at hand or to imagine something more pleasant while mindlessly grinding through it?

To resolve this type of conundrum, users are asked three questions at various points throughout the day: (1) How do you feel now? which they answer on a sliding scale from "very bad" to "very good"; (2) What are you doing?; and (3) Are you thinking about something other than what you're currently doing?, to which they can answer "no," "yes — something unpleasant," "yes — something neutral" or "yes — something pleasant."

After using the tool for a while, most begin to discover through data that they are much more happy when they are focused on the present than when not. As lead researcher Matt Killingsworth's analysis of more than 15,000 users shows, people are measurably less happy when they are mind-wandering, no matter what they are doing. "For example, people don't really like commuting to work very much, it's one of their least enjoyable activities. And yet they are substantially happier when they are only focused on their commute than when their mind is going off to something else," he says in his research presentation.

A possible cause for the negative effects of mind-wandering may be that our minds most often wander to worrisome topics like job stability or declining sales this month. Yet on the flip side, the data also show that even when we are imagining something neutral or pleasant, we are slightly less happy when our mind is diverted from its main task than we are when it is attentive.

Killingsworth sums up: "If mind-wandering were a slot machine it would be like having a chance to lose $50, $20, or $1. You'd never want to play."

Each of the three approaches is really about adding a dose of science, gathering, and acting on data to inform personal change. Whether you're interested in addressing your happiness, your work productivity, or something else important, you can begin this data-gathering process by taking this short assessment.

Want to Know What Really Makes You Happy? Try Tracking It
H. James Wilson

Three Simple Steps: Saving for a Rainy Day

Are you paying your bills as they come in, and not charging more than you can afford? Excellent. Are you socking away money regularly for retirement, perhaps via a 401(k) plan at work? Good. Have you put a hefty sum of money away as an emergency fund? No? Well, that is a problem -- but it's not an insurmountable one. Take a deep breath and keep reading. Here are a three steps you can take right away to turn that situation around.

1. Understand the concept.

First off, let's define our terms. Unless you're independently wealthy, it's smart to have a dedicated emergency fund ready in case disaster strikes. You might lose your job, for example, or experience a costly health crisis. It's easy not to think about these kinds of events, assuming they won't happen to you, but they do happen to some people, and they can wreak financial havoc. (Even a big car repair can throw your finances out of whack if you're not prepared.)

How much money are we talking about? Well, a common recommendation is to have three to six months' worth of living expenses socked away. Notice that there's no one-size-fits-all sum, and even the three-to-six-months rule is rough. If it's easy for you to land a new job whenever you need one, then you might not need to save as much -- particularly if you're in a two-income household. (But imagine a scenario in which one of you is stricken, and the other has to become a caretaker -- both income streams could suffer.) If it takes you a long time to find work, though, or you're just very risk-averse, consider saving even more, such as a year's worth of necessary expenses -- including food, housing, utilities, insurance, and all your other nonnegotiable costs of living.

2. Start saving, and invest sensibly.

Once you start accumulating funds for your emergency account, be sure to keep those dollars in the right place. The stock market, for example, is not appropriate, as it could drop sharply just before you need to withdraw money, leaving you with shrunken assets.

Meanwhile, a 3-year or 5-year CD isn't ideal, either, as it locks up your money and charges a penalty for early withdrawals. Bank accounts or money-market funds are generally good options, though they offer paltry interest rates these days.

One possibility is to keep part of your emergency fund in low-growth safe spots, while investing another portion elsewhere. The safer portion can buy you time while your CD matures, or in a worst-case scenario, you'll pay a penalty but will be able to tap a sizable sum. (Some CDs have no early-out penalty.) You might also opt for some relatively stable dividend-heavy stocks for a portion of your fund.

3. Be creative.

Finally, consider "outside the box" methods to help you fund your emergency savings. Sure, you might take on a second job in order to generate more cash quickly. But you could also hold a garage sale, tighten your budget by cutting out discretionary items, or cancel your gym membership and take up walking or running instead. Spend a little time shopping around for the best deal on your home insurance and car insurance, and you might surprise yourself by saving several hundred dollars. You might immediately park your tax refunds in your emergency fund, too.

If you're without an emergency fund but you're healthy and employed, you're still in a great position to build a fund and be prepared for whatever twists and turns life sends your way.

Selena Maranjian, whom you can follow on Twitter, is a longtime contributor to The Motley Fool.

