Tag: inner growth

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Go beyond “lift and shift” to build new markets

The most recent Hay Group newsletter continues its series on the World’s Most Admired Companies. This edition focuses on PepsiCo and its drive for innovation and a healthier portfolio of products.  Take a read.

The Leadership Professor calls your attention to two key issues: 

1.  PepsiCo’s belief in the importance of personal development: “You can’t have business growth without personal growth.” Amen!

2.  Innovation and creative thinking – not simple “lift and shift” of the same old products to new markets – will drive Pepsico’s future. The company is hiring different kinds of folks to encourage new thinking and what Clayton Christensen calls “disruptive innovation.”

Interesting for us all to think how much of what we do to grow our programs and organizations is “lift and shift.”  What can you do to drive real innovation and creativity in your organization?

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PepsiCo: Driving hard into emerging markets

With nineteen billion-dollar brands, PepsiCo is home to some of the world’s powerhouse food and drink brands. In recent years the company has expanded internationally and is looking to emerging markets for growth. At the same time it’s moving to a more nutritionally responsible portfolio of products. SVP of talent management David Henderson outlines PepsiCo’s growth strategy and how it’s using innovation and people to reach its goals.

The 2011 World’s Most Admired Companies survey revealed a focus on growth, especially in emerging markets and for high-growth business units. How does that resonate with PepsiCo?

First, in developed markets we’re aiming to do more with less, unlocking operating synergies and freeing up investment capital for our emerging markets and nutrition businesses. Growing share in key emerging markets is our next priority: for example we just bought a very large market-leading dairy company in Russia which makes us the largest food and beverage company in that key market for us. Overall, we anticipate that emerging markets will grow from 30 to 45 per cent of our next revenue mix over the next five years. Our third priority is developing our nutrition portfolio, offering a more balanced portfolio of enjoyable and wholesome foods and beverages.

Has recession affected your growth strategy?

Yes, in that commodity prices have gone up very significantly, consumers are spending less and retailers are consumed with the concept of value. So we’ve had to look internally and probably harder than ever before for operating efficiency, because it would be irresponsible to pass the cost of this on to the consumer. And also we’ve shifted the portfolio mix over that period.

"We’ve been really surgical and forensic around which markets offer the best growth prospects"

Another theme this year was innovation. What does PepsiCo do to drive and foster it?

A few years ago we started a process called ‘Innovation and Growth Planning’, where we moved from a three to a five-year horizon to help drive breakthrough innovation. Then to support this we brought in people from outside to disrupt our dominant logic, for example hiring a chief scientific officer from a pharmaceutical background. We changed our operating model from ‘lift and shift’ – where we transfer successful products to different markets – to a faster-moving mode where a globally matrixed organization has R&D ‘hardwired’ in and a multidisciplinary global nutrition group drives new innovations.

What challenges have you had spreading this culture of innovation and keeping it alive?

We’ve a few of examples and failures where innovations cannibalize other products, taking share away from more profitable products. But if you accept that more of your growth is going to come longer-term from innovation and more of that is going to be breakthrough (farther out) innovation, inevitably your failure rate is going to go up. So we have to build a culture that’s more risk tolerant. You’ve got to almost encourage people to forget what has made them successful in the past.

"You need ‘keepers of the flame’ and a few mavericks in there who are really going to shake things up"

Employee involvement was another characteristic of Most Admired Companies this year. What does PepsiCo do in this area?

This comes right back to the heart of our performance management systems. We have a model of performance management in PepsiCo which is geared fifty per cent on business results and fifty per cent on people results. And that’s true for every manager from the CEO of the company right through to first level supervisors in the organization. For example our ‘Manager quality performance index’ uses a set of twelve very simple questions that are consistent right across the organization. They’re heavily geared towards how effectively the manager is in engaging with the employees on his or her team. We baseline the manager’s performance and then we’ll track that over the twelve month period.

Building on this point, enabling employees to succeed is something Most Admired Companies have focused on. How does PepsiCo approach this?

"Our philosophy is that you can’t have business growth without personal growth"

In fact, they’re inseparable. When the business is growing and you’ve got employees that are themselves growing professionally it’s a very powerful combination and one can really drive the other. For us the most effective formula has been one of continuous learning and development through the organization. We also segment our talent, for example based on who’s prepared to be mobile and who wants to stay where they are. It helps us better manage both personal life and professional life considerations.

Are there generational issues or any other new issues that you’re keeping an eye out for?

