How to Work Less And Achieve More

Posted on by The Economist Executive Education Navigator

In the U.S., the 40-hour work week actually averages 47 hours, according to a Gallup poll. Specifically, salaried employees average 49 hours of work per week, and 50% of them work anywhere from 50 to over 60 hours weekly. Even when workers are off, they tend to be tethered to their digital devices, responding to work-related phone calls and also text and email messages.

Employees at every level report stress and increased work demands, and a variety of issues are causing executives to be sleepless in the C-suite.

Working harder, however, is not the answer, according to Morten Hansen, management professor at the University of California Berkeley and co-author (with Jim Collins) of “Great by Choice.”

Hansen conducted a five-year study of more than 5,000 managers and workers, and discovered the reason some people perform better at work than others. His findings form the basis for his new book, “Great at Work: How Top Performers Work Less and Achieve More,” which is one of 11 leadership books recommended by The Washington Post for 2018.

We asked Hansen to share a few findings from his book.

Working harder isn’t the key to improving performance

In the classroom and the workplace, there’s a tendency to think that an increase in effort leads to an improvement in performance, but this is not necessarily the case.

“The working hard model is like squeezing an orange,” Hansen says. “As you improve the number of hours and you go from 30 to 40 hours, it will increase performance, but then you keep squeezing to get to 60 hours.”

At this point, your efforts are counterproductive.

“There’s less juice, and you’re getting less quality and you’re actually detracting from your work,” he explains. “At some point, there’s only pulp coming out and you’re getting diminishing returns.”

Hansen’s study of 5,000 people in corporate America found that going from working 30 hours up to 50 hours does indeed result in an improvement in performance, but, he explains, “from 50 hours to 65 hours, the curve is flattening quite a bit, and at 65 hours, it starts going down.”

So, while working harder seems to be the ethos of our workplace culture, Hansen warns, “the evidence does not support this and top performers don’t do this.”

The disadvantages of working harder

An increase in workplace effort deceives both employees and leaders into thinking that they are working hard because they are working more hours. But, they’re actually doing something else.

“You start ruining your life because your work is really encroaching on your private time,” Hansen explains.

If you work 50 hours per week, he says you’re dedicating 10 hours per day to your job—and even if you’re just checking emails or making phone calls from the convenience of your home, he says you’re still working.

“This is a severe tradeoff—you’re willing to sacrifice a part of life thinking it is going to make you more successful and the evidence is that it is not,” Hansen explains.

“Believe me, I’ve been guilty as well: when I graduated from college, I was working 60 or 70 hours a week.” But then, he says that he met colleagues who were performing at a higher level even though they were working fewer hours.

How leaders and employees can work smarter

“Work smart, not hard” has become a common workplace phrase, but Hansen doesn’t think most people really know what that means.

“It’s become a cliché, and obviously, no one wants to work dumb.” But, if people don’t understand how to work smart, not hard, there’s no way they can make the necessary adjustments.
His first recommendation is to be selective about what you do.

“It’s about having the ability and willingness and courage to really focus on the very few things that matter the most.”

While you may have a long list of things to do, Hansen says there are really only a few things that you must do—and you need to do those few things well.

“Decide what to focus on in every area: your meetings, your collaborations, your tasks, your projects.”

Hansen shares his definition of smart work.

“You select a few key activities that maximise what you do, then apply intense, targeted effort, and then you have to say ‘no’ to the rest of the activities.” He believes that working smart requires focusing on—actually, obsessing over—these few key activities.

How bosses can help their employees work smarter

Leaders have a greater degree of freedom in choosing how to spend their time. Employees, however, are not afforded as much leeway since they’re subject to the dictates of their bosses.

“There are ‘do more’ bosses and ‘do less’ bosses: the problem with ‘do more’ bosses is that they give employees a lot of things to do,” Hansen says. “They’re piling on the work, so they need to stop and ask themselves how they can trim those priority lists.”

Often, bosses are also overwhelmed with work; however, Hansen says that a good boss doesn’t pass the pressure and unrealistic workload on to their employees.

“And it is bosses that most of the surveyed people blame for having too much to do,” he says.

Communicating simply, thoroughly and clearly can also help employees to understand and focus on what’s important. Hansen advises against convoluted emails and an overabundance of PowerPoint slides.