How to Get Others to See Your Potential

Overcoming people's past perceptions of you isn't easy. When I launched my consulting business seven years ago, I was astonished to find — years later — that acquaintances and even friends hadn't kept up with my career transition. They'd ask about my past work in politics or nonprofit advocacy, oblivious to the changes that had been consuming my life. It wasn't their fault, however. These days, we all have thousands of Facebook friends or LinkedIn connections; it's just not realistic to keep up with everyone's latest developments. But the fact that they weren't aware of my new business meant I was losing out on referrals and potential clients. I realized I had to ensure they took notice.

Of course, you can't just prop someone's eyelids open, A Clockwork Orange-style, and force them to read your white papers or watch your webinars. So how do you get other people to realize, and remember, what you're doing now — and grasp what you're truly capable of?

Create content. As a knowledge worker, it can be hard to demonstrate your expertise to anyone besides your boss. But the Internet — and the ability for anyone to start publishing content — has given us a profound opportunity. Just as a graphic designer has a portfolio she can display of her best logos and brochures, you should be creating intellectual property (blog posts, podcasts, videocasts — even a savvy and professional Twitter feed can count) that demonstrates your expertise. If you've changed careers, or are trying to move up the ladder at your company, others may still think of the "old you." Creating solid content reminds people of your new skills and knowledge (it's hard to ignore it if they see links to your blog posts every day in their social media feed) and enables people to judge you based on the quality of the material you produce, not your past history or credentials.

Leverage social proof. It's a term psychologists love to use — "social proof." Basically, it means that people look to others around them to judge the value of something. (If a book has 1,000 five-star Amazon reviews, it must be good.) So how can you leverage this heuristic to help your career? If you're going to bother getting involved with a professional organization, you should make it a point to take a leadership role, because the social proof of being seen as a leader will have exponential benefits. Alan Weiss, a consultant who was the president of the National Speakers Association's New England chapter in the mid-1990s, thought his business would decline during those years because of the extra volunteer time commitment required. "But to my surprise," he told me, "I did about $250,000 more business. The visibility naturally accrues to you, and even though you don't seek it out, people come to you for interviews and advice. Your visibility grows and your brand grows."

Find a wingman. It's true: no one likes a braggart. But you can avoid the problem entirely, a powerhouse group of researchers led by Jeffrey Pfeffer of Stanford and Robert Cialdini of Arizona State discovered, by having someone else do the bragging for you. "People don't like people who self-promote," Pfeffer told me. "But ironically, even if you self-promote through the mouths of other people, somehow that stigma doesn't get associated with you. It's much better to have someone else toot your horn." If you can afford one, you could certainly hire a publicist. But another option is to find a like-minded "wingman" and take turns promoting each other. At cocktail parties or conferences, you and your friend can make a point of mentioning each other's accomplishments or bringing up conversational topics where your partner excels. It may sound artificial, but it doesn't have to be. Just consider it a chance to help your friend shine — and let him reciprocate.

In a frenetic world where we're all stretched far beyond Dunbar's number (the famed idea that humans are optimized to handle about 150 social relationships), it can be exceedingly hard to get noticed by others — and especially to ensure they're thinking about us in the ways we'd like. But we have to take action somehow, or risk missing out on professional opportunities simply because we're not on others' radars or they don't recognize our skills. By creating robust and regular content, mobilizing social proof, and finding a wingman to help spread the word, we can begin to break through and take charge of our reputation in the world.

How to Get Others to See Your Potential
Dorie Clark

How You Can Benefit from All Your Stress

You are stressed — by your deadlines, your responsibilities, your ever-increasing workload, and your life in general. If you are like me, you even stress about how much stress you're feeling — worrying that it is interfering with your performance and possibly taking years off of your life.

This might sound a little crazy, but what if it's the very fact that we assume stress is bad that's actually making it so bad for us? And what if there were another way to think about stress — a way that might actually make it a force for good in our lives? Well there is, according to new research from Yale's Alia Crum and Peter Salovey, and Shawn Achor, author of The Happiness Advantage.

Let's take a step back, and begin with a different question: What is stress?

Generally speaking, it's the experience — or anticipation — of difficulty or adversity. We humans, along with other animals, have an instinctive physical response to stressors. It includes activation of the sympathetic nervous system ("fight or flight"), inhibition of the parasympathetic nervous system ("rest and digest"), and the release of adrenaline and cortisol. But what does all of that do? In short, it primes the pump — we become more aroused and more focused, more ready to respond physically and mentally to whatever is coming our way.

