Fast Follower: Are you having a laugh?

It’s been a while since I delivered a full on ranty blog but after a couple of weeks interviewing executives about innovation I’m now fully in the mood for a good old, eye rolling, eyebrow raising hissy fit.  Why?

Because I am sick to the back teeth of people who are so far behind the game when it comes to Innovation justifying their piteous position with the use of the phrase “strategically we see ourselves as fast followers”.   Aaargh!

Since the mid 00’s the concept of fast followership has slowly percolated its way into the lexicon of business language.  Today, it has managed to migrate so far away from its original meaning and purpose that we can award it full membership of the business “bullshit bingo” Hall of Fame.    Originally it was used in relation to those who were actually carrying out innovation and alluded to a well thought out strategy of how to bring “new cutting edge products” to market at a speed that afforded most of the benefits of first mover advantage but avoided some of the costs.  The clue to the purpose of the phrase lay in the words themselves, FAST (as in actually happening, rapidly, at pace with meaning and intent) and FOLLOWER (as in actually moving closely enough to be associated with the leader).  Those firms who truly adhered to the fast follower philosophy and strategy designed and built organisations that were designed to deliver new products to a mass market by a) copying almost exactly someone else’s intellectual property or b) enhancing some prototype development and using the strength of their global distribution networks to drive sales.

Today the term fast follower is confidently offered up by myriads of executives as a Pilate like excuse to exonerate themselves and their organisations recurrent failure to deliver innovation (which in their organisation’s case usually means really old stuff that everybody else now does) at the speed of a laconic glacier.  

Come on people – let’s get with it.  I have yet to meet more than the tiniest handful of organisations that actually do have a thought through and structured fast follower strategy (and they are mostly in pharmaceuticals).  Instead I have met many organisations and executives who claim immunity from the charge of “you and your organisation are actually pretty crap at innovation” with a wistful look, an apathetic shrug of the shoulder, a beatific smile and a gentle utterance of the “but we’ve chosen to be a fast follower” mantra.  You haven’t – you’re just bad at innovation.

I could go on, but I won’t.  I should know better, I’m 45 for God’s sake.  Ranting over for now.

Olympics 2012: What the employers’ guides do not tell you

This week’s blog is a Guest Blog from my colleague at Capgemini Anjali Pendlebury-Green.  Anjali heads up the Employee Transformation practice at Capgemini and is a leading thinker on the practices of HR professionals.  This blog is a classic case of a good point, well made.  I hope you enjoy reading it as much as I did

Last week, my friends and I went on our regular dinner catch up. Two of them are HR professionals at a London government agency whilst the other is an organisation development professional at a city bank. As must be common when a couple of Londoners meet up, our conversation turned to the Olympics, with my government agency friends telling us that they, along with most of the other support staff, were going to be redeployed by their employer to frontline customer facing roles for the Olympics.

                     

They excitedly described the roles that they were going to play and how they expected the general public who would be their customers through this redeployment period to interact with them. One of them went to the extent to state that while back-office staff had been redeployed only for a restricted period of time during the Olympics, she would have really liked to be redeployed for the duration of the period as her contribution. After all, the whole organisation was going to be focussed on the Games.

My city friend then piped up saying that her organisation was doing the same and redeploying staff in front line roles such as their call centre, which they expected would be really busy. Again she was excited by this as this meant that for the first time she had the opportunity to walk in her internal clients’ shoes and experience what they did. This, she thought, would make her more effective in her role.

What really struck me how each of these individuals was really looking forward to the opportunity offered to them by their organisation to contribute to the Olympics effort and to feel a part of ‘making it happen’. Yet when I google advice for HR professionals  around the Olympics, the literature available primarily focussed on managing absenteeism, Games related sickies and setting policies around Olympics holidays.

Yet here was a completely different angle and opportunity that most employers may have been missing. ‘Your Olympics ‘get ready’ plan may well be a great employee engagement tool’.  After all the CIPD UK British employee engagement report  indicates that 33% of employees are interested in helping their organisation achieve its goals and want more involvement in doing so.