Talent scarcity is an issue. R&D is one of the hardest areas to recruit into because there’s such demand for companies that are looking. There’s just not enough talent coming through into the market at the right skill levels.  In emerging markets, the talent is less bonded to the company because there’s greater demand. This scarcity is a constraining factor on our growth. Voluntary attrition has dropped very significantly, so there is an aging demographic in a lot of organizations. Too many leaders will be exiting the organization in the next five to ten years. And it also means we need a delicate balancing act between continuity and potential.

PepsiCo was number 26 on the 2011 FORTUNE World’s Most Admired Companies list.

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Jeremy Lin: A Teaching Case on Succeeding in a Complex World

I love the Jeremy Lin story – the humble, smart, sudden NBA superstar for the Knicks who until a few weeks ago was sleeping on his brother’s couch and wondering his future with the sport he loved. [If you need to catch-up on Lin-sanity, check out the Washington Post story on how his talent went unnoticed for so long or one of the many New York Times sport columns.]

This is a great basketball story – a living remake of the movie classic “Hoosiers.” It’s an American morality tale of hard work, immigrant family, humility, following a dream, and success against the odds. It’s also a teaching case about how to succeed in an increasing complex world.

Forbes columnist Eric Jackson identifies 10 lessons from Jeremy Lin to enrich our lives and work. Let me post and discuss.

1. Believe in yourself when no one else does. Only the 4th Harvard grad to make it to the NBA. One of only a handful of Asian-Americans to make it. Sent to the Knicks D-League team in Erie, PA 3 weeks ago. Already cut by two other NBA teams before. It’s easy to lose heart in the face of defeat – but where will that get you?  Look where faith took Jeremy.

2. Seize the opportunity when it comes up. Lin got to start for the Knicks because they had to start him: too many injured and missing players. Lin made the most of it. Opportunities arise when we least expect them. Will you be ready to make the most of them? Be strong and confident to rise to the new  challenge? How can you cultivate the inner strengthen needed for that? It’s not easy to sustain confidence in the face of rejection.  

3. Your family will always be there for you, so be there for them. Lin only got his contract guaranteed by the Knicks a few days. His family has been his support: they pick him up when he gets down on himself and make him “continue to believe.” If you want your family to believe in you like that, you’ve got to be there for them when they need it.

4. Find the system that works for your style. Context is everything in leadership – no one is perfect in all situations. Lin isn’t Michael Jordan or Kobe Bryant (whom he out-scored the other night, by the way). His style of distributing the ball didn’t work with his other NBA teams. It’s perfect for the Knicks. Know your strengths and find the job or organization that’s a good fit. If you don’t, people will overlook what you bring to the table.  Amen!

5. Don’t overlook talent that exists around you. You may have a Jeremy Lin working for or around you now. Pundits say Jeremy wasn’t helped by others’ stereotypes: he’s from Palo Alto High and Harvard. He’s Asian-American. Don’t let assumptions blind you to your other or others’ talents. My own belief: we are all capable of much more than we now show with the right opportunity and support.

6. People will love you for being an original, not trying to be someone else. I love the Judy Garland quotation: Always be a first-rate version of yourself, instead of a second-rate version of somebody else.

7. Stay humble. In interviews, Lin shows humility despite the media frenzy. May we all have the grounding and executive presence!

8. When you make others look good, they will love you forever. The Knicks are playing well because they are playing better as a team – and have been working harder to share the ball since Lin. Lin praises his teammates to the media. Take note!

9. Never forget about the importance of luck or fate in life. To quote Eric Jackson, “Whatever you believe in, be grateful for it.”

10. Work your butt off. Lin was ready to seize his opportunity because his skills were strong from a lot of hard, hard work. Hard work is not glamorous – but there are no short cuts in today’s tough, competitive world.

I add a #11 to the list:

11. Choose hope. Hope is the most powerful form of human motivation. But it is not wishful thinking. Real hope is informed by persistence, hard work, patience, and courage – as seen in the Jeremy Lin story. The New York Times quoted one of Lin’s favorite verses: Suffering produces character, and character produces hope, and hope does not disappoint us (Romans 5:3-5). 

Sustain faith in yourself, passion for the contribution you want to make, and the hope necessary to find the right place to make it. Onward! 

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Leaders, Boost Your Creativity in 2012: Five Suggestions for the New Year

It’s resolution time. I’ve made my list and share five suggestions for yours to boost creativity in 2012.

Times are tough, and every industry is rethinking how it does business. Creativity and the capacity to think deeply and flexibly can pull an organization ahead of the crowd. How can you enhance your capacities and help your organization claim its competitive advantage?  Suggestions to boost your innovation brainpower:

1.  Read more fiction. There are plenty of benefits. Build new neuronal circuits. Deepen your knowledge of the human condition – and learn about yourself as your reflect on your responses. Improve your vocabulary, beef up those communication skills. Expand your cultural intelligence. Leadership is all about influence, communication, relationships, and seeing the simplicity on the other side of complexity. 

