Right notes. Wrong order.

It’s around this time of year that your elderly relatives start scanning the TV schedules to see if anyone’s re-running ‘that’ Morecambe and Wise Christmas special from 1971.

The fact the programme will be 51 years old this year only makes it more likely they’ll howl with laughter when it gets to the familiar punchline.

‘You’re playing all the wrong notes!’, cries renowned classical conductor André Previn, as Eric Morecambe’s shambolic pianist sabotages his orchestra’s performance of a Grieg concerto.

‘I’m playing all the right notes,’ Morecambe defends himself. ‘Just not necessarily in the right order.’

That’s how communication often feels inside a business. 

In theory, everyone is aiming in the same direction and talking about the same priorities. But, in reality, there’s often a massive amount of dissonance, as different parts of the business emphasise different messages – or articulate them in very different ways: with clip-art graphics, clunky language, ‘fun’ fonts and a homemade logo.

Clients sometimes look blankly at me when I point this out. They can’t understand why I’m taking it so seriously. I mean, it’s not like customers will ever see this stuff, right? Surely what matters is that people are getting on board with the messages? If the gist is right, where’s the harm if some of the execution is a bit amateur or inconsistent?

And the answer is that there’s no harm at all, if you don’t care that your Grieg concerto sounds like a music-hall comedy.

If the only thing that matters is that you’re playing the right notes. 

And not whether the resulting noise makes any sense to the audience.

It’s always about the manager

I spent Tuesday evening at the launch of WorkL’s new Employee Experience report.

WorkL is the business set up by Mark (now Lord) Price, who used to run Waitrose. It’s a data-based approach to helping organisations understand and improve their performance in the big areas that drive engagement.

What’s interesting about WorkL is that it uses an App to gather feedback from employees in over 27,000 organisations around the world, but it also provides specific insight and consultancy for individual businesses.  

The result is that you get a fascinating big picture view of employee experience trends across different industry sectors, countries and socio-demographic groups. And you also get practical, hands-on stuff you can do to improve your own performance.

If you’ve followed my blog for a while, you’ll know I’m a big fan of Lord Price. When he was at Waitrose, he pioneered a style of leadership based on culture, purpose and empowering individuals. 

Those themes are pretty standard in most businesses now but, 15 years ago, they were still groundbreaking in this country (outside HR departments) – and the success of Waitrose and John Lewis played a big part in bringing them into the mainstream.

After the presentation, I asked him what he thought was the most important factor in making employees happier and more productive at work. 

He said: 

‘Without a doubt, the relationship each individual employee has with their manager. The correlation is so strong that, if I only asked one question – do you have a good relationship with your manager? – I could tell you with confidence what their overall engagement score would be, based on that one answer alone.’

It’s a timely reminder that, whatever else we do to engage people and improve their experience of work, the thing that makes the biggest difference will always be the quality and humanity of their manager.

So choose your leaders well, at every level. Your business depends on it.

Make your own luck

Ingo Fiedler is a German academic who spent years studying the economics of poker. He discovered that, on average, the player with the strongest hand wins just 12% of the time: less than one game in eight.

In other words, success in poker is much less about what cards you have – and much more about how you play them.

That’s because poker, like life, is a game of partial information (which is why academics like using it as a model for complex decision-making). There are some things everybody knows, some things nobody knows and some things only each individual player knows and everyone else has to guess at. 

Even if you’re lucky with your cards, you can never be certain that one of your opponents hasn’t been luckier. So the best poker players never worry too much about what cards they’re holding. 

Instead, they rely on a mix of memory and maths to help them understand the statistical likelihood of different outcomes. And behavioural psychology to help them understand what their opponents are likely to think and do – and how they’ll react to different cues. ‘Play the man, not the cards’, as the legendary Amarillo Slim once put it.

Leaving aside the casual sexism (Slim played in a time before many of the world’s most successful poker players were women), that’s good advice for any business operating in today’s rather uncertain conditions.

Don’t worry about the stuff you can’t control: the market, the weather, global macroeconomic issues. Those are the cards everyone can see and you can’t do anything to change them.

Instead, focus your attention on what you can control. Watch your opponents carefully and use your experience and analysis to figure out your best way forward.

Is their customer offer or market position likely to be better than yours? If it is, can you dilute their advantage by launching earlier or promoting in a more eye-catching way? If it isn’t, can you anticipate how they might try to do the same to you?

The most successful poker players are the ones who think rationally, not emotionally.

Who are clear-eyed about the relative strength of their position – and adapt accordingly.

Who don’t let themselves get manipulated – or compound a loss because they’re too invested to walk away.

And who are constantly alive to everything around them, absorbing information and learning from their mistakes.

Because in poker, as in life, you get a lot luckier when you work at it.

What do you (really) stand for?

This week saw some interesting anniversaries.

200 years since Napoleon died.

200 years since the Guardian made its first appearance (as the Manchester Evening Guardian).

And 100 years since Coco Chanel launched the legendary Chanel No. 5 perfume.

What I find interesting about all three is how their reputations have changed over time.

Napoleon was a small man, but a towering historical presence. He was born Italian, but became an iconic symbol of French greatness. Modern-day Paris is still dominated by landmarks and railway stations bearing the names of his military triumphs.

Yet modern-day French politicians are often careful not to associate themselves too closely with Napoleon, because he was also an avowed racist, who reintroduced slavery to French possessions in the Caribbean and cynically betrayed the Haitian independence leaders who had helped him fight the British.

Not a great look for the leader of a Republic based on liberty, equality and fraternity.

Coco Chanel is another iconic French figure: an intuitive designer, spectacular self-publicist and subtly pioneering feminist, who dragged herself up from poverty to define the style of a generation.

She was also an unapologetic anti-semite and Nazi cheerleader, who spent her war years shacked up in the Ritz hotel with a German diplomat – and was only spared imprisonment because of the personal intervention of her friend Winston Churchill. 

My point is that reputation is never set in stone: glorious achievement in one field won’t prevent your reputation being tarnished by failings in another.

However, the good news is that it also works the other way.

The Guardian was first published by Lancashire mill-owners. In its early years, it was derided by the labour movement as a mouthpiece for capitalist exploitation. During the American Civil War, it loudly supported the Confederate states in their struggle to keep slavery.

Yet, over time – and under the careful stewardship of a new owner – the Guardian gradually established an editorial position more consistent with its lofty pronounced ideals.

During the Spanish civil war, it was the only mainstream British newspaper to oppose Franco. Just as it was the first British newspaper to ring alarm bells about the rise of Mussolini and Hitler, long before that become a fashionable position.

Now, I don’t say this because I’m a particular fan of the Guardian. The truth is, I rarely read it these days and, when I do, I often disagree with its editorial positions. 

But I’m glad it’s there. I think it plays an important role in keeping our leaders honest and promoting a fairer society – and I’