A look at how transformational change themes apply in practice, with case studies providing practical examples
Date: 16/12/13 Duration: 00:19:40
In this podcast Gareth Jones visiting Professor at the IE Business School, Madrid, and a Fellow of the Centre for Management Development at London Business School outlines the six point plan of an authentic organisation - arranged in an acronym DREAMS.
Gareth Jones and Rob Goffee have written an article entitled 'Creating the best workplace on Earth', published in Harvard Business Review, Vol 91 No 5, May 2013. pp98-106.
View the full podcast transcript
Philippa Lamb: So let’s go through it. ‘DREAMS’ is the acronym.
Gareth Jones: DREAMS - the organisation of your dreams.
GJ: Difference beyond diversity. So people said to us “I want to go to work and be myself.” Or as somebody once said in a very nice way, “My family could recognise me at work.”
PL: What I liked about this was you made the point, I've seen you do a presentation about this, that you’re not talking about diversity here because that's a given. We all understand the value and need and wonders of diversity but this is about difference. I think you expressed it as difference in experience and I think you were saying this is the people working within your organisation and everyone you’re dealing with make that a different experience.
GJ: Sure. It’s about difference of perspective, difference of mindset, difference about assumptions about the world, that's how we get creativity. It’s not about how many women are there, how many ethnic minorities, all of which by the way is hugely important but this is difference beyond diversity. So in fact in the book we're writing right now we have one case of where the whole team looks horribly homogenous, they’re all white middle aged men but actually it’s an intensely diverse organisation.
PL: You have an example around Waitrose with this don’t you?
GJ: Yes. Waitrose, I think it’s very interesting because you’d think about the food retailing business it’s a business that's completely obsessed with process, you know; food chill counters, health and safety. I'm sure that Waitrose do all of that brilliantly but they recognise that small differences in customer experience in the stores is what differentiates Waitrose. They just want people to be able to do things slightly differently and in fact your question has reminded me I always do my Christmas shopping at Waitrose in Worthing and I got there one day and it’s of course very full and there were no sprouts. Well can you imagine Christmas lunch with no sprout?
GJ: I thought I daren’t go home to my family, they’ll lynch me. So I saw a very nice woman on the veg counter and I said, “Listen, I know that there's no sprouts but please scour the store.”
PL: You've got to have sprouts.
GJ: Anyway she went into the back room and she came out with one of those stalks of sprouts stuck up her thing and she said, “Don’t let anyone else see them.” So she had to smuggle them out and I walked out with a stalk of sprouts. Well of course that's what makes shopping at Waitrose very memorable doesn’t it? I think the idea that great supermarkets want to individualise the customer experience requires that inside the stores; they need to nurture characters.
PL: So the phrase I think you use when I heard you speak about it earlier was cohesion; build cohesion but not homogeneity.
PL: Which I think delightfully expresses it and you also talked about encouraging conflict.
GJ: Yes, well what do we know about conflict? We know that creativity comes from conflict, right? We know that you can start to articulate what are your core values in an organisation when people start to challenge them. There's a lovely story I think based on the success of the British rowing team and their injunction when they start, when they first get together is question everything, the seats, the rowlocks, the oars, the paint, question everything. I love the idea that in the clever economy only the curious will survive and of course curiosity engenders conflict.
PL: Bit of a challenge for HR, this; HR doesn’t traditionally like conflict.
GJ: Well I think that the challenge for HR is to make the conflict productive.
PL: Let’s move onto your next letter which is R.
GJ: Radical honesty - tell the truth before someone else does. So our view is that in the world of freedom of information acts and Wikileaks and whistle blowers, the idea that there are corporate secrets is a myth. So tell the truth before someone else does.
PL: And also within the organisation this idea, and I'm afraid it’s HR again, is we can't tell the board that.
GJ: Yes, sanitising bad news is absolutely terribly dangerous, terribly dangerous. I don't think there has yet been a good book written on the financial crisis but quite clearly there were some people who knew that the risk profiles of major banks were much more exposed than they thought they were. I mean it’s kind of crazy to think that some of these ginormous financial institutions like Credit Suisse, UBS, Deutsche Bank, Barclays, Citigroup, had no idea of what their real risk profile was. Well somebody knew.
PL: It takes courage this doesn’t it?