“Even if you give really good directions, but your language is muddled, people don’t know what you mean,” he explains. “If you say ‘we’re trying to be the best retail store in the city,’ what does ‘best’ mean? Is that selling the most bikes—which means that selling is the priority? Or is it delivering the best customer service?”

In addition, he believes that bosses need to do a better job of inspiring their employees. Yes, workers get a paycheck, but Hansen says that’s not the only reason they come to work. Companies should be concerned if employees are not inspired or engaged, since drudgery is unlikely to motivate them to work smarter.

“They want to feel what they do is important and they want to be uplifted,” Hansen says. “My data says inspired employees perform better.

Terri Williams is a freelance writer who covers leadership topics for The Economist Careers Network.

How to Profit From Open Innovation

Posted on by The Economist Executive Education Navigator

Any conversation on business competitiveness begins and ends with a discussion on innovation, a practice defined as “the fusion of invention and commercialization” by Ken Morse, founder of MIT’s Entrepreneurship Center and a leader of ESADE’s Open Innovation and Corporate Entrepreneurship programme. 

There are three general types of innovation – incremental, radical and open. Of the three, open innovation (OI) appears best-suited for the fierce global competition among firms of all sizes as innovation cycles shorten. Open innovation refers to the practice of looking outside of your organization for ideas and technology to accelerate and improve business solutions. Formally conceptualized by Henry Chesbrough, the methodology is gaining a foothold in entrepreneurially-minded corporations even as it challenges organizational cultures.

How open innovation works

In a perfect OI world, new products, services and business models are produced faster and better through collaboration among company stakeholders, startups and universities. Why? Because “companies recognize that not all of the smart people work for them, and in-house R&D labs can’t create all the innovation necessary to stay competitive,” explains Morse. So, they bring their experience and ideas together in mutually beneficial partnerships.

First, large companies identify startups whose technology matches their needs and become their first customers. Then, they invest further to ensure supply. University R&D centres receive sponsorship for their research activities, and larger firms maintain their competitive advantage by getting new inventions to market faster: “continuous innovation is not an option, it is imperative to success,” he stresses.

Keywords in OI are “inflows” and “outflows”, referring to the direction that ideas and technology move. Firms incorporate knowledge and inventions from outside sources into their innovation processes. Any ideas or developments that are not utilized, however, flow back outside for other organisations to take up, sometimes through joint ventures, licensing or spin offs.

Any company with ambition and global potential can benefit from OI

L Brands, owner of the Victoria’s Secret and La Senza labels, for instance, collaborated with Mast Industries to revamp production using Mast’s deep expertise in rapid sourcing, manufacturing and logistics. L Brands ended up acquiring the company as Mast Global.

How do these disparate parties find each other for open innovation collaboration? That’s a growing industry in itself. Consultancies now specialise in identifying and bringing partners together, and some large companies have in-house scouts, typically company veterans who know the products well and have easy access to the CEO. Global players like GE and Lego have created their own platforms whereby anyone can share new product ideas, and the company supports implementation of the winning ones. University and government research centres like MIT’s Startup Exchange , Startup NASA and UnternehmerTUM in Munich provide places for innovators to connect. Well-known entrepreneurs and networking aficionados like Morse also play a role. “Big companies don’t know how to find those small companies, so they call me and people like me,” he explains.

How to organise for an OI environment

Understandably, OI represents for most companies an entirely new way of developing products, and the culture change can be hard. Leadership makes the difference, Morse emphasizes: “All companies that are doing well with open innovation have made the decision from the top.” Driving strategic innovation from the C-suite is crucial, he believes, in order to “prevent middle-management from watering down programmes.” Also important is the recognition at all levels that failure is inherent to the process of invention and should be seen as part of the learning curve.

Training for the shift

ESADE’s open innovation programme in Barcelona hosts 40 to 50 students each session for an intense five days — two days on OI methodology, two days on sales strategy and elevator pitching, and a wrap-up day of presenting business plans to juries of experienced entrepreneurs and innovators. Morse considers the sales strategy part critical to the success of innovation as “commercialisation is all about sales and acquiring customers.” In his research at MIT, his team found that building the right sales model was actually a better determinant of corporate success than technology. “Pitching is key” to getting your ideas accepted throughout the innovation process, he adds. Morse and other course leaders – including Chesbrough, the “father” of OI – draw on exclusively European company case studies, and require students to prepare and deliver a pitch on a business idea. Most of the participants are executives in established companies in Europe and Asia.