Kind of sounds like a good thing, doesn't it?

But wait, you say, can't chronic stress make us sick? Can't it take a toll on our immune functioning?

Yes...but there is plenty of evidence that stress can also enhance immunity.

Well then, you point out, can't it leave us feeling depressed and lethargic?

Yes... but studies show that it can also create mental toughness, increase clarity, result in greater appreciation for one's circumstances, and contribute to a sense of confidence built on a history of overcoming of obstacles (which is the best, most long-lasting kind of confidence you can have). So stress is bad, and somehow also good. How can we make sense of the paradoxical nature of stress?

I'll bet right now you are saying to yourself, it's the amount of stress that matters. Low levels may be good, but high levels are still definitely bad. (i.e., What doesn't kill you might make you stronger....but too much stress is probably going kill you.)

The problem with this theory — which was once the dominant theory among psychologists, too — is that by and large, it doesn't appear to be true. The amount of stress you encounter is a surprisingly poor predictor of whether it will leave you worse (or better) off.

As it turns out, your mindset about stress may be the most important predictor of how it affects you. As Crum, Salovey, and Achor discovered, people have different beliefs about stress. Some people — arguably most people — believe that stress is a bad thing. They agreed with statements like "The effects of stress are negative and should be avoided," and the researchers called this the stress-is-debilitating mindset. Those who instead agreed that "Experiencing stress facilitates my learning and growth" had what they called a stress-is-enhancing mindset.

In their studies, Crum and colleagues began by identifying stress mindsets among a group of nearly 400 employees of an international financial institution. They found that those employees who had stress-is-enhancing mindsets (compared to stress-is-debilitating) reported having better health, greater life satisfaction, and superior work performance.

That's already rather amazing, but here's the best part — your mindset can also change! If you have been living with a stress-is-debilitating mindset (like most of us), you don't have to be stuck with it. A subset of the 400 employees in the aforementioned study were shown a series of three-minute videos over the course of the following week, illustrating either the enhancing or debilitating effects of stress on health, performance, and personal growth. Those in the stress-is-enhancing group (i.e., the lucky ones) reported significant increases in both well-being and work performance.

Yet another study showed that stress-is-enhancing believers were more likely to use productive strategies, like seeking out feedback on a stress-inducing task. They were also more likely to show "optimal" levels of cortisol activity. (It turns out that both too much and too little cortisol release in response to a stressor can have negative physiological consequences. But with the stress-is-enhancing mindset, cortisol release is — like Baby Bear's porridge — just right.)

Taken together, all this research paints a very clear picture: stress is killing you because you believe that it is. Of course, that doesn't mean you aren't juggling too many projects at once — each of us has limited time and energy, and people can and do get overworked.

But if you can come to see the difficulties and challenges you face as opportunities to learn and grow, rather than as your "daily grind," then you really can be happier, healthier, and more effective. Maybe you don't need less stress — you just need to think about your stress a little differently.

Heidi Grant Halvorson

How You Can Benefit from All Your Stress

Putting big data and advanced analytics to work

I came across this article which I think is really relevant to any business that has accumulated stockpiles of data about clients, and its operations. What to do with this and how it can be put to good use to identify opportunities.

Below are the key points of the interview 

• Big data and analytics actually have been receiving attention for a few years, but the reason is changing. A few years ago, I thought the question was “We have all this data. Surely there’s something we can do with it.” Now the question is “I see my competitors exploiting this and I feel I’m getting behind.” And in fact, the people who say this are right.

•  I get asked, “Who’s big data for?” And my answer is it’s for just about everybody. There are going to be data-based companies: Amazon, Google, Bloomberg. They’re great companies, and they have a lot of opportunity. But just because you’re not going to be a data company doesn’t mean you can’t exploit data analytics. And the key is to focus on the big decisions for which if you had better data, if you had better predictive ability, if you had a better ability to optimize, you’d make more money.

•  So where have I been seeing data analytics recently? Well, the answer is in many places. Let me focus first on efforts to do better things with your customers. An airline optimizing what price it charges on each flight for any day of the week. A bank figuring out how to best do its customer care across the four or five channels that it has. Allowing customers to be able to ask questions and get better answers and to direct them. All of that is on the customer side of things. And then in operations, think of an airline or a railway scheduling its crews. Think of a retailer optimizing its supply chain for how much inventory to hold versus “What do I pay for my transportation costs?” All of that lends itself to big data—the need to model—but frontline managers have to be able to use it.

