Your job might be killing you

There are 120,000 excess deaths per year attributed to ten workplace conditions and they cause approximately $190 billion in incremental health care costs. That makes the workplace the fifth leading cause of death in the U.S. — higher than Alzheimer’s, higher than kidney disease.

  1. Being unemployed sometimes as a result of a layoff.
  2. Not having health insurance.
  3. Working shifts and also working longer periods, e.g., ten or twelve-hours shifts.
  4. Working long hours in a week (e.g., more than 40 hours per week).
  5. Job insecurity (resulting from colleagues being laid off or fired).
  6. Facing family-to-work and work-to-family spillover or conflict.
  7. Having relatively low control over one’s job e.g., workload.
  8. Facing high work demands such as pressure to increase productivity and to work quickly.
  9. Being in a work environment that offers low levels of social support (e.g., not having close relationships with co-workers.
  10. Working in a setting in which job- and employment-related decisions seem unfair.

Both articles report the findings published by Jeffrey Pfeffer in Dying for a Paycheck: How Modern Management Harms Employee Health and Company Performance—and What We Can Do About It.

I have not read the book yet, but I definitely will.

 

 

What does work flexibility look like?

A meta-analysis of the existing research on flexibility identified the fundamental components:

  • Where we work,
  • When we work, and
  • How predetermined our schedule is.

These component parts lead to six distinct types of flexibility:

  1. Remote: “Work from anywhere” – Remote employees keep standard office hours but are location independent. Their office is wherever they are.
  2. DeskPlus: “Partially office-based” – DeskPlus employees keep standard office hours and are partially location independent.
  3. TravelLite: “Minimal travel requirements” – TravelLite employees have minimal to no travel, with a maximum limit of 10% travel annually.
  4. TimeShift: “Standardly unconventional hours” – TimeShift employees reorder their working hours to create a set but unconventional schedule (outside of 9-5 conventions) that optimizes their productivity and performance.
  5. MicroAgility: “Freedom to adapt” – MicroAgility employees have the autonomy to step away from their work 1-3 hours at a time to accommodate the unexpected.
  6. PartTime: “Reduced workload” – PartTime employees serve in senior-level roles; they have the experience and skills to meet the company objectives on a reduced hours schedule.

 

Managers who claim to know the future are more often dangerous fools than great visionaries

As complex systems go, the interaction between the ball in flight and the moving fieldsman is still relatively simple. In principle, most of the knowledge needed to compute trajectories and devise an optimal strategy is available: we just don’t have the instruments or the time for analysis and computation. More often, the relevant information is not even potentially knowable. The skill of the sports player is not the result of superior knowledge of the future, but of an ability to employ and execute good strategies for making decisions in a complex and changing world. The same qualities are characteristic of the successful executive. Managers who know the future are more often dangerous fools than great visionaries.

(…) Good predictions may be available in structured, well-ordered, situations – but, even then, forecasts are properly conditional or probabilistic. There are few certainties about the future: but one is that hedgehogs who make confident statements on the basis of some universal theory will be as persistently misleading counselors in the future as in the past. And that the foxes (…) who scramble everywhere for scraps of information will provide better, if more nuanced, advice.

via John Kay.

 

The dumbest idea in the world: maximizing shareholder value

A Forbes piece on Roger Martin‘s book Fixing the Game: Bubbles, Crashes, and What Capitalism Can Learn from the NFL. I have not read the book yet. But I definitely will.

The “real market,” Martin explains, is the world in which factories are built, products are designed and produced, real products and services are bought and sold, revenues are earned, expenses are paid, and real dollars of profit show up on the bottom line. That is the world that executives control—at least to some extent.

The expectations market is the world in which shares in companies are traded between investors—in other words, the stock market. In this market, investors assess the real market activities of a company today and, on the basis of that assessment, form expectations as to how the company is likely to perform in the future. The consensus view of all investors and potential investors as to expectations of future performance shapes the stock price of the company.

“What would lead [a CEO],” asks Martin, “to do the hard, long-term work of substantially improving real-market performance when she can choose to work on simply raising expectations instead? Even if she has a performance bonus tied to real-market metrics, the size of that bonus now typically pales in comparison with the size of her stock-based incentives. Expectations are where the money is. And of course, improving real-market performance is the hardest and slowest way to increase expectations from the existing level.”

via Forbes.

 

Dear user: No, we don’t do that

via Scripting News:

Sometimes you just have to say no to users. No, we don’t do that.

If you want that feature feel free to get X, where X is the name of an app that promises to provide the annoying functionality. Especially when there’s such a simple solution to the problem that requires the user basically giving up nothing.

Similarly, sometimes you just have to fire your customer.

 

Best way to plan is to look backward

Invert, always invert.” Turn a situation or problem upside down. Look at it backward. What’s in it for the other guy? What happens if all our plans go wrong?

Where don’t we want to go, and how do you get there? Instead of looking for success, make a list of how to fail instead — through sloth, envy, resentment, self-pity, entitlement, and the mental habits of self-defeat. Avoid these qualities and you will have success.

Tell me where I’m going to die, that is, so I don’t go there.

Charlie Munger quoted in Warren Buffett, The snowball, p. 770.

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The customer is always

Sometimes the obvious is worth repeating:

You need to know who your customers are and what you are offering them. If it is rock-bottom prices, you need to be cheaper than anyone else. If it is a glitzy department store, glitz is what you have to provide. (…)

Customers may not always be right, but they certainly matter. Unless you can give them what your competitors cannot, you have no business.

via FT.com.