What had my friends excited were the following:

"Working in the roles that my internal customers perform makes me more effective": Stepping into the shoes of my clients means that no longer do I not ‘get it’. If you are one of the organisations that can offer back office staff the opportunity to work in alternate roles, do discuss the benefits. After all job swaps/workshadowing offers improved internal communications and team working, encourages out of the box thinking and even helps clarify career development and movement opportunities.
"I feel like I can contribute and am not missing out on the action anymore":  The Olympics 2012 is the greatest show in London. Yet several individuals who have the desire to be a part of this have not yet found the opportunity as they have either been rejected as volunteers or just don’t have the right avenue. If you are involving them in your organisation ‘get ready’ initiative, do explain this in your communications. After all, everyone would like to attend the Olympic party.
"I received training to do this other job": Most relevant for Gen Y employees, the opportunity to train in and gain experience in alternate skill sets is a unique engagement lever.
"Even our senior leaders are getting involved": Leaders should lead by practice. This not only sets an example and advocates a participative culture, but also makes them accessible to their staff.

From the employer perspective,

• Redeploying back office staff to the frontline as part of your get ready plan delivers better value than hiring temporary staff. Your staff know your business better than temporary staff and the training investment goes towards multi-skilling your existing staff base and is no longer a short term spend.
• Cross training and working across teams gives your employees a broader perspective of what your business does and involves them in areas that they would never otherwise see or experience.
• From a longer term perspective, your Olympic get ready plan, could help you test the viability of job swaps as an embedded training and even career development tool , to be used on an ongoing basis.

So it’s not too late to think of your Olympic get ready plan as great tool to invest in and engage with your workforce and create a win – win situation.

Why Innovation Matters – A very personal perspective

Whilst I’m relatively “touchy feely”, I’m sure that I have always been slightly wary of people who have “over shared” in order to make their point.

So, at the risk of being a walking cliché and “over sharing” I want to take the remaining space in this blog to talk about a source of my ongoing passion for Innovation.

For the last 6 years, I and my immediate family and friends have all had front row seats to observe, (fairly helplessly), the slow and pernicious deterioration in my Mum’s mental capacities as she succumbs to ever deeper levels of Alzheimer’s. 

For those not familiar with Alzheimer’s it is currently an incurable disease of the nervous system that slowly strips away from its sufferers the ability to remember the details of life whilst often simultaneously gifting them with low grade paranoia, an inability to initiate activities, crankiness, aggressiveness and social inappropriateness.  Due to the nature of the disease it is not unusual for a sufferer, to not only lose themselves, but to also damage the key relationships they had worked so hard to build up during their lives leaving them truly isolated and alone. What is particularly scary is that 1 in 3 of us will die whilst suffering from some level of Alzheimer’s

So what does all this have to do with my ongoing passion for Innovation? Well, when you watch someone you care about lose, piece by piece, all that matters to them it doesn’t half give you a reminder that life is to be lived today and more than anything else, it is the quality rather than the quantity of that life that really matters.  So what I really love doing is working with people who look to innovate, not only to improve the quantity of their profits but to improve the quality of the lives of their customers, employees and communities.  It takes no more than 10 seconds of reflection on my Mum’s situation (she started showing signs of Alzheimer’s in her early 60’s) to remember and remind myself that life is just too short.  It’s too short not to celebrate and encourage those researchers and innovators who work to make life better – I thank you.  It’s too short to do anything other than pour myself out to improve the way people work and live. That, for me, is time well spent.  Innovation should not merely be about “clever financial engineering to maximise profit” – it should be about the application of our passion, intellect and humanity to wrestle with and overcome life’s big problems.

Thank you for having the grace to have read this far in what reads like a very cheesy blog – not sure how else I could have written it.  More pacey blog to follow next week.