No time for major tomes? Try The Art of the Novella Series: short novels by some of literature’s greatest – Melville, James, Tolstoy, Chekhov, Twain, and more. The tiny classics tuck easily into a brief case, purse, or pocket – and their colorful contemporary covers are great conversation starters.

My first was a holiday gift – The Dialogue of the Dogs by Cervantes. Turns out the creator of Don Quixote also wrote the first talking-dog story. Ever wonder what your pet is really thinking, and what Fido can teach you about ethics and fairness?  I loved it: a quick read and deep ideas. I was hooked on the novella.

The Duel by Heinrich von Kleist (a 19th century German author I knew nothing about) was next. Read it, and let me know how your thinking about loyalty, everyday assumptions, and trust have changed.

I’m on The Lifted Veil by George Eliot now — her only work in the first person with eerie similarities to  Eliot’s claiming her public identity as a woman author. Next in line The Lemoine Affair by Proust — and a look at why humans are so easily conned!  Think shades of Bernie Madoff. 

2.  Discover the power and joy of quiet. We live in a world of 24/7 stimulation and news. We text, email, surf, and sit in front of screens (computer and TV) more and more (and Nicholas Carr in The Shallows: What the Internet Is Doing to Our Brains paints a dire portrait of the neurological, intellectual, and cultural consequences). Creativity requires quiet – the time and space to think. Find ways to build that into your day. Mindfulness is not a luxury for strong leadership.

3.  Break the work addiction. All work and no play makes for dull, burned-out people – and maybe even dead ones. The Chinese pictograph for “busy” is two characters: “heart” and “killing.” Loving your work isn’t the same as being a slave to it. You’ll work better and smarter when refreshed. Play is productive.

4. Think gray. It’s simple and counter-intuitive: train yourself to not make decisions quickly. You’ll fall into your regular thinking patterns easily: you need to push yourself to think slowly and carefully about what you’re not thinking about. That’s where you’ll navigate through the shades of gray to identify the best course of action. It’s hard to think gray: humans love binary, right-wrong, yes-no, black-white thinking. The concept comes from Steven Sample (the highly successful president emeritus of the University of Southern California) and is developed in his chapter in Business Leadership.

5. Embrace the novice role. Experience the world with new eyes. It’s good for mind and soul. A good way is to try something you’ve never done but have always wanted to or that you know you don’t do well. The process of learning slows life down, encourages mindfulness, and fine-tunes your skills as a reflective practitioner – a definite leadership plus. You might discover a new talent or passion in the process. 

Onward to a creative 2012 for us all! 

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The Soul of Principled Leadership: The Road to Success and Significance

I spent a day earlier this week reading and providing feedback to a colleague on a book manuscript dealing with leadership and spirituality issues. In the academic world, that’s what professors do for one another. It’s always a plus when we learn something important from the collegial support.

The book basically asks readers to think about the inner growth needed to drive principled, high-impact leadership. I’m not doing justice to the complexity of the work because it triggered a number of profound questions that have stayed with me all week.

What are the leadership contributions that I hope to make over the course of my lifetime – the things that I want to accomplish so as to have made a real difference by the time destiny comes calling? How do my hopes fit my true leadership gifts? What do I need to do to stay focused and balanced as I steer through these uncharted waters?

These are not simple questions, and we can never answer them fully. But grappling with the larger life issues implicit in them gives us the best shot at designing and managing a career that we can be proud of and that is both successful and significant.

We live at a time that predisposes us to gloss over the need for this kind of deep reflection. There is growing research on the long-term decline in happiness in increasingly affluent and democratic societies where people are misled by a materialist culture to put money and possessions at the center of our lives. They equate success with big paychecks and ignore the growing evidence that those who focus their lives on tangible goods grow demonstrably more miserable over time than those who set out to make other, deeper contributions – and profit from the success of their energizing efforts.

If you have ever felt the golden handcuffs of a well-paying job that drained a little bit of your soul everyday – made going to work as exciting as pushing heavy rocks uphill – you know exactly what I am talking about.

Striving to make a difference feeds the soul, and nothing is more energizing. Successful business leaders confirm that inner growth matters.[1]

So, what are the contributions you want to be remembered for? What are your gifts and talents – the things you do well and really enjoy? How can you fashion your life and work to stayed focused on all that?

Answer those questions, and you are well on the road to a career of success and significance.

[1] See Andre Delbecq, Nourishing the Soul of the Leader: Inner Growth Matters, in J. Gallos (2008). Business Leadership. San Francisco: Jossey-Bass.