The Culture of Collaboration

Collaboration Means Knowing When to Step Aside

“Do you want to be rich or do you want to be king?” That’s the question Mark Perry, general partner with New Enterprise Associates, asks founders of portfolio companies who resist being replaced. Often, venture capitalists like Mark seek to replace founding CEO’s with leaders who are more suited to take a company to the next level.

 

Collaborative leaders willingly step aside when it’s the right decision for the company. After all, many people have a stake in a company’s success including investors, employees and customers. For a founder to remain CEO because of ego and bravado can damage the company he or she has worked hard to create.  And, as Perry points out, the rewards for everybody are often greater when the founding CEO moves on at the right juncture.

 

At the 19^th Annual IBF Venture Capital Investing Conference last month in San Francisco, venture capitalists and executive search consultants debated issues including CEO succession on a panel called “Building a Management Team in 2008.” The panel included venture capitalists Mark Perry of New Enterprise Associates, Cameron Lester of Azure Capital Partners and Mark Sugarman of MHS Capital plus recruiter Aaron Lapat of J. Robert Scott. Recruiter Jeff Kuhn of FLG Partners moderated the panel.

 

The VC’s agreed that it becomes obvious over time if the CEO puts his or her own success above that of the company. This is exactly the kind of behavior smart VC’s seek to identify before they invest. Cameron Lester of Azure Capital Partners recommends asking founders the question, “If this company grew beyond you, would you be willing to step aside?”

 

Stepping aside, deferring to others, and soliciting input are among behaviors key to collaborative organizations of all sizes.  When we use collaborative tools including web conferencing, it’s important to relinquish control and let colleagues take the cursor while sharing applications. In a broader sense, collaborative people understand how their expertise contributes to collaborative work and know instinctively when to defer to those with complimentary skills.

 

Challenges for collaborative leaders include resisting the control paradigm and inviting input from all levels and functions.  Then it’s easier to recognize when changing roles, relinquishing authority, or even leaving the organization benefits the company. The acid test is whether stepping aside creates organizational value.

Collaborating in the Same Room—What a Concept!

Collaboration happens because of the interplay of culture, environment and tools with an emphasis on culture. While tools are key enablers, collaboration never happens solely because of tools. That said, real-time tools including instant messaging, web conferencing, videoconferencing, telepresence and virtual worlds plus asynchronous tools including wikis, team sites and social networking are extending and enhancing collaborative culture and eliminating distance as a barrier to business and relationships.

 

Ironically, we’re getting better at collaborating at a distance than when we’re face to face. Assuming we work in a collaborative culture and effectively use tools, we are more likely to share applications and collaboratively produce products and services when distance is an issue. In contrast, when we’re all in the same room, too often we meet rather than collaborate. Some highly-collaborative organizations are designing their workplace environments to enhance brainstorming and collaboration.

 

Microsoft has created a new research entity in its business division called Office Labs, which is focusing on the future of how we work. One effort involves exploring how to more naturally interact with information.  At the Microsoft CEO Summit in May, Bill Gates demonstrated an “intelligent white board” or touch wall called Plex. Plex has scanning cameras at its base, so that it can detect when users touch its surface. Using our hands, we can zoom out to reveal documents, images, spreadsheets, presentations, browsers and other applications. We can touch a document, flip through its pages, and zoom in to examine flow charts and other embedded elements. We can also use our fingers to draw on Plex.

 

Intelligent white boards are one tool that may enhance collaboration when we’re sharing the same physical space. Ultimately, every horizontal and vertical surface in collaborative rooms could be an inexpensive intelligent display. Like collaboration at a distance, same-room collaboration requires the right culture, environment and tools.

Malcolm Gladwell: Measurement Methods Killing Creativity and Innovation

Malcolm Gladwell is about to turn talent recruitment and development upside down. Last Monday at the American Society for Training and Development 2008 International Conference and Exposition in San Diego, I talked with Malcolm about his forthcoming book.