•  So what’s the formula or what’s the key success factor for exploiting data analytics? From our work—and we’ve probably talked to 100 people—it always comes down to three things: data, models, transformation. Data is the creative use of internal and external data to give you a broader view on what is happening to your operations or your customer. Modeling is all about using that data to get workable models that can either help you predict better or allow you to optimize better in terms of your business. And the third success factor is about transforming the company to take advantage of that data in models. This is all about simple tools for managers—doubling down on the training for managers so they understand, have confidence in, and can use the tools. Transforming your company to take advantage of data and analytics is the hard part, OK?

•  The bi-modal athlete: The question then is how to build what I’m going to call the “bimodal athlete.” And what I mean by this is, imagine that we go to a retailer and meet its buyers, or to a technology company or consumer company and meet the people that make the pricing decisions, or to somebody doing scheduling. Here you need people that have a sense of the business, and they need to be comfortable with using the data analytics. If you’re good at data analytics but you don’t have this feel for the business, you’ll make naïve decisions. If you’re comfortable with the feel of the business but you never use analytics, you’re just leaving a lot of money on the table that your competitors are going to be able to exploit. So the challenge is how to build that bimodal athlete and how to get the technical talent.

Putting big data and advanced analytics to work 

Make Yourself an Expert

“I don’t know what we’d do without him!” That’s what an executive in a Fortune 100 company recently told us about a brilliant project leader. We’ve heard the same sentiment expressed about many highly skilled specialists during the hundred-plus interviews we’ve conducted as part of our research into knowledge use and sharing. In organizations large and small, including NASA, the U.S. Forest Service, SAP, and Raytheon, managers spoke of their dependence on colleagues who have “deep smarts”—business-critical expertise, built up through years of experience, which helps them make wise, swift decisions about both strategy and tactics. These mavens may be top salespeople, technical wizards, risk managers, or operations troubleshooters, but they are all the “go-to” people for a given type of knowledge in their organizations.

Because deep smarts are mostly in experts’ heads—and sometimes people don’t even recognize that they possess them—they aren’t all that easy to pass on. This is a serious problem, both for the organization and for those who hope to become experts themselves. Several professions build apprenticeships into their training systems. Doctors, for instance, learn on the job as interns and residents, under the close guidance of attending physicians, before practicing on their own. But the management profession has no such path. You’re responsible for your own development. If you wish to become a go-to person in your organization but don’t have the time or opportunity to accumulate all the experience of your predecessors, you must acquire the knowledge in a different way. The purpose of this article is to help you do just that.

A Rare Asset

Deep smarts are not merely facts and data that anyone can access. They consist of know-how: skilled ways of thinking, making decisions, and behaving that lead to success again and again. Because they are typically experience-based, deep smarts take time to develop. They are often found in only a few individuals. They are also frequently at risk. Baby boomers—some of whom have knowledge vital to their companies—are retiring in droves. And even in organizations where key experts are years from retiring, there are often only a few people with deep smarts in certain areas. If they’re hired away or fall ill, their knowledge could be lost. In some fields, rapid growth or geographic expansion creates a sudden need for expertise that goes far beyond employees’ years of experience. Whatever the cause, the loss or scarcity of deep smarts can hurt the bottom line when deadlines are missed, a customer is alienated, or a process goes awry.

This potential loss to the organization is an opportunity for would-be experts. Deep smarts can’t be hired off the street or right out of school. High-potential employees who prove their ability to quickly and efficiently acquire expertise will find themselves in great demand.

So how do you acquire deep smarts? By consciously thinking about how the experts in your organization operate and deliberately learning from them. Of course, you can’t—and don’t want to—become a carbon copy of another person. Deeply smart people are unique—a product of their particular mind-set, education, and experience. But you should be able to identify the elements of their knowledge and behavior that make them so valuable to the organization. For example, a colleague of the expert project leader mentioned earlier described him as an exceptional manager who could effortlessly solve any technical problem and always got the best out of his people. Initially, the colleague said he didn’t know how the guy did it. But, in fact, with some prodding, he could tell us that the project leader motivated his team members by matching their roles to their interests, offering them opportunities to present to clients, and taking personal responsibility for shortfalls and mistakes, while giving others credit for progress. On the technical front, the project leader used certain identifiable diagnostic questions to understand complex issues.