GJ: It takes courage of course, it takes courage.
PL: So in terms of this radical honesty, just bring it down to the ground inside organisations. If you have an intranet where people can say what they like can people do it anonymously or do they have to say who they are?
GJ: Well of course if you really have a culture of trust people will sign their names.
PL: But should they have to?
GJ: Well I don't think it’s about they should have to, it’s in some senses a measure of the cultures.
PL: If they feel able to?
GJ: Yeah if they feel able to. Look at the Novo Nordisk website on soda wars, the attempt to ban sweet fizzy drinks from their buildings.
PL: Because they’re a counter-diabetes organisation.
GJ: Because they’re in the business of eradicating diabetes and you can see really fierce debate but what’s great about it is people sign their names.
PL: Next on E.
GJ: Extra value.
GJ: People want to be in organisations where they feel like their organisation is adding value to them, not exploiting them or extracting value from them. This is a rather Hewlett Packard psychological contract but when you joined Hewlett Packard they used to say, “When you leave us you will have been enriched by the experience.”
PL: It’s a lovely idea.
GJ: So the implicit message was please stay as long as we add value to you and you add value to us. And if both of those conditions are met we’re fine. If they’re not met we’ll part company, no bad blood, no broken promises, no mid career crisis, this is a perfectly open exchange. I'll add value to you if you add value to me. Now when we first started to think about this we were thinking about elite organisations like McKinsey’s and some of the great American hospitals and so on.
PL: It’s easy to see how they would do that isn’t it?
GJ: It’s easy to see those but of course if you take two other examples like LOCOG and what they did with the volunteers.
PL: At the Olympics?
GJ: It’s absolutely stunning, stunning, stunning, stunning. For many of the people they recruited as volunteers this has been a transformational experience.
PL: So they added value to them by letting them be themselves and do a job.
GJ: And by giving them skills. Lots of people will say that great though the Olympics were and fantastic though the buildings were and so on, the really defining characteristic of the London Olympics was the volunteers. I think that's marvellous and for many of those people that began a whole new enriching phase of their lives.
PL: You also talk in the context of this one about training because you see we think adding value to people, training them, giving them skills and that whole thing about how we do that.
GJ: Sure. I mean two quick thoughts. McDonalds for example spend quite a lot of money training relatively uneducated young people in supervisory skills and so on and they take that really seriously. I think that's laudable by the way but as we look at big complex organisations with lots of clever people in them for, example, I think conventional approaches to training are probably looking a little tired. The three days in a not very nice hotel outside Slough are probably over.
PL: So what should it be then if not that?
GJ: I think it can be technology enabled.
GJ: It could be screen-based.
PL: People don’t like that.
GJ: Well I did a thing recently with Cisco Systems; I talked about leadership to a thousand people globally simultaneously. Now of course if anyone can do this Cisco can do it but when I turned up at the studio I kept on thinking, ‘Well where’s the army of technicians, where is it all?’ And we just walked into a small room and the guy pressed a switch and bang it happened and it made me realise that the technology has moved on really fast. I'll give you another example. I've done a lot of work with Credit Suisse over the years; well, getting investment bankers, especially American investment bankers to go to training courses is virtually impossible.
PL: Sure, they’ve always got something more important to do.
GJ: Yeah, you could get an hour with them and that's fine but the idea of running a two day workshop on leadership they just don’t come. So Credit Suisse have been very, very creative in having incredibly short little pieces, five minutes, delivered to people’s PCs. So I have to have a difficult conversation with somebody and I can find something on my PC which will give me some clues as to how I might handle that difficult conversation.
PL: Is the common thread there that it’s people talking rather than data on a screen?
GJ: Well what do we know about what people retain? We know that people don’t remember spreadsheets. They don’t remember long boring documents.
PL: Because a lot of screen-based training is text based isn’t it?
GJ: Yes they tend to remember stories. So I think the idea that effective training is story-based is probably a really good way. So you want to tell stories about how people handle difficult conversations or what things can go wrong. So whenever I'm trying to teach this by the way, I use examples from my own previous career when maybe I've had to fire people or even if I've had one of those difficult conversations where you say, “This is the last time that can happen,” and I talk about how I dress and if I'm wearing my firing suit today.