 

Outliers: Why Some People Succeed and Some Don’t tackles everything from college and graduate school admissions to organizational performance evaluations. An outlier is a statistical term meaning a significant deviation from the mean. The book, which will be published in November, is based largely on the work of David Galenson, an economist at the University of Chicago. For more on Galenson’s work, read the story entitled “What Kind of Genius Are You?” that Daniel H. Pink wrote for the July, 2006 issue of Wired.

 

Gladwell’s point is that there’s a disconnect between methodology for evaluating people and individual talents. He’s wary of efforts to predict performance and suspicious of set timeframes to perform. “We’ve become obsessed with this notion that everything can be measured with numbers,” Malcolm insists. “It’s a cultural fixation.” While law schools are obsessed with LSAT scores, Gladwell notes, studies show that people who are admitted with lower scores show no difference 20 years out than those with high scores.

 

Gladwell uses the artists Pablo Picasso and Paul Cezanne to illustrate two key types of people. Picassos succeed quickly and often peak early, while Cezannes are typically late bloomers who rely on technique and process and make incremental advances to build a body of work over time. “A late bloomer gives us something you can’t get from a precocious artist. The work is much more powerful and has deeper depth,” says Gladwell. The HBO series, The Sopranos, took three seasons to catch on, Gladwell notes, but ultimately the show developed a deeper level of emotional connection with the audience. This is because HBO is willing to carry a portfolio of under performers; the network realizes the potential for a long-term winner among them.

 

At the ASTD conference, I engaged Malcolm about organizational culture, and he agreed that culture plays a huge role in how people are recruited and evaluated. Organizations are clearly comprised of both Picassos and Cezannes, but there is also a collective approach that favors one style over the other. Particularly relevant to collaboration is Malcolm’s use of the U.S. vs. the Japanese auto industry to illustrate his point.  I have written extensively about how collaboration has created substantial value for Toyota and how people throughout the organization provide input into decisions, which are made slowly and carefully. Toyota focuses on incremental improvements over time and building long-term value, a Cezanne approach. Malcolm notes that Detroit-based automakers traditionally rely on big, bold ideas like the SUV and muscle cars. This is more Picasso-like.

 

The problem is that measurement and evaluation usually favors Picassos over Cezannes. Organizations value the sprinters over the distance runners and too often sideline people who develop deeper depth over time. Innovation and productivity suffer, because key resources are wasted. This will evolve as organizations become more collaborative, harness talent in all its forms and realize the limitations of a single performance template. Enron selected top performers and pitted them off against each other through “rank and yank.” This created a culture of fear rather than one of collaboration. The company had little tolerance for Cezannes. Look where Enron is now—bankrupt.

 

Incidentally, Malcolm’s Wikipedia entry notes that he was an outstanding middle distance runner in high school…

Is Ford's New Marketing Head a Star? Plus Keith Richards Provides Collaboration Insight

James Farley is no star, but The New York Times would have us think otherwise. Farley is Ford Motor Company’s new group vice president of marketing and communications. He took the job after spending seventeen years at Toyota, most recently as group vice president and general manager of Lexus.

The Times ran as its business section lead last Sunday a story about Farley headlined “A Star at Toyota, A Believer at Ford.” There is little in the story that would suggest Farley is a star, but the Times nevertheless packaged the story in a way that perpetuates the Myth of the Single Cowboy. This is the notion that one self-sufficient, rugged individual can achieve smashing success without help from anybody. We turn athletes, chefs, surgeons, politicians, entrepreneurs and corporate leaders into stars. The media drives this myth into our living rooms, our organizations and into our consciousness.

In the same edition as the Farley story, the Times travel section's first page promoted a story on French chefs on page 7 as “The New Culinary Stars of Bordeaux.” What about the line cooks, the prep people, the servers and the expeditors? It takes more than a single, star chef to prepare a meal in an upscale restaurant. But the Times and many other media outlets would prefer that we believe one person makes it all happen.