The admiring colleague could have recorded and mimicked these behaviors—but he didn’t. One reason, of course, is that the expert himself had never articulated his approach to project leadership. He simply recognized patterns from experience and applied solutions that had worked well in the past. It was second nature to him, like managerial muscle memory. The second stumbling block was that the colleague was accustomed to having people “push” expertise to him. That’s how school and formal management-development programs work. But in today’s competitive work world, that model isn’t sufficient. You can’t count on companies or mentors to equip you with the skills and experience you need. You must learn how to “pull” deep smarts from others.

The Right System

Let’s look at a specific case, a composite drawn from the many executives we’ve helped to attain deep smarts:

Melissa has been with a large international beer company for more than eight years, having previously worked in a retail outlet that sold its products. She is currently a sales representative, but she has her eye on a regional VP position. In thinking about how to become more valuable to her organization (indeed, to any beverage company), she considers which in-house experts she would like to emulate. George, a general manager who has risen through the ranks from sales, is known as a smart decision maker, an outstanding negotiator, and an innovator. His colleagues say he has a remarkable ability to think both strategically and tactically about the entire business, from the brewery to the consumer, and that he balances a passion for data with in-depth talks with people in the field. In short, he would be an excellent role model.

Not everything George knows is equally valuable, of course. And Melissa does have some expertise of her own. She doesn’t want to emulate George in every way. But she wishes she had his ability to evaluate, work with, and motivate the distributors who serve as the company’s conduit to retailers and, ultimately, to consumers. George knows a lot about distributors because he used to work for them; he started out driving a delivery truck and made his way up the ladder before being hired by the beer company. Still, Melissa isn’t going to work for a distributor; nor would it be necessary for her to experience everything George has. What she needs is to unearth the essential skills that make him so effective with distributors, internalize his insights, and mimic his critical behaviors.

Fortunately, George is willing to share his deep smarts with Melissa, but he has neither the time nor the inclination to make her training a priority. So it’s up to Melissa to figure out how to learn from him. She can take two approaches, which are not mutually exclusive. She can interview George and get him to tell her stories that will provide vicarious experiences. Would-be experts who don’t work alongside their role models typically need to rely on this approach. If Melissa is good at questioning, and George is able to articulate much of his knowledge, she will learn a lot. George might tell her, for instance, the story of how he first discovered the power of sales data to persuade retail store managers to display his brand of beer more prominently.

This process has limits, however. George can’t tell Melissa everything he knows, because much of his wisdom is unconscious; he doesn’t think about it until a particular situation calls for it. Moreover, he’s often unaware of the communication style, diagnostic patterns, and body language that he uses.

How can Melissa learn these things? Through a process we call OPPTY, which stands for observation, practice, partnering and joint problem solving, and taking responsibility. Observation involves shadowing an expert and systematically analyzing what he or she does. Practice requires identifying a specific expert behavior or task that you can attempt on your own, but with supervision and feedback. Partnering and joint problem solving mean actively working with the expert to analyze and address challenges. Finally, when you’re ready, you can take over a significant part of the expert’s role. Along the way, you should deliberately reflect on each experience and internalize as much as possible.

When Melissa asks George to help her, she’s careful to frame his doing so as an opportunity for both of them, since having another distribution expert at the company will mean he’ll have more time to handle other issues. She also promises to structure the knowledge sharing so that it minimizes the disruption to his heavily packed schedule.

Next, she creates an action plan that outlines her near-term and ultimate goals and the steps required to achieve them, along with suggested deadlines. (See the exhibit “Tools for Building Deep Smarts.”) George, and possibly his boss, will need to sign off on it.

As she goes along, Melissa notes what she has learned in a log. It’s tempting to think this is unnecessary work, because we all remember very well what we’ve observed or done, and we assume we understand why experts behave as they do. Keeping a log forces you to check those assumptions. It serves as an accurate record of progress (allowing for the reevaluation of goals if need be) and ensures you’ve learned what you and the expert intended. You’ll want to ask yourself questions like, What was the context of the situation? What did the expert do and why did he do it? What did I do and what feedback did I get? What worked? What didn’t? What should I do next?

In the observation phase, Melissa accompanies George on his regular visits to retail stores. This takes no additional time or effort on his part but is an eye-opener for her. Before they enter the first site, George challenges her: What in the store would indicate that a top-notch distributor is serving it? She sees that he pays close attention to details such as the positioning of products in coolers, pricing relative to competitors, and even how prices are displayed. Melissa also listens when George talks with distributors, noticing how careful he is to speak about the broad advantages of suggested changes and to ask probing questions about operations—for example, about what incentives salespeople are given. His body language suggests empathy; he leans forward and listens intently.

