What I Learned From MDP- Week 1
December 9, 2008 | by brett | Permalink
For those of you who don’t know, Zach and I are going through Jobing.com’s Management Development Program (MDP), described as a ‘mini MBA,’ an eighteen month course that covers business topics ranging from ‘Strategic Marketing’ to ‘Execution.’ We, along with 16 other Jobing.com employees from across the country, just finished our introductory course taught primarily from Aaron Matos, the founder and CEO of Jobing.com. Needless to say, I don’t feel a single minute was wasted.
Since we’ll be covering a new topic in the program every 2-4 weeks, I figure it’d be good for myself to reflect on the material by posting it here on the blog. And I think you’ll find that my takeaways will help you understand some really cool things, not all of which will be business related.
So without further ado, here’s some of the notes and afterthoughts on the material we covered this weekend.
Business is just a language. If you learn the terms, the words, the concepts, you’ll be able to hang.
July 11th, 2010. That’s the day I ‘graduate.’
Business. A business has three components. It has a purpose, or mission. It has competencies that make it good at what it does. It has an environment that makes up the organization. You team up all three of these things and match it up against reality. Reality determines whether those three components are worthy of profits.
Leader vs. Manager. Which would you rather be? Why?
I bet the majority of you said leader. Many of us today consider ourselves a leader. But how is a leader different than a manager? Do you have to be a leader to be a manager? Do you have to be a manager to be a leader?
If you read Peter Drucker’s article, Management and the World of Work, he doesn’t use the word ‘leader’ once. He lists about seven things that categorize a good manager at the end of the article, and if you substitute the word ‘leader,’ it takes on the same meaning.
This is a game of semantics. There’s no difference between the two. The word ‘manager’ is just negatively stereotyped word used to describe someone who oversees a business. It’s a relatively new word created to describe the people who oversaw factory and domestic production in the Industrial Revolution.
Today it’s negatively stereotyped because when we think of a manager, we think of an institutionalized person who watches your every move. Just say the word. Manager. It just comes out sounding bad.
A leader is the buzzword of business today. Companies have ‘leadership’ training and there’s a few hundred books about leadership today, just as there were a few hundred books produced about management yesterday.
The word today is leader, yesterday it was manager, and tomorrow it will be catalyst. Or chief. Or principal. Think about it and if you disagree let me know be commenting on the blog below.
What is a business for?
Simple question right? Not so much. The answer is always going to have ambiguous aspects to it. Much of the ambiguity revolves around this idea of ‘corporate social responsibility.’
Milton Friedman believes that the bottom line for social responsibility should be to maximize profits within the law and ethics. The only responsibility you have is for your shareholders. Any corporate social responsibility can be done on the individual level if the employee chooses to do so.
The pro to this belief is that the answer to the question of what a business is for is clear: you’re in business to make money. The con to this belief is that business is now widely global. What would happen if business were to have the same global customs and law? If it were consistent, if the United States had the same laws and customs as Egypt, there would be problems. So it’s a problem with the definition, therefore a problem with Milton’s theory.
For those that don’t like the extreme angle that Milton takes about business, the Business Roundtable argues that a business is to raise profits and social welfare. The problem here is the question, ‘how do you weigh the constitutes? How do you know if you’re being socially responsible? The pro is that responsibility extends further than Friedman’s in the sense that a business is not only responsible to maximize it’s profits for it’s shareholders, but is also responsible for keeping it’s employees employed, the community a better place, and the customers with the best product.
In the end, profit allows you to continue. That’s all I’ll say.
Law of Dividends: Investing in the Team Compounds Over Time
If you invest in individuals, that makes them better at their job, which makes you more money. If you invest in individuals, that makes a stronger team, which increases the potential of what they are able to achieve.
Jobing.com has obviously bought into the law of dividends by investing in new employees with a two week orientation process and current employees with programs such as the MDP or Leading You.
The only way this won’t work is if all the knowledge the company invests stays within the group. Because then, it doesn’t compound, and doesn’t pay off.
Why don’t more sales teams do this?
Why don’t sales people tell the client right away what’s most important to them. Example:
Sales guy: You know what’s really important to me? Getting you as a client. What’s really important to you?
After that’s out of the way, you can cut the crap and figure out how to work together.
A Dissymmetry
In life, in business, in case studies, there’s a divide between the information you have and the interests that individuals have. Sometimes people are really motivated by a certain thing and you’d never know it unless you asked the right questions. If you go into a situation with the right questions, or even the intuition to ask questions to get to the root, the part that really motivates people, you’ll be able to eliminate the dissymmetry.
Mount Everest Disaster (1996) – a film by David Brashear
The last line in the movie: It’s what the mountain reveals about us that has any lasting value.
Fatal Ascent: Leadership Lessons From ’96 Mount Everest
The ’96 disaster on Mount Everest was one of the deadliest in the history of the mountain. There were two groups that went up, and a lot of things went wrong. You’d be hard pressed to find some things the leaders did right.
An easy thing to do when there is a disaster like this, or a failure like this in business, is to seek the ‘root cause.’ People want to find the ‘one thing’ that caused the failure to happen. The thing is that there isn’t just one thing that made the failure happen. There’s not just ‘one’ person responsible for the failure. In order to tackle a failure, there has to be a framework of thinking.
The framework of thinking:
Individual Decision Makers: these are just ordinary people with cognitive limitations and biases. There are three different biases people have:
1) Sunk cost effect- You’ve spent so much money, so much time, so much energy and effort that there’s no way an individual wants to give up, even when it’s the right decision. There was one guy who died on Everest. The previous year he came within 300 feet of reaching the summit before having to turn back. He worked two jobs throughout the year to help finance the $65,000 Everest fee. He trained for over six months. There was no way he was going to give up if he was still breathing. But this sunk cost bias cost him his life. You can’t throw good money after bad- sound familiar?
2) Overconfidence bias- people believing they can do it. One leader said Everest had a yellow brick road to the top because of the experience his team had. They didn’t make it.
3) Recency effect- we have a tendency to base our decisions on what was most recent, not on our full experience.
Team Effectiveness: in order to ensure psychological safety, teams need to challenge existing views, express dissent, have candid dialogue, and constructive conflict. The teams at Everest didn’t have that.
The conditions that diminish psychological safety include:
1) Member status differences- picture a meeting with a VP and an entry level employee. Don’t you think the entry level employee would be discouraged to challenge the existing view of the VP?
2) Leader Coaching & Support- the way that leaders lead sometimes can be authoritarian and as a result, can cut off communication or any oncoming challenges.
3) Level of Familiarity/Prior Interaction- are you more comfortable talking with a stranger or a friend?
If the team wants to be effective, they have to consciously diminish these conditions.
Organizational Level- Complex Systems
1) Time dependent process
2) Rigid sequence of activities- Everest is a very complex organism. Everest breaks down system with a vengeance. Having a rigid sequence of activities doesn’t allow an organization to adapt.
3) One path to achieving a goal
4) Very little slack
If any of these four elements occur, organizations are prone to big failures.
Taking these three levels of why failures may occur- individuals, teams, organizations- you realize it’s much more complex of why that failure occurred. It’s much more than one reason or a root cause. By analyzing failure from a holistic angle, you’re able to see that it’s all integrated. Individuals. Groups. Organizations.
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