 

 

Not just for profit: corporate design for social purpose

When Muhammad Yunus and the Grameen Bank received the Nobel Peace Prize in October 2006, one endeavor lifted into the limelight was Grameen Danone Foods Ltd.

This was a pathbreaking collaborative en­terprise, launched that year as a 50–50 joint venture between Groupe Danone — the US$16 billion multinational yogurt maker — and the Grameen companies Yunus had cofounded. Yunus called the joint venture a “social business,” which he said could be a pioneering model for a more humane form of capitalism.

As Yunus explained in his book Creating a World without Poverty: Social Business and the Future of Capitalism, a social business is a profit-making company driven by a larger mission. It carries the energy and entrepreneurship of the private sector, raises capital through the market economy, and deals with “products, services, customers, markets, expenses, and revenues — but with the profit-maximization principle replaced by the social-benefit principle.”

The mission of Grameen Danone Foods is to bring affordable nutrition to malnourished children in Bangladesh with a fortified yogurt, under the brand name Shokti Doi (which means “yogurt for power” in Bengali, the country’s language). (…)

Like a conventional business, Grameen Danone must recover its full costs from operations. Yet, like a nonprofit, it is driven by a cause rather than by profit. If all goes well, investors will receive only a token 1 percent annual dividend, with all other profits being plowed back into the business. The venture’s primary aim is to create social benefits for those whose lives the company touches.

For years, critics of the corporation have argued that the prevailing design of publicly held corporations is innately flawed. That design involves a board that is elected by shareholders — with votes allocated proportionately to the number of shares held — whose members then appoint a semiautonomous CEO as the shareholders’ agent, who in turn delegates authority down through the ranks. In many ways, this has been a highly effective model. The “managerial hierarchy” structure, as corporate historian Alfred D. Chandler Jr. called it, has ac­complished more in a short time than any other form the world has known.

But this shareholder-centric model has also contributed over the years to what former Citigroup CEO John Reed has called the “iron triangle of short-term pressures” — hedge funds, stock options, and stock analysts — that keeps companies narrowly focused on quarterly profits.

The financial meltdown of 2008 was a direct result of the pursuit of immediate profit by investment bankers and mortgage brokers who disregarded the impact of their actions on customers, on the larger economy, and indeed on stockholders and the company itself in the long term. Those who wanted to operate with integrity found it difficult. They were constrained by a corporate design that reinforced the need to “make the numbers” by any means possible

One helpful way of thinking about these designs is as representing a hybrid between the traditional for-profit archetype, which has profit at its nucleus, and the traditional nonprofit archetype, which has social mission at its nucleus. This type of hybrid has been dubbed the “for-benefit enterprise”, (…) a new type of organization with a blended purpose at its core: serving a living mission and making a profit in the process.

The essential framework of such a company — its ownership, governance, capitalization, and compensation structures — are designed to support this dual mission. And it is this design that enables companies to escape the pressure to maximize short-term profits and instead to fulfill a more fundamental purpose of economic activity: to meet human needs and be of benefit to life.

Today, at least three broad approaches to for-benefit architecture offer promising models:

  1. Stakeholder-owned companies, which put ownership in the hands of nonfinancial stakeholders;
  2. Mission-controlled companies, which separate ownership and profits from control and organizational direction; and
  3. Public–private hybrids, where profit-driven and mission-driven design elements are combined to create unique structures.

Read on at Not Just for Profit.

 

 

When “a perfect storm” is actually a failure of leadership

A bit of unsolicited advice to business executives trying to explain why their company or their industry is suddenly in the soup:

Please spare us the “perfect storm” metaphor.

It’s hackneyed, for starters. It doesn’t square with the facts. And for people who fancy themselves leaders, it’s downright unbecoming.

The reason the perfect storm is such an appealing metaphor for these shipwrecked captains of industry is that it appears to let them off the hook. After all, who can blame you if the ship goes down in one of those freak, once-in-a-century storms that result when three weather systems collide? It’s an act of nature that nobody could have predicted — or so the story goes. (…)

The first thing to understand about the perfect-storm defense is that these guys actually buy into this nonsense. (…)  The second thing to understand is that, fundamentally, they’re wrong. (…)

What capsized the economy was not a perfect storm but a widespread failure of business leadership — a failure that is only compounded when executives refuse to take responsibility for their misjudgments and apologize.

via Steven Pearlstein at The Washington Post.

 

French-American culture clash

A trans-Atlantic culture clash at Alcatel-Lucent, the French-American telecommunications equipment maker created in a $10.7 billion merger two years ago, hit home when the company’s top two executives said they would step down.

Patricia F. Russo, the American chief executive, and Serge Tchuruk, the French chairman, said they would leave this year. The departures of the two executives, who engineered the original deal, follow months of pressure from shareholders upset over billions of dollars in losses since the companies combined.

Analysts were skeptical from the start about the acquisition of Lucent Technologies, based in Murray Hill, N.J., by Alcatel, based in Paris. Initial talks broke down in 2001, four years before a deal was announced, because executives at the two companies could not agree on how to share control. (…) “[I]f you take two guys with broken legs and tie a rope around them, they aren’t going to walk better,” Mr. Kerravala said.

The appointment of Ms. Russo, the former Lucent chief, as the leader of the combined company struck many as a recipe for misunderstandings. Ms. Russo does not speak French comfortably, and the language barrier is one of several cultural challenges that have troubled the company.

Roger Entner, a senior vice president and telecommunications analyst for Nielsen IAG, a market research firm, said that Lucent executives had also struggled to understand the close interplay between French bureaucrats and private-sector executives.