After a couple of months, Melissa is ready to move on to practice what she’s picked up from George. A few months after that, she begins to solve problems jointly with him. When George asks her to help analyze why a particular sales region has high sales volume but very low margins, she sees how useful it is to juxtapose data analysis with visits to the field. She watches George reject a distributor’s insistence on sticking with an unsuccessful strategy because it’s “just the way it’s always been done” and helps him brainstorm three alternative strategies for the distributor. When she reviews the learning log with George, he often comments that he rarely thinks about why he does what he does—but he agrees with her analysis.

You’ll note that Melissa has both the motivation and the discipline to persevere in learning—vital requirements for this process. And George is happy to help her, which is more common among experts than you might think. Many of those we’ve interviewed are willing to share their knowledge—thanks to an intrinsic interest in coaching or because they have incentives to do so, such as a lightened workload, kudos from management, or the opportunity to build new knowledge and find new paths to innovation themselves.

Guided Experience

The system we outline in this article works best when aspiring experts have both time to learn and geographic proximity to the masters who will train them. However, our methods can be applied across distances and compressed in time. The U.S. Army, for example, uses parts of this process to transfer knowledge from officers serving overseas to personnel about to be deployed to the same regions. The transfer of expertise need not be one-on-one, either. An individual can accrue deep smarts from more than one expert, and an expert can mentor more than one individual.

No matter how sophisticated current technologies for data capture and analysis are, we are still highly dependent upon human skills in many situations, and such skills are best learned from experts. There is an old saying: Good judgment comes from the experience of having made bad decisions. But we believe it’s more effective and efficient to build expertise through experiences guided by the smart people around you. If you observe, practice, partner, and problem solve with them before taking responsibility on your own, you’ll soon become as indispensable as they are.

Make Yourself an Expert

Dorothy Leonard, Gavin Barton, and Michelle Barton

Evaluate Remote Workers Fairly

We all tend to trust what we can see. If someone is always in the office early and leaves late, you'd probably assume he is a dedicated, hard-working employee. But he might actually be the least productive of his co-workers.

And that's why numerous experts have advised that companies should avoid management by observation, and instead focus on the actual work itself. But many companies have clung to cultures of "face time," in which staffers who log the longest hours are assumed to be the best employees. I, myself, have been guilty of that bias. Though as telecommuting becomes more widespread and the workplace becomes increasingly virtual, management by observation simply doesn't work anymore. Supervisors can't concern themselves with the "where" and "when" of work. Instead, they now have to concentrate on the "what" and "how."

A number of researchers we talked to have observed that the virtual workplace is imposing a healthy rigor on companies. By focusing on what work is being done and how it's being done, businesses are better able to assess the performance of their employees. The result is that favoritism and office politics are less likely to corrupt the selection of who receives raises, bonuses, and promotions. And laggards can be identified more quickly to receive the additional training and attention they require. But that's the upside. The downside is the difficulty of evaluating the performance of employees who can't be seen.

While some companies like IBM and P&G have become adept at remote evaluations, many businesses are still struggling with the basics. From our numerous interviews and research investigating this topic, we have derived a list of the following best practices.

Don't focus solely on results. Performance should be based on a combination of two things: results and behavior. Both are necessary, says Dick Grote, a well-respected researcher in the field, because management shouldn't reward employees who achieve results but break company policies to do so. (And neither should it reward people who follow the rules but don't produce.) In a virtual environment, managers are often tempted to focus solely on results, because employee behavior can't be seen and is difficult to evaluate. But that's just asking for trouble. Telecommuters and other virtual employees who work in physical isolation could easily be tempted to cut corners. Thus managers must figure out ways to evaluate both the performance as well as behavior of their staffers.

Beware unintended consequences. The natural tendency in the virtual workplace is to rely on various metrics to assess employee performance. But those metrics often lead to counterproductive behaviors. The classic example, says Jim Ware, the founder of The Future of Work, are call-center workers who are being evaluated by how efficient they are in terms of the average length of their customer calls. That particular metric easily leads to workers prematurely transferring or terminating calls without really resolving customers' problems. My friend Tony Hsieh, the CEO of Zappos, has taken a very different approach. He encourages long service calls because he feels they are a sign that Zappos is building strong relationships with its customers. It's hard to argue with that philosophy, given Zappos' success and the company's strong culture of trust and collaboration.