Goldman Sachs PR team are brilliant and fully deserve their massive bonuses

If you are a regular reader of this blog you may be forgiven for thinking that, given the title of this blog, I have taken leave of my critical faculties, have secretly been sniffing glue or am now co-habiting with a member of the Goldman Sachs (GS) PR team.  Thankfully none of these is true. 

However, credit where credit is due.  Last month, Greg Davies, a very senior GS Executive very publicly lobbed a massively incendiary letter into the heart of the GS business machinery.  See the original letter by following the link below.

http://www.nytimes.com/2012/03/14/opinion/why-i-am-leaving-goldman-sachs.html?_r=2&hp

To sum up and paraphrase, what he said was the following:

1.       The GS environment is now seriously toxic and destructive

2.       The interests of GS’s clients are secondary – making money is primary

3.       The current CEO and the current President, have lost control of the firm and are presiding over a massive decline in moral fibre

4.       To get ahead in GS you need to be able to persuade your clients to buy stuff they neither need or want without regard to its impact on them

5.       Oh and occasionally senior people refer to their clients as Muppets (no surprise there)

The instant result – an immediate 3.4% decline in GS’s share price and a massive swathe of negative press coverage, surely this was a body blow, surely this could be an event of such great a magnitude that it has the ability to topple the GS giant?

The solution – deploy the PR team – first up a master piece of letter writing for internal circulation and external publication, of course.  The note sent by CEO Lloyd Blankfein is reprinted by CNN below.

http://money.cnn.com/2012/03/14/markets/goldman-sachs-greg-smith-statement/index.htm

To sum up and paraphrase what GS said:

1.       When you have 30,000 employees someone’s bound to be unhappy – he’s just a crazy maverick

2.       We don’t believe he’s right – we’re very proud of our firm

3.       Greg didn’t follow the proper processes for registering his complaints – he’s a naughty boy

4.       Here’s another 10 reasons why we are fantastic – we’ve won lots of awards so we must be good

What they didn’t do was respond to any of the big issues – a stroke of genius.  What happens next – and this is the really brilliant play - GS orders an internal review – not to assess whether or not they are morally bankrupt and desperate to rip off their customers (oh no) – instead they set out to find out who has called their clients a muppet – a topic the soundbite hungry press have already latched onto.  The reason this is genius – it totally deflects attention away from the really damaging claims and focuses on an act of behaviour that most people in most businesses have been susceptible too at some time or another when under great stress.  Therefore, when GS weed out the bad mouthers we’ll all look on with admiration at the high standards of behaviour required by GS Execs and almost end up feeling sorry for them.  So how will this all end - no doubt in six months time a couple of mid ranking executives will be reprimanded for “non-client centric behaviour and/or inappropriate use of language”.  The muppet hunt will be over and the scapegoats will be “dealt with internally”.  All will be forgotten and GS will continue on as Masters of the Universe – God Bless their PR.  As for the share price – it’s now about 5% above where it was before Greg’s letter was published – it’s a funny old world.

Simon Cowell – Saviour of Performance Management in the UK

Now I’m not a big fan of constructing a blog around a national stereotype, but.... when it comes to giving direct, straight, unequivocal performance feedback the Brits are, on the whole rubbish.  We have historically been the masters of understatement – happy to describe a shockingly poor performer at work as “slightly below average” and an excellent performer as “not bad”.  We were happy with our understatement and have prided ourselves on our ability to interpret nuance and place greater value on what wasn’t said rather than what was.

That was, of course, before Simon Cowell exploded onto our TV screens and into our National consciousness.   Now unless you have been living under a rock in the Kalahari desert for the last 10 years you are sure to have heard of Simon Cowell – the Svengali of the talent show and now one of the UKs most globally recognised faces (in a recent survey, vastly more people in the US and the Far East recognised him than recognised David Cameron) – and, whether you love him or hate him (he does have that Marmite effect) you can’t help but be impressed with his business acumen and ability to understand what the viewing public want.