Toyota emphasizes collaboration over star culture. Farley clearly chalked up significant achievements at Toyota, because he collaborated across levels, functions and business units. Rather than practicing shoot-from-the-hip management, Toyota leaders practice nemawashi, which means literally “to prepare a tree’s roots for the soil.” Nemawashi is essentially about getting broad input into decisions and making decisions slowly by consensus. As a star, Farley could never have achieved much at Toyota. As a collaborator, Farley and his colleagues created considerable value.

Over the weekend, I saw the awesome IMAX version of the new Rolling Stones movie, Shine a Light, directed by Martin Scorsese. In the film, Keith Richards discusses his guitar prowess as compared with that of Ron Wood, who shares with Richards the title co-lead guitarist of the Stones. “We’re both pretty lousy, but together we’re better than ten others,” Richards says. This sums up the value of collaboration over star culture.

Dana Holding Corporation Gets Collaborative CEO

Gary Convis is willing to roll up his sleeves and get dirty, and he listens closely and collaborates with people at all levels. The retired chairman of Toyota Motor Manufacturing, Kentucky is joining Toledo, Ohio-based Dana Holding Corporation, as its CEO.

When I was researching The Culture of Collaboration book, Convis was generous with his time and provided tremendous insight into how collaboration creates value for Toyota. Published reports have focused on Convis’ knowledge of lean manufacturing techniques, but he will likely engage Dana team members in every function, region and level to adopt a more collaborative culture.

Convis speaks softly and exudes confidence, but without a trace of egotism. At Toyota, he expected aspiring leaders to spend time on the assembly line. “When you put in days of working on the line with your own hands building a car, what the team member does every day, that means you really connect with that team member and you have respect for what they do,” Convis told me.

As a collaborative leader, Convis seeks broad input into decisions and expects people to contribute regardless of role or title. He also believes strongly in mentoring, and will guide protégés to adopt more collaborative approaches to leadership. Shoot-from-the-hip managers, information hoarders, and people used to star status will likely need to adapt.

Dana and Convis share some values. The “Dana style” of management emphasizes idea generation from everybody and “cooperation among Dana people globally.” However, Convis will likely work across business units and functions to help nourish seeds of collaboration.

Dana’s values, as described on the company’s web site, include employing, developing and promoting “the very best people based on personal performance and skills.” With Convis at the helm, Dana may change this statement to “the very best people based on collaborative performance and skills.”

Overcoming Fear of Failure Enhances Collaboration

Zane Safrit, the highly-collaborative CEO of Conference Calls Unlimited, has added substantially to the conversation about how accepting and learning from failure enhances collaboration. Incidentally, Zane is a living, breathing example of a CEO who leverages collaborative culture and tools to create value.

Conference Calls Unlimited has integrated many collaborative tools into its culture. Using the basecamp Wiki product from 37 Signals, Zane notes, helps eliminate backdoor channels of conversation and decisions at Conference Calls Unlimited. But minimizing fear of failure is more about the culture Zane has helped instill than it is about the tool per se. Rather than trying to hide mistakes, team members feel comfortable sharing work and ideas for all to see. Some ideas work and a few fail, but everybody keeps learning and collaborating; and the company benefits from the cultural acceptance that it’s ok to fail. Zane and his team avoid using the word mistake and instead focus on learning and collaborative accomplishments. And the result is that Conference Calls Unlimited, Zane feels, makes fewer mistakes because of the collaborative culture and environment. You can read Zane’s post here.

Meantime, Citigroup and Merrill Lynch are searching for CEO replacements in the wake of the sub-prime mortgage meltdown. The problem, according to a story (subscription required) by Aaron Lucchetti and Monica Langley in Monday’s Wall Street Journal, is that these firms suffer from a thin talent pool. It seems that the lack of internal CEO candidates stems from a Wall Street culture that is so focused on quarterly returns that leaders quickly lose their jobs if they fail to deliver.