PL: That's concerning. But that's interesting though because it’s about conversations. So we're saying that however the technical media works, whether it’s screen-based or whatever it is or whether people are on the other side of the world, it’s still about two people talking to each other isn’t it or one talking?
GJ: Well the reason is you see, this is another example of technology slightly running ahead of human evolution. The fact is we've got faces and faces are for data radiation and data collection. Now the idea that human relationships are mediated by technology is not new; Napoleon conducted a love affair with Josephine for 30 years, mainly by letter, but he'd seen her before. He'd seen her before, that's the important thing. So I think we just need to be a bit more creative in thinking about how we deliver training.
PL: Interesting. The next one; A.
GJ: A - authenticity. Fully explore the meaning of authenticity. Now we’d already written quite a lot about authentic leadership but of course now we're talking about the authenticity of organisations - do they mean what they say? Do they really stand for what they say they stand for?
PL: You see that's tricky isn’t it because smart organisations all know how to look like they’re authentic.
GJ: Sure but human beings are smart too and they see through it don’t they?
PL: Well you say that Enron had a fantastic mission statement didn’t they?
PL: What was it again?
GJ: Respect excellence, integrity and communication.
PL: Everyone loves that don’t they?
GJ: Sure, sure.
PL: And that turned out to be Enron.
GJ: Well and of course if you look at the research on branding there's some evidence that people are falling out of love with brands a bit, you know. I bought the shoes and I didn’t run any faster. I bought the aftershave, I didn’t become irresistible. So we have to be very clear when we make statements about what our organisation does that we deliver them.
PL: So it can't be tokenism?
GJ: It’s not. You see, Rob and I used to joke about this when an idea of mission statements became popular a long time ago, so people would ring up and say, “We think we need a mission statement.” So we used to jokingly say, “Well, we’ll jump in the van and come round.” And out of the tub of key words we would pick out excellence, team work, integrity and customer focus - there you are!
PL: And I bet they loved it?
GJ: They loved it yeah. Well that's actually not a mission statement at all is it? This has to be sort of crafted from what people really think the organisation is about. I mean BMW is another one of my favourite organisations and the reason is that if you stop an executive in head office in Munich and say, “What’s BMW all about?” they look at you a bit startled and say, “The ultimate driving experience.” Now they’re not saying it as a strapline, they’re not saying it like a marketing line. They’re saying it’s true.
PL: They’re not? Because it sounds glib.
GJ: Well if you get caught drink driving in a BMW you get fired. You've just abused the ultimate driving experience.
PL: So they believe it that's the point?
GJ: They believe it yeah. Of undisputed origins is the definition of authenticity and I think authentic organisations have a very clear idea where they come from and, by the way, you don’t have to be old to do this so this is one of my favourite old Apple stories. Apple have just developed the prototype of the Macintosh, it’s called Lisa, and they take it to Digital and Digital laugh in their face and say, “we don’t deal with this sort of stuff, this is small potatoes. Go back to California and smoke some more dope.” And the next day a giant lorry arrives at Digital’s headquarters and in it is a wreath and it says, “Digital rest in peace - Apple.”
GJ: And the great thing about the story of course is that Digital doesn’t exist any more and Apple is arguably the greatest company in the world. By the way if you hang around with old Apple executives, because of course there are old Apple executives, they will always tell you that story. They will always tell you that story.
PL: So in their hearts that's where they came from?
GJ: That's where they came from.
PL: That cheeky...
PL: …out with the old in with the new. We're not scared.
GJ: Clever stuff, Lisa was clever, we couldn’t quite know how to make it work but Lisa was clever.
PL: Okay right we're going to go onto our last two letters in your acronym and the penultimate one is M.
GJ: M for meaning. So there's a long literature on this by the way, people want to do meaningful work in an organisation which itself has meaning. Now at this point people sometimes say, “Well it’s all very well for you Gareth, you talk about the music business and pharmaceutical companies and the BBC and so on.”
PL: It’s easy to see the meaning.
GJ: It’s easy. Okay this is my view. What’s banking all about? Banking’s about giving your parents a decent retirement, paying for your kids to go through college, surviving redundancy, refinancing your business, buying that boat you've always wanted, surviving a serious illness. Banking’s really exciting. What’s insurance about? Insurance is about having your roof repaired in time for Christmas, having your courtesy car when your car’s been stolen. Insurance is really exciting. The task of the leader is to find what’s exciting and communicate it to the rest of the organisation.