Harvard Business School’s Leading Product Innovation teaches participants to bring flexibility into the product development process, including OI methodology. Participants in The Innovative Organization programme at Berkeley learn strategies to develop an innovative business culture within their organisations while receiving plenty of real-world open innovation examples from Silicon Valley. Finally, the joint MIT/IMD course Driving Strategic Innovation is similar to ESADE’s minus the pitching element and engagement with real-world executives.

As revolutionary as it is, OI is not set to overtake other innovation methods. Morse is quick to acknowledge that it is but one of the tools companies can use, and that most should be pursuing innovation on several parallel tracks. A leader’s job is “to consider alternatives, make investments and remember that it’s all about people,” adds Morse. Corporate leaders who have not yet taken a close look at open innovation might want to start if they wish to keep their organisations out in front.

Kate Rodriguez is a former senior career search researcher and government analyst who covers career development and higher education marketing for The Economist Careers Network.

 

3 Ways to Build Wealth While Balancing Your Career and Motherhood

Posted on by The Economist Executive Education Navigator

It’s mixed news for mothers. Today’s professional women with families have more flexibility than ever before to balance work and caregiving.

Yet across the board women continue to earn, save and invest less than men their age, says Kimberly Palmer, financial expert and author of a new book Smart Mom, Rich Mom: How to Build Wealth While Raising a Family.

Double Punch
This gap in financial well-being between the sexes is due in part to the “motherhood penalty”— the loss of income and career stagnation that affects many female workers who have children. But a lower level of financial literacy among women also plays a large role, argues Palmer: “It takes root at an early age. Studies show that already as children, boys say they feel more comfortable with money and talk more about financial goals with their parents than girls.” It’s no surprise then that, as adults, women report lower levels of confidence when it comes to managing money.

These factors combined mean that women build less wealth over their lifetimes, often with lingering, unfavorable consequences. One recent survey showed that U.S. women over 65 are 80 percent more likely than men to live in poverty. In Europe, the average woman’s pension is worth only 60 percent of that of a man her age.

The anecdote, according to Palmer, is for working mothers to set clear money and life goals, and continue to make progress on them even as they balance the competing priorities of job and family. Here she recommends three ways professional women can become wealthier while managing their career and kids:

1. Make Fair Demands
Palmer argues that working mothers often trick themselves into believing they are not worthy of salary raises, promotions and their share of perks. Women’s lack of confidence with money matters contributes to this, making it uncomfortable for some to ask for what they deserve. But not learning to negotiate for higher salaries and better benefits has a long-term financial impact, she stresses. Research done at the University of Massachusetts revealed that a man’s salary increases six percent for each child he has but a woman’s drops four percent for each child, even if both continue to work full-time.

Women should take full advantage of the benefits offered in the workplace, including flextime, telecommuting options and extended maternity leave, Palmer recommends. They should regularly research salaries to make sure theirs is in line with the market, and, if not, negotiate a fair increase.

2. Maximize Career Satisfaction
Regardless of whether a professional working mother works full-time, part-time or opts for an extended break to care for children, she should stay in a field she finds fulfilling, Palmer urges. Career satisfaction leads mothers to remain in the workforce longer, giving them greater opportunity to build wealth. Many professional women with families take a non-linear career path not only because it provides them more flexibility but it is also a more rewarding way to do the work they love. This might include freelancing, launching side businesses or becoming self-employed. Such options allow them to meet competing demands and even scale back work while not sacrificing earning power long term.

3. Discover The Inner Investor
Palmer encourages mothers to embrace their roles as family money managers. That involves organising financial information in one place, and setting aside time on a quarterly basis to review accounts, file paperwork and make financial decisions. Assuming the lead on long-term investment strategy is equally important, and here women still have a lot of ground to cover. A 2013 Fidelity Investments report noted that only 19 percent of married women in the U.S. have primary responsibility for retirement decisions.

While mothers tend to prioritise their children’s financial needs over their own, Palmer advises against it: “with money, women really have to put themselves first.” Given the choice between saving for her retirement versus saving for a child’s university costs, a mother should save for her retirement since there is no other way to pay for it.

Although she makes clear that a working mother at any age or professional stage can learn to be smart about money, Palmer underscores that a wealth-building attitude ideally begins long before she has a baby. Young women need to become confident money and investment managers now and pass the torch on to their daughters.

Kate Rodriguez – career development and higher education marketing for The Economist Careers Network

 

How to Create a Personal Connection With Corporate Values

Posted on by The Economist Executive Education Navigator

It’s one thing to rationally explain your organisation’s purpose but quite another to fully translate that purpose so that employees throughout the company can connect emotionally to your mission and strategy.

Lacking an alignment of stated values and lived reality, an entire organisation may suffer. In the words of management strategy author Patrick M. Lencioni, “Empty values statements create cynical and dispirited employees, alienate customers, and undermine managerial credibility.”

One potential tactic is to create a corporate social responsibility department. In practice, though, these units often become siloed, and the the work they do may not ever enter the consciousness of the average employee. So how do you turn a bulleted list of core values on a webpage or PowerPoint slide into everyday behaviours that fully embody the values you’ve set forth?

One technique being embraced by socially conscious, values-based organisations is immersive, intercultural off-site experiences.

More than a mission statement
“Get out of the office,” says Annemarie de Jong, a partner with the Netherlands-based leadership consultancy Better Future. “But don’t just hold a retreat at some anonymous corporate venue in the woods. It should take you and your team far beyond the confines of your everyday context, where you can get to know your customers, partners and contractors while tackling real-life social challenges and make an immediate positive impact.”

De Jong’s group does this by taking leaders and their teams on multi-day, immersive “journeys” to locations around the world – an approach based on the research of Dr. Otto Scharmer, a Senior Lecturer at MIT’s Sloan School of Management and co-founder of the Presencing Institute. “We take teams to places where they can get a direct sense of the effect their work has on others. For instance, we might take investment bankers to the countries where their money is being put to use, and put them to work on real-world business challenges with their local client counterparts.”

By coming to understand customers and partners as people and not just personas, by immersing themselves in the social scenarios impacted by their work, the executives who go on these journeys come to embody the values leading their organisations. Immersion experiences abroad also usually include homestays with local families, so that both parties can experience each other holistically, in both public and private environments.

Micro-immersion alternatives
De Jong generally organises week-long journeys for clients, but not all budgets are up for the bill. Managers looking to stay lean can still foster transformational experiences with as little as a single day of good actions close to home. For example, the managers from your construction company could spend a day volunteering in a soup kitchen frequented by the people who will be living in the low-cost housing they’re building.

One last tip that de Jong has for any organisation setting up immersive social challenges for employees is this: if the immersion is only available to a limited number of individuals – say, senior executives – make sure to equip them with the tools to transmit some of their core learnings to the teams they oversee. “The impact of the experience is exponential,” she says, “when those involved act as catalysts for change back in the office.”

Laura Montgomery is a higher-education expert who blogs for The Economist Careers Network

 

The one Word at the Centre of a Meaningful Workplace

Posted on by The Economist Executive Education Navigator

“If you don’t have it, all the technical, fiscal, communications and strategic expertise in the world won’t help you. But those who do have it – and work ceaselessly to strengthen it – find that everything else falls into place throughout their organisation.”

So says former Fortune 500 senior executive Bob Whipple. Now CEO of Leadergrow, Inc. and a longtime consultant, trainer, and author in the area of leadership, Whipple bases his entire approach around one word, one principle that holds people together in a “framework of positive purpose”: trust.

A different kind of “trust fund”

There are many exec-ed programmes on leading with meaning, and countless behaviors that constitute great leadership, but Whipple maintains that everything centres around trust. He describes trust as a bank account – we will make deposits and withdrawals over time, but the key is to keep a positive account balance and to keep it as high as possible. As he puts it, “We make small, incremental deposits in our account – by treating others with respect and giving them autonomy, admitting our mistakes, acting with integrity, living our values.”

While we rarely have the chance to make a large deposit in our “trust fund”, withdrawals can happen suddenly and on a large scale. How many times have we said or heard the phrase: “After this, I’ll never trust that person again”? Trust is fragile. This is why it’s critical to build up a strong reserve so the balance doesn’t drop to zero when the inevitable misstep or unpopular decision comes along.