But what this blog seeks to explore is the subtle effect his “say it as you see it” feedback may be having on the Brits attitude to Performance Management.  For the first time in our recent history we have a very visible role model who makes his fortune by giving “honest” feedback.  Almost every week for the past 10 years (since Pop Idol in 2002) we have seen Simon and his fellow judges heaping vitriol and/or praise on our fellow countrymen and we have loved it (just check the viewing figures for confirmation).   The funny thing is it’s not what Simon Cowell says, although he does seem to be pretty accurate most of the time, it’s the manner in which he says it that is having a funny effect.

He just says it, no stammering, no obfuscation, no rambling, no embarrassed ums and ers, no blushing, no wringing of hands – just straight, clear feedback (and no, he isn’t Dutch).  Wow, a whole new role model for the people of Britain and I think it may just be starting to have an effect.  Granted, the “Cowell” model has only been around for 10 years and the Nation has been a model of tongue-tied reticence since before the era of Jane Eyre et al but I do believe I’m beginning to see a change in attitude towards performance management.

From my experience of working with businesses over the last 25 years I think I can relatively accurately say that over the last 10 years we do seem to have been getting better at giving and receiving feedback.  Now it may be because we have much more effective performance management systems in place (perhaps), or it may be because we have much better training programmes on giving feedback (possibly), or it may be because we are required by the HR compliance teams in our businesses to actively participate twice a year (maybe) – or it may just be because of the mental picture we can conjure up in our minds of Simon Cowell giving life changing feedback on a week in week out basis.

So for those who are looking to deliver an uplift in their organisations ability to give and receive feedback you have two options a) send a 10 minute video montage of Simon Cowell in action to those staff just about to carry out performance reviews or b) inspire yourself and your leadership team to role model the fine art of giving feedback yourself (scary I know) – now either solution may not make your staff instantly brilliant at giving feedback but it might just help and with solution b) they will at least have another high profile  role model or two to inspire them to be a bit more like the Dutch when appraising their fellow employees performance.

Let me know how it goes.

No rest for Financial Services as the FSA ups the ante with new Conduct Risk guidance

Following in the much appreciated grand tradition of Guest Blogs, this blog is courtesy of Sandra Quinn - Associate Director of Conduct Risk at Capgemini.  Sandra has a very insightful view on Conduct Risk having worked both for the FSA and a major UK Retail Bank as a Risk Director.   

Now, if you are an FS industry watcher you are going to love this.  For everyone else, take note, other regulators are watching with interest how a revamped FSA takes on its responsibilities. This blog focuses on the implications for FS firms following the recent publication of the latest set of guidance from the FSA

With the publication of its second Retail Conduct Risk Outlook, the FSA has set out the priority consumer risks for its attention in 2012/13.

http://www.fsa.gov.uk/static/pubs/other/rcro12.pdf

Conduct Risk – the risk that a financial services firm’s behaviour leads to poor customer outcomes – is high on the FSA’s agenda. And will be higher on the Financial Conduct Authority’s agenda. The clue being in the name.

What the Risk Outlook means for firms is that those looking to stay out of the FSA’s Enforcement Division will need to treat this as their marching orders on conduct and customer risk for the next year and demonstrably get onto seriously examining the risks in their firms and unequivically doing something about them.

The problem for them is that the report highlights 48 risks, with 16 risks new since 2011, covering just about all financial services firms and businesses. Only 3 risks from last year have been relegated, but the FSA says that does not mean they are no longer concerned about them or that firms can now ignore them.

So firms who thought they might look at the list and decide it didn’t apply to them should be disappointed.

And the content and the message is clear - FSA expects all financial services firms to get serious about ensuring they are not creating poor customer results through how they behave.

The RCRO focuses on risks extending from the complexity of products such as structured investment products, through reward and business models, via how firms are responding to regulatory and legal change such as RDR and Solvency II, to cost cutting and how the firms search for business in wealth management and private banking. Packaged accounts and PPI feature, much as expected, with investment risk profiling, investor compensation, general insurance concerns (add ons, PPI, limited value products, initial premia) , governance in life offices, projections and systems weaknesses in network models. 