Something else that’s at play on Wall Street is the star cultures that plague many firms. An individual must perform as a star analyst, star trader, or a star executive. If he or she fails, the company is quick to sack the individual. Trust is out the window, and the organization—as we’re now seeing—suffers. This kind of culture gives rise to scandals including numbers fudging. Enron, which had a star culture, comes to mind. In collaborative cultures, team members brainstorm, make mistakes, chalk up successes, and often create far more value for the organization. Overcoming the fear of failing advances collaborative culture and can deliver significant returns.

Collaboration and the New York City Subway

Collaboration enhances efficiency and innovation and keeps the equipment maintained and the trains running on time, literally, for the New York City subway system. In the 1970s, the New York subway system was in a shambles. I know, because I rode the subway to school in those years when I was growing up in New York. System delays and breakdowns were commonplace.

(Above image: A New York subway car in 1979. Photo by Doug Grotjahn, collection of Joe Testagrose)

Part of the problem was that the transit system rarely maintained subway cars and instead bought new ones when it had money, which was rare. This, according to a story by William Neuman headlined “After 45 Years, Subway Chief Has Reached His Stop” in the October 13 edition of The New York Times. You can read the story here. Neuman writes that in the 1960’s, a transit system mechanical engineer named Doug Tilton believed there was a better way and developed a plan to perform scheduled maintenance on subway cars, which was then a novel concept. In those days, according to the article, “most managers at the transit agency were not interested in new ideas from their employees.”

In the 1970’s,Tilton gained traction for his proposal by collaborating with Michael Lombardi, an instructor and manager at the transit system. Lombardi saw an opportunity, because the transit system had hired a consultant to address subway breakdowns. Lombardi and the consultant promoted Tilton’s idea and gained the support of top transit officials.

In 1981, the state of New York authorized a multibillion dollar plan to overhaul the city’s transit system. This helped institutionalize the program which is now known as the Scheduled Maintenance System. The transit authority has extended the program to the bus fleet, and transit agencies in other cities have adopted similar programs.

Lombardi told the Times that in 1979, subway cars broke down on average every 4800 miles traveled. Today they break down every 149,000 miles. Collaboration certainly has created value for the New York City subways. Next month, Michael Lombardi will retire as the senior vice president for subways at New York City transit. By collaborating with Tilton and the consultant, he accomplished more than he ever could have alone.

Collaboration and Star Culture

Collaboration requires collaborative culture. That’s the whole point of this blog. The opposite of collaborative culture is star culture, which our collective culture—particularly in the United States—perpetuates. The media is certainly complicit, because celebrity stories draw audiences. Therefore, the media has a vested interest in manufacturing stars—not just Hollywood people, but business leaders, athletes, entrepreneurs, surgeons, chefs and others. Food writers are particularly culpable, and we’ve certainly seen the celebrity craze spread to winemakers.

Now, apparently, star culture is trying to envelop tequila makers. Last Friday, the San Francisco Chronicle ran a short article by Camper English headlined “Next big thing: Tequila bottle signings.” You can read the article here. The story begins, “Further evidence that distillers are the new rock stars…” We learn from the article that Carlos Camarena, owner and third-generation master distiller of El Tesoro Tequila, will be in San Francisco to sign autographs on $185 bottles of tequila at a liquor store.

Clearly, Mr. Camarena is not alone in contributing to the success of El Tesoro. According to El Tesoro’s web site, making tequila begins with the jimador, the person who hand picks perfectly-ripe agaves and separates the pina, the juicy blue core, from the rest of the plant. “Most other tequila producers use an automated system that processes the entire stem,” the web site notes. Next workers cut the pinas into quarters with a special ax. In the next stage, workers use the traditional method of baking the pina quarters for 36 hours and cooling them for another 36 hours. Next workers use a one-ton stone wheel called a tahona to crush the pinas, extracting their juices. There are three more steps.