Eliminating fear in the workplace

What’s the most important thing you can do to foster a sense of meaning and trust among people in your organisation? Eliminate fear, says Whipple. “Create an environment where people feel safe and confident to sincerely express a difference of opinion without fear of negative repercussions. Instead of ignoring or penalizing staff when they share honest yet critical perspectives, great leaders reinforce candour.” He urges managers and executives to listen to their teams respectfully, consider criticisms thoughtfully and share their considered response with everyone involved.

To create a fear-free professional atmosphere, Whipple adds that leaders need to be balanced, not only in the way they process critical opinions, but also in the way they hold others accountable. “We need to rethink the word ‘accountability’,” he states. “For many leaders, ‘holding others accountable’ has a strong, negative, punitive connotation.” Whipple doesn’t deny there should be consequences for poor performance – but, “we should be holding others accountable for their successes as well, taking time to call out and celebrate excellence.”

Setting the right tone in a new leadership role

Finally, Whipple has a few words of guidance for executives transitioning into a new leadership role in their current organisation or with a new company. “I often see new leaders try to impose their influence very quickly and forcefully. They believe being a strong leader means making a mark and getting noticed right away.” They make the mistake of referring often to past successes or the “better” approaches they’ve used previously. But this approach makes people feel like they’re not being listened to – and gives them the feeling that all the hard work they’ve been doing was wrongheaded or wasted.

Instead of starting a new leadership role by trying to impose “your right answer”, Whipple recommends keeping a low profile in the early days and absorbing like a sponge everything you see and hear. Only then, building on a foundation of intelligent listening, will leaders be able to start building the trust and candid communication so vital to a positive and meaningful work environment.

Laura Montgomery is a higher-education expert who blogs for The Economist Careers Network.

 

Should we Prepare for a Bossless Future?

Posted on by The Economist Executive Education Navigator

Top-down hierarchies are out, creative and collaborative structures are in. This approach to management is starting to become a new norm in the startup world.

But can we expect this trend to gain significant traction in the mainstream corporate realm anytime soon? Could the CEO go the way of the dodo?

Innovation and disruption are the key ingredients for a successful fast-growth startup venture – as well as for any established enterprise wanting to keep pace in a quickly evolving competitive ecosystem. Today, even historically traditional organisations are starting to study the flexible structures found in startups in order to facilitate a capacity for change and nimbleness. Taken to its greatest extreme, the pursuit of an endlessly agile, flexible structure would theoretically result in abandoning traditional management hierarchies entirely.

Seeking the startup’s secret sauce

Indeed, the concept of “holacracy”, invented by software executive Brian Robertson and most famously implemented by Zappos, calls precisely for this. An organisation practicing holacracy “removes power from a management hierarchy and distributes it across clear roles, which can then be executed autonomously without a micromanaging boss.” Comparable structures, based around employee self-management and team-based accountability, can be also found at companies such as Morning Star and W.L. Gore (Gore-Tex products).

The move toward these flat, democratic management structures is rooted not only in a goal to replicate the success of the startup economy. They are also the result of an evolution in the way leadership itself is defined. “In much of Western culture, leadership has been psychologically associated with status and power,” explains Shaun Johnson, co-founder of the Startup Institute and a current entrepreneur-in-residence at Georgetown University’s McDonough School of Business. “However, true leadership is actually about servitude and being able to put organisational success before your own personal triumphs. These bossless structures are meant to foster a more authentic model of leadership throughout an organisation.”

Still a phenomenon of the fringes

But while these companies make for fascinating case studies, real-world results of holacracy and other bossless structures have been mixed. And oftentimes the approach can produce more questions than answers. How do you determine whether employees are doing their job properly? What recourse do you have if they’re not? How do you establish hiring and compensation policies? And, of course, how will you ever find the CEO willing to introduce a management model that would essentially make their own title and authority obsolete?

“It’s still something practiced only at the bleeding edge of management circles – nowhere near becoming a mainstream phenomenon,” says Johnson. Yet, even if “bosslessness” isn’t a panacea for survival in the innovation economy, there is a broad spectrum of democratic management approaches that organisations can experiment with. Company-wide collaboration, transparency, accountability, productivity, and the most efficient and effective use of employee resources: these are some of the core goals and values of the democratic workplace. Goals which organisations today have the opportunity to address through any variety of means – bossless or not.

Laura Montgomery is a higher-education expert who blogs for The Economist Careers Network.

 

Executives Becoming Better Leaders Through Mindfulness

Posted on by The Economist Executive Education Navigator

Think of qualities and behaviours popularly used to describe effective, authentic leaders: focus, observation, objectivity, balanced decision-making. These are precisely the characteristics cultivated through mindfulness meditation.

And today, even the most profit-driven companies and c-suiters are turning to mindfulness techniques to help them manage stress, control their attention, and make better decisions in the workplace. You’ll also find more and more executive training courses on leadership and management starting to incorporate mindfulness training. What is this trend all about?

Yes we can
Google made headlines a couple years ago when it started offering a ragingly successful seven-week class to employees called “Search Inside Yourself”. CEOs like Salesforce’s Marc Benioff and LinkedIn’s Jeff Weiner have also touted the bottom-line benefits of meditation. Meanwhile, at Nike, General Mills, Target and Aetna you’ll now find in-house classes that teach employees how doing “nothing” can help them achieve more. And business schools around the world have gotten on board as well, offering one to five-day workshops and seminars with titles like Micro Actions: Mindful Communication for Powerful Impact”, Mindful Leadership”, and Leading Authentically with Mindfulness”.

It’s a trend that executive coach Eden Abrahams of Clear Path Executive Coaching has observed in her work, as well. “Everyone is stretched, stressed, and managing tremendous amounts of information through technology. We have only so much cognitive horsepower—so, it’s hard to be creative and visionary when you’re constantly being bombarded with inbound stimuli.” Executives are turning to mindfulness meditation to improve their capacity for things like:

  • Staying focused for long periods of time with less stress
  • Listening carefully to others’ perspectives – especially when they conflict with their own
  • Reaching decisions based on rational thought processes rather than emotional reactions
  • Aligning thoughts and actions with what is most important in their lives

The ROI of being in the moment
What’s more, the positive effects of mindfulness are more than just subjective experiences. “There’s an ever increasing body of research and evidence proving that reducing stress and anxiety and just learning to be present in the moment can have a positive impact on productivity,” says Abrahams. For example, in a 2014 study, researchers at INSEAD and Wharton concluded that as little as 15 minutes of meditation can help managers make more profitable decisions by helping to overcome the “sunk cost bias” – the cognitive tendency to continue an undertaking once an investment has been made in order to recover or validate “sunk” costs.

Until you find time for a mindfulness seminar or even a full retreat, you might check out these tips for incorporating “micro meditations” throughout the day to see how it impacts your business behaviour.
Laura Montgomery is an independent higher-education consultant.

 

Three Unique Skills Expected of Nonprofit Leaders

Posted on by The Economist Executive Education Navigator

News media heralded the rise of the nonprofit sector two decades ago, and it’s still the fastest growing sector in the U.S. as well as the largest source of employment in many countries. This means opportunities are mushrooming to join and lead associations, foundations and similar institutions around the world.

But for anyone who thinks management is management, regardless of the sector, think again. It’s not by chance that there are so many MBA and executive-education programmes devoted exclusively to advancing nonprofit careers. There are some major differences in the way nonprofits are expected to operate compared to for-profit businesses.

These differences call for a very specific set of skills that can make or break a career in this sector. Here are three of them.

1. Motivating staff without financial incentives

Nonprofit salaries are modest, and raises and promotions are rare in these generally flat hierarchies. You’re also dealing with a lot of volunteers, both as staff and as board members. “In for-profit enterprises you can get away with being a leader of tasks in order to achieve your goals. Nonprofit managers have to be effective leaders of people, first and foremost,” explains Marc Hardy, Director of Nonprofit Executive Programs at the University of Notre Dame’s Mendoza College of Business. He describes effective nonprofit leadership as “sharing fire” – “It’s not about getting people to follow you; it’s about investing in people as individuals and igniting the passion within them.”