 It’s a heavy duty list. And as if the list of 48 issues isn’t enough, the RCRO implicitly presents three strategic challenges for firms:

The regulator is increasingly focusing on business models.  This is largely about getting conduct risk prevention embedded in firms. But what the FSA and the RCRO do not sufficiently acknowledge is that a top risk for a firm is now how, in a market of shrinking margins, they make the kind of returns they have built their budgets, business models and shareholder expectations on, in a way which is fair to customers. Or put another way, the risk that firms want to offer the products in the first place.

Some firms are trying to address this by improving efficiency and customer reach through digital transformation. But they need to build management of conduct risk into any proposition to avoid transforming themselves into just being more efficient at making old mistakes – at least from the regulator’s point of view.

And most fundamentally, the FSA’s definition of ‘conduct risk’ means a risk to the FSA’s statutory objective of consumer protection. That’s not the same as a risk for a firm which traditionally focuses on commercial risk and risks arising from the effectiveness of policies and controls. So, firms have to figure out how to align their approach with the FSA’s more strategic and consumer centric approach.

That’s why any firm tackling conduct risk has to bring together compliance, policy, control framework, product and process development, risk identification and regulatory relationship management with self challenging governance, insightful management information, conduct risk informed reward and HR and a more strategic and outward looking risk and customer management capability.

The sooner a firm actions these together, the sooner they will make real inroads on the conduct risks that the FSA is highlighting in firms and for customers and on which it has thrown down the gauntlet.

Why won’t we talk about what the UK should be good at?

It is a sad but true fact, that, at an occasional dinner party or two, I have been known to ask the question, “So, by comparison to global standards what is Britain actually good at?” 

(Note to Readers:  I know, I know, there are quite probably more interesting topics to discuss at dinner parties than this one, but I like it, so please humour me and don’t stop inviting me to dinner parties.)

However, once the question is posed the optimists nonchalantly wade in to open the debate with a “Well of course we’re brilliant at ... (slight frown, embarrassed pause) ....er.... lots of stuff”.  “Such as?” and after much toing and froing, a list of what the UK is truly world class at slowly begins to emerge.  The list is usually made up as follows:

1.     Musicals

2.     Education (only arises at the intellectual dinner parties)

3.     Monarchy

4.     Queuing

5.     Ideation

6.     Eccentricity

7.     Exploring

8.     Add your own

Now the point of this blog is not to actually determine what we are good at, although that would be fabulous, but rather to ask the question, “Why do we never seem to have this conversation anywhere other than dinner parties?”  Surely being clear as to what we are about is a good thing?  Is it because we are actually all too afraid of the answer? 

For instance, if we think we ought to be world class at high end manufacturing we should be aligning our education system, tax system and political system to support that end.  Likewise, but substantially more controversially, if we think we want to be world class at Financial Services we should also align the systems to support that end.  Of course the implication is that by actually deciding what we should be good at we will instantly marginalise a large number of constituents whose interests are not favoured by the answer, never a popular option for any politician.

However, and here’s the rub, the longer we as a nation stick our head in the sand on this issue and fail to have the debate, the less likely we are to be able to choose our own destiny and the more likely we are to genuinely end up being no more than mediocre at anything but the list above.

Of course there are other schools of thought on the necessity of having the debate.  The “Jingoistic” school holds the view that the debate is pointless as anything produced or conceived of in the UK is de facto world class so why do we need a debate we’ll just get on with being British.  There is also the “Ex-Pat” school which holds that it’s too late to have the debate anyway as India and China are already doing everything better so why bother having the debate, let’s just move to Singapore and learn Cantonese.

Whilst these schools do have validity I can’t help feeling that in the year of the Diamond Jubilee and the Olympics we really ought to be able to have the debate.

Looking forward to the opening salvos and an occassional dinner party invite