Engage the disengaged. Performance reviews and evaluations often fail because people tend to avoid conflict. They merely go through the motions without candidly speaking their minds. In a virtual work environment, that danger is greater because many telecommuters and other virtual workers already feel disconnected from the rest of the organization. What they don't need is to feel even more disengaged by a review process that makes them passive participants. The solution, says Dick Grote, is to involve them from the start. A manager could ask each telecommuter to submit suggestions for performance metrics that could be used to assess both results as well as behavior. Beyond engaging employees and helping obtain their buy-in, creative ideas often emerge to assess worker performance in better ways. Moreover, the back-and-forth conversation between supervisor and employee about how to assess performance will also set the right tone that the relationship is a two-way street. This sets the stage for greater candor in future discussions so that disagreements can be resolved in productive ways.

Forget about employee self-evaluations. Although employee buy-in is crucial, companies shouldn't make the mistake of thinking they can obtain it simply by having employees do self-evaluations. Even in a traditional work environment, the effectiveness of self-appraisals is questionable. In a virtual workplace, self-evaluations are even more prone to failure because of two types of human bias. The first is that people usually think they are better at their jobs than they really are (called the "overconfidence effect"). The second is that people are likely to take too much credit for good results (called the "fundamental attribution error") and too little responsibility for things that go wrong. Those two types of biases are especially dangerous in a virtual environment, because employees are often working in isolation bubbles without regular feedback.

Level the playing field. As companies accommodate increasingly virtual workplaces, they can easily make the mistake of comparing apples with oranges. Here's how that typically happens. When a department begins to allow telecommuting, management develops a new system for evaluating those workers based on specific metrics. But then it continues to assess the traditional office workers using the old system. The result: people doing the same job are compared as apples and oranges. This can be especially problematic if a "forced ranking" type of approach is used, in which managers do side-by-side comparisons of workers. The danger is that telecommuters will be slighted for raises and promotions because they're "out of sight, out of mind." By using a single performance management system for all employees doing the same job, supervisors can help minimize any natural favoritism toward those who have greater face time in the office.

Performance management systems are one of the toughest things for companies to get right. Even HR folks will admit that the process often leaves much to be desired. In a recent survey [PDF], nearly 60% of HR execs rated their own performance management systems with a grade of just "C" or lower. That's appalling, given that salary raises, bonuses, and promotions are typically tied to those systems. Yet it's hardly surprising because managers are increasingly having to evaluate and assess what they can't see — namely, virtual workers. But, as I have learned over the years, such employees can be evaluated properly even if they can't be observed directly. The trick is to avoid the common traps — like focusing on results at the expense of behavior — that can distort how we evaluate the performance of those we can't see.

Evaluate Remote Workers Fairly

Keith Ferrazzi

No One Likes to Be Changed

Listen to the language that any leader, consultant, or HR professional uses, and you'll hear them expound at length about how "we" need to change "them." That says it all: the fact is, no one likes to be changed, even if the change is ultimately beneficial.

In his recent HBR blog post, Ron Ashkenas argues that the reason most change management initiatives fail is due to stunted managerial capability to implement change. He points out — correctly, I believe — that in many organizations the responsibility for change initiatives has come to rest with HR, and not with the line supervisors and managers. However, I believe that there's a deeper, more fundamental problem with the way we frame the whole notion of change management. In fact, I propose that we dispense with the concept of "change management" entirely. History shows that's a recipe guaranteed to foment fear, resistance, and — ultimately —failure.

Many factors underlie that failure. Research shows that there's actually a decrease in cognitive function when people feel as though they lack control over their work environment. Moreover, repetitive change initiatives — particularly ones that include layoffs — inevitably lead to cynicism and often to a kind of learned helplessness.

A far more effective approach would be to actually involve workers in solving business problems. As Dan Pink writes in his book Drive, the autonomy and skill development that comes with solving problems for oneself will do more to overcome resistance and motivate change than any strategy a cloistered HR professional or consultant can develop. I'm partial to A3 Thinking as a powerful way to solve problems, but the truth is — the tool you use doesn't really matter. The key is to pose a business problem to the workers actually doing the job and then having them design the change. Consider the following cases:

• A group of senior R&D engineers at Abbott Vascular spent six to seven hours each day handling email. They were demoralized and frustrated by their inability to find time to do any engineering. On their own, they developed a new communication protocol that defined when and how to use email (never for urgent or complex issues), and now they can safely unshackle themselves from their smartphones and focus on engineering issues.
• The interventional radiologists at a major cancer center were asked by leadership to lower costs and increase revenue by accelerating room turnover. They decided to standardize the devices (stents, guidewires, catheters, etc.) they use for basic cases. Reducing the variation lowered inventory-carrying costs and enabled technicians and nurses to set up rooms more quickly.
• In her book, Sleeping with Your Smartphone, Leslie Perlow recounts how she set a goal of one day per week of "predictable time off" for a team of consultants at the Boston Consulting Group. The consultants themselves then devised radically different work habits and client communication procedures to make it happen — an initiative that has now been adopted by over 900 teams worldwide.
• A typical Toyota assembly line in the U.S. makes thousands of operational changes in the course of a single year. As journalist Charles Fishman writes, "that number is not just large, it's arresting, it's mind-boggling." Toyota doesn't have change management consultants driving those changes; the workers themselves make them.

In each of these cases, it's easy to imagine how externally imposed solutions by leadership or HR would have been fiercely resisted, leading to lengthy disquisitions on how to manage or overcome employee intransigence. The real secret to successful change, therefore, is not to change people at all. Let them figure out how to solve their own problems, and they'll do the rest.

No One Likes to Be Changed
Daniel Markovitz

The Dirty Little Secret of Project Management

Why don't more project managers sound an alarm when they're going to blow past their deadlines? Because most of them have no earthly idea when they'll finish the job. They don't even think it's possible to know. Too many variables. Too much that's out of their control.

That's the dirty little secret of project management. As the lead developer on one big software project put it: "Everybody knows the schedule is a joke, and we pay no attention to it. It will be done when it's done."

It's funny, though. Big, successful companies that manage huge projects like highways and dams and office parks have to deal with many more variables than a software development team. Yet they usually know how far along they are at any given time, and they keep their customers in the loop. That's how they get to be big, successful companies.

Granted, they have fancy project management software to help them stay on top of the schedule. But a good project management system — one that can tell you exactly where you are in the project, when it's likely to be done, and by how much you will overshoot or undershoot your budget — doesn't need expensive software. At Setpoint, which builds roller coasters and factory automation systems, we used to manage multimillion-dollar projects with a whiteboard and a calculator.

The fact is, your system can be very simple as long as it helps you do the following:

Track key variables. Keep a close eye not just on milestones but also on factors that have an impact on profitability. The biggest variable to watch? Labor hours compared with budget, which gives you a pretty good idea of your percent complete at any given time. You'll also want to track materials costs, change orders, and your subcontractors' progress. Trouble in any of those areas can throw a project out of whack quickly, so it's important to track them on a weekly basis.

Keep your team informed. We recommend regular weekly meetings, with the key numbers posted on a whiteboard or computer desktops so that everybody can see them. With the numbers up there, potential trouble spots surface quickly. A few years ago, we learned that one of our project managers started surreptitiously building extra time into the schedule. If we had let that continue, it would have messed up our profit projections for his projects. Team members brought the issue to our attention after the first weekly meeting — they could see that the numbers on the board didn't square with the agreed-upon timetable.

Update your stakeholders and customers. All customers want their jobs finished on time and on budget — or preferably faster and cheaper. But if they can't have that, and sometimes they can't, what they really want is to be kept informed along the way. (Ditto for senior managers — they don't like surprises, either.) Share bad news as well as good so they're never outraged by enormous last-minute changes.

Here's an example: Setpoint was building a small coaster for a major amusement park company. This was just one piece of a major park upgrade with a very aggressive schedule and dozens of contractors in the mix. As we got deep into our project, we ran into several issues — big (and unanticipated) coordination snags on the jobsite, changes in the specs for riders per hour, and others. We knew these issues would delay the final product by six weeks. So we immediately notified the customer and adjusted our delivery dates months ahead of time.

By the end of the project, we were behind by those six weeks. But because we had kept the customer in the loop every step of the way, we were on time as far as he was concerned. We even got an award at the end for on-time performance. The moral we took away from this? If your customer doesn't think you're late, then you're not late. If you need to change the schedule, do it as early as possible and give your customer an immediate heads-up so he can adjust his expectations.

We're not saying project management is easy. But if you have a good system, you can keep track of the difficulties and keep your customer informed and happy — even if you're six weeks late.

The Dirty Little Secret of Project Management 

Joe Knight, Roger Thomas, and Brad Angus