2. Identifying non-financial measures of success

Concepts like key performance indicators and success metrics are critical in both the for-profit and non-for-profit worlds. But in a private business, it’s comparatively easy to look at a spreadsheet full of numbers and measure performance. In the nonprofit world, on the other hand, you need to establish how to measure the social return on investments. “The first step is figuring out which factors you even can measure,” says Hardy, “Next you pick which to focus on and how to communicate them.” Among other things, this means that nonprofit institutions have an increasing need for people who can analyse multifaceted data sets and use them to tell a story that goes beyond profits and losses.

3. Managing diversity – in teams and stakeholder groups

Nonprofit employees come from an incredibly diverse set of professional, cultural, and economic backgrounds. Nonprofit stakeholders are equally diverse – ranging from staff members and service clients to foundation partners and corporate supporters. How can you overcome inertia in this kind of environment? In interviews with nonprofit chief executives, consensus building emerged as one of the most important skill-sets respondents relied on. Effective nonprofit leaders work to ensure that all parties feel free to contribute their feedback and ideas – however novel or divergent – and to implement those ideas where possible and share in any resulting successes. Although decisions and results may take longer this way, the good news is that research consistently shows that diversity leads to greater innovation.

These three skill sets are some of the most common areas of focus in executive-education programmes on nonprofit leadership. You’ll find them at the heart of courses on topics as diverse as nonprofit governance, performance measurement, leadership strategy and even fundraising.

Laura Montgomery is a higher-education expert who blogs for The Economist Careers Network.

 

Why Social Entrepreneurs Are Taking The Lead

Posted on by The Economist Executive Education Navigator

Improving the world and the bottom line simultaneously has never been more on-trend. Social entrepreneurship, the concept of applying business techniques and market mechanisms to solve social problems, such as poverty, violent crime or environmental threats, has been around for decades. 

The practice received a significant public boost, however, in 2003 when a group of NGO heads was invited to the first-ever social entrepreneurs sessionat the World Economic Forum in Davos. Since then the idea has been embraced globally by businesses, governments and non-profits alike. 

The result is a new breed of socially-conscious business models and a rising demand for organisational leaders who can steer innovation along such lines.

A Multi-Purpose Model 

In practice, social entrepreneurship is a flexible methodology that’s applied differently depending on the type of organisation, but the goal is the same – to help an organisation excel at its core mission. “Non-profits want to know how to move away from a charity-based model and toward more sustainable sources of funding that leverage their activities to generate revenue,” says Hans Wahl, Co-Director of the INSEAD Social Entrepreneurship Program (ISEP), an executive education course offered in Fontainebleau, France and Singapore. Integrating business ideas facilitates this. One such example is DC Central Kitchen, a non-profit in Washington, DC that provides free meals to homeless shelters and produces income by operating a catering service.

For-profit companies have discovered that integrating socially responsible practices into their business operations has benefits well beyond positive public relations. According to Sarah Soule, Faculty Director of Stanford’s Executive Program in Social Entrepreneurship (EPSE): “Corporations see that some of the best business opportunities come from solving real problems, hence their exploration into new markets and developing countries where opportunities to grow are expansive yet at the same time meaningful.” Coca-Cola, for instance, sponsors business training programmes for women in Brazil, many of whom operate kiosks, a main sales source for Coke products. It’s a win for the women, who acquire the means for success, and a gain for Coke, as it helps the company maintain a strong supply chain in a growing market. 

In addition, for-profits increasingly rely on their social commitments to attract prospective employees who are drawn to organisations that support good causes. “Smart for-profit firms recognise that to win the war for millennial talent, they must deliver on this dimension,” adds Soule. Wahl agrees: “People want to work for more than just a paycheck.”

Even some governments are integrating “business for good” ideas into their planning in an attempt to be more effective. Among ISEP’s recent alumni is the head of an economic development agency in Denmark.

Leading It Socially

The many success stories of social entrepreneurship in action show it can drive innovation in nearly any organisation. Interest in executive education courses for leaders of socially-driven organisations is high. Both Stanford and INSEAD claim the number of applicants to their 6-day programmes grows steadily. The majority of participants are executives in non-profits who’ve been tasked with scaling up the business by rethinking revenue streams or launching a new social arm. Also filling seats are top managers of companies that want to broaden their corporate social responsibility activities. It’s a similar mix at Hertie School’s Social Innovation and Social Entrepreneurship seminars. Harvard Business School offers separate education programs to leaders of non-profits and for-profits.