The point is that many people with a variety of expertise collaborate to make El Tesoro tequila. While I appreciate the marketing benefits of Mr. Camarena signing tequila bottles during his rock star-style tour, this feeds into star culture and sends the wrong message to the public and to El Tesoro team members. Promoting the CEO as a star may produce a momentary marketing bounce, but a collaborative culture sustains greater business value than a star culture.

Creating Wealth Collaboratively

Collaboration is central to creating wealth. Contrary to the myth our star culture perpetuates, people working collaboratively achieve greater success than individuals. While some individuals may walk away with the lion’s share of the spoils, it takes a village to create their wealth. I’m glad that in his excellent page-one story in today’s New York Times headlined “The Richest of the Rich, Proud of a New Gilded Age” Louis Uchitelle includes steel baron Andrew Carnegie’s philosophy of wealth creation. You can read the story here.

The story compares Bill Gates, Warren Buffett and other billionaires with the super wealthy of yesteryear. Perhaps the most interesting aspect of the story is that it quotes David Nasaw, author of the book Andrew Carnegie as saying that Carnegie believed “individuals do not create wealth by themselves.” This, according to Nasaw, was fundamental to Carnegie’s gospel of wealth. In Carnegie’s view, the community creates wealth and individuals like him are simply trustees of wealth. Therefore, Carnegie gave most of his wealth back to the community in the form of libraries, museums, cultural centers and foundations.

Carnegie’s philosophy applies today to how companies create value. As I describe in The Culture of Collaboration book, companies in a variety of industries are achieving impressive results through collaboration. Among the organizations included in the book are Toyota, Boeing, The Dow Chemical Company, BMW, Industrial Light & Magic, DreamWorks Animation, Mayo Clinic, and the Myelin Repair Foundation. In each of these organizations, star culture takes a back seat to collaborative culture.

Visual Collaboration and a Prosecution Dream Team

I had lunch the other day with J. Christopher Anderson, part of the prosecution “dream team” recently honored with a “home run hitters award” from the National District Attorney’s Association. The award stems from the efforts of Chris and his colleagues in the Lucas County Prosecutor’s Office in Ohio to solve a cold murder case.

The case involved the stabbing death in 1980 of a Toledo nun. Prosecutors persuaded a jury last year to convict Toledo priest Gerald Robinson of the murder. During the trial, witnesses testified that Sister Margaret Ann Pahl was stabbed 31 times, including nine wounds shaped like an inverted cross and made through an altar cloth.

Chris mentioned how he and his colleagues are using the SMART Board interactive whiteboard from SMART Technologies in Calgary, Alberta, Canada. SMART is particularly helpful in presenting scientific evidence-oriented cases such as the Gerald Robinson trial, because prosecutors can mix images, video and other digital files on the board and annotate the content to help juries understand their arguments. In one case, Chris says he used the SMART board to demonstrate through an animation how a bullet pierced a door.

Using interactive whiteboards helps collaborators achieve common goals. For prosecutors, the goal is a conviction. While using an interactive whiteboard at a trial is more presentation-oriented, prosecutors can also use such tools more collaboratively while developing trial strategy. And many other occupations can enhance goal achievement and collaboration through interactive whiteboards. For engineers, the goal might be designing a world-class skyscraper or developing a more effective integrated circuit. For businesspeople, the goal might be penetrating a new market.

When we talk about collaboration tools, we’re usually referring to tools that collaborators in different locations use. In The Culture of Collaboration book, I point out that as distance collaboration tools get better, our challenge is to collaborate as effectively in the same room as we do remotely. Interactive whiteboards address this issue. We can push content from our laptops to the boards, group write documents, work together on graphic design or presentations, and even edit videos together in the same room. The take-away is that collaboration should be as effective when we’re sharing the same physical space as it is when we’re geographically-dispersed.