PL: So that everyone, top to bottom, has a clear connection between the job they’re doing and the outcome?
GJ: What are supermarkets about? Supermarkets are about putting great food on people’s plates. I think you can get excited about food retailing. You can get really excited about waste disposal.
PL: So it’s about whatever your business is, building this idea of a collective cause, without sounding too ra-ra-ra about it.
GJ: Absolutely it’s about what’s this really about? What are we really doing? Education I often say to people, “I defy you to come to London Business School for one week and not feel excited. You will be surrounded by buzzy, clever young MBA students and slightly nutty faculty and there'll be people from all over the world there and you might not like it but I promise you you'll be excited.”
PL: Last letter S.
GJ: This is perhaps the hardest one of all - simple rules. So people want to work in simplified rule environment in which there are as few rules as possible which we all agree about. Now this is really hard in the modern world because you’re seeing regulation become ever more intrusive but we're not convinced that you can produce an ethical financial services sector simply through regulation. The kind of clever people that you find at the big investment banks like Goldman Sachs will find their way through the regulations, absolutely. What we need is a simplified rule environment in which we all agree what the rules are and the rules will probably embody significant ethical components.
PL: And build on trust?
GJ: And build on trust, absolutely. You see otherwise we have to keep on checking on people and checking on people to see whether they’ve broken the rules or not adds enormously to cost.
PL: But as you say obviously there's a tension there, compliance, legal stuff and all that.
GJ: Of course and we in society need a big debate about what the limits of regulation are. I went and gave a lecture at a conference in Miami recently and it was to US hedge fund managers. This was about two years after the crash and I met the team from Goldman Sachs that had developed the sub-prime product; what do you think they were thinking of next? The next one. The next one. And by the way I don't think there's a set of regulations in the world that could control these clever people. What we needed is a set of sort of moral principles, simple rules which we all understand because we certainly couldn’t survive another financial crisis like the one we've just had. And then Philippa, I think there's another element to this. Of course some people like the proliferation of rules and in particular what sociologists call Mock Rules because mock rules give you two kinds of power; the power to enforce the rules or the power to ignore them. And actually my early experiences at the BBC was that there was an enormous number of mock rules which actually led to the abuse of power.
PL: And is this the challenge in all this for HR for you? I'm getting the sense that it is.
PL: That HR has to be brave enough to give up some of that turf.
GJ: Absolutely. I mean I think we slightly jokingly said we've written this article called Close down the department of rules, as yet unpublished, but you know it’s about the HR department.
PL: But that's where their power base is laying isn’t it?
GJ: Well I think we've got to move on from the world where HR is the person who wraps a process around everything.
PL: To a place where HR is an enabler?
GJ: It’s an enabler. It’s about delivering what the organisation really, really needs to do. So it’s about focusing on what the key outcomes of this organisation are and making sure that we build organisational architecture, what Rob and I call social architecture, which enables you to deliver what it is that you really think is important. You see I would like to think of HR people as social architects putting in place structures and cultures and accountabilities and responsibilities which enable organisations to do what they really, really should be doing. When I was at the BBC people used to sometimes say to me, “Gareth, what are you going to do with the Natural History Unit?” and I would say, “Nothing. I'm going to leave it alone. I'm just going to try and make sure it gets enough money because these people make the best natural history programmes in the world so I'll just let them do it.” And of course we might want to help them with bringing in people from other organisations. We might want to help them with technology and so on but actually they’re very clear about what their purpose is.
PL: So just to wrap this up, looking at your DREAMS acronym, obviously you talk to all sorts of organisations all the time. Do you get a sense that this is a movement that is coming forward, that people understand this stuff, they’re aspiring to it? Okay they’re not there yet but that the general sense of what makes a good workplace is now better understood?
GJ: Absolutely. Let’s just take the opposite of dreams, so you don’t believe in difference, you believe in sameness. Don’t believe in honesty, you believe in telling lies. You don’t believe in adding value, you believe in extracting value. Don’t believe in authenticity, you believe in inauthenticity. You would like work to be meaningless and by the way you’d like to drown in a fog of rules. No. You see the opposite isn’t very desirable at all is it?
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