Nurturing the Next Social Entrepreneur

Learning to innovate like a social entrepreneur requires a shift in strategic thinking, especially for leaders in well-established organisations. Executive education programmes come at this training from different angles. Stanford’s EPSE cohorts participate in a full day design thinking bootcamp, where they learn the techniques of empathizing with customers, defining problems and developing rapid prototypes in order to create new social initiatives. At ISEP, students work through challenging case studies around themes like the difficulties of scaling or negotiating tradeoffs between being responsible to local stakeholders and answering to company shareholders.

Important Takeaways

The opportunity for participants to make connections is an important component of social entrepreneurship courses. Many find that they can adapt the innovations they learn about from peers for their own organizations. Stanford ensures that its EPSE alumni are well connected on social media, and invites many back to campus to network with current programme participants. Wahl stresses that ISEP is much more than an executive education programme: “It’s an entire community around social entrepreneurship.” ISEP’s true strength lies not just in the participants’ diverse backgrounds but in the networking that continues long after a course ends, he says. 

Leaders across all types of organisations are now charged with broadening social agendas. A non-profit must learn to operate like a business in order to realise its vision, and a company needs to innovate models that benefit both society and its business activities. Adopting a social entrepreneur mindset will soon be a must for all leaders.
Kate Rodriguez is a former senior career search researcher and government analyst who covers career development and higher education marketing for The Economist Careers Network.

 

Why is “Design Thinking” on the Lips of so Many Business Leaders?

Posted on by The Economist Executive Education Navigator

These days there’s a lot of talk – and a lot of executive education – revolving around “design thinking.” Companies like Apple, Netflix, Facebook and others are disrupting industries and business models left and right. And with these developments comes the realization that traditional approaches to problem-solving are no longer enough.

So, across industries around the world, attention is shifting to design thinking as an approach for unleashing creativity and innovation in organisations.

But what is design thinking?

Although the stereotypical image of “the designer” is often an egocentric, domineering aesthete, design thinking is actually highly collaborative process that has relatively little to do with visual appearance. 

As defined by the Stanford University Institute of Design, the design thinking process consists of five steps:

1. Empathize – working to fully understand your customer through observation and interviews
2. Define – synthesizing findings from the previous step to form a “user point of view”
3. Ideate – structured brainstorming of possible solutions
4. Prototype – giving a physical, digital, or diagram form to selected ideas
5. Test – putting prototypes into practice to see if they meet the user needs identified at the beginning

Unlike analytical thinking, which focuses on the problem at hand and considers how current resources and knowledge might fix the problem, design thinking focuses on the ultimate goal, apart from whatever the current situation might be.

According to Melissa Rancourt, academic director of the Global Executive Master’s in Strategic Design and Management at Parsons School of Design, this focus on future goals rather than current constraints “challenges the status quo and forces you out of your comfort zone”. Using creative design processes, “you often end up completely discounting existing problems, instead uncovering an unexpected approach that could ultimately lead to an entirely new business model.”

Rancourt adds that a process like this needs must necessarily tolerate – and even embrace – ambiguity and failure. “The iterative nature of design thinking assumes that multiple possible solutions and prototypes will be explored and tested simultaneously, and ideas are bound to be modified and even discarded along the way.”

How is design thinking being implemented in the business world?

Sure, there are companies like Airbnb or Uber that are founded on design thinking. It’s natural in smaller companies. But Rancourt explains that large businesses operating within traditional industries are now training their staff on design thinking. “Even if they don’t immediately implement design thinking across the board, they are setting up design-thinking teams,” she explains. “These groups are given the freedom to think totally out-of-the-box and test out solutions that might be expanded across the organisation.”

When you think about it, the exec-ed classroom is an ideal place not only to learn about design thinking, but also to actually participate in it first-hand. In any exec-ed programme worth its mettle, you’re not going to find a lecture-style setting where a professor stands in front of the room and dictates the right answer. 

Instead, you’ll be working through a set of highly experiential exercises together with people from a diverse set of professional backgrounds. Each participant contributes different ideas, and immediate feedback and vetting leads to those ideas either getting discarded – refined into creative, innovative, design-led solutions.

Laura Montgomery is a higher-education expert who blogs for The Economist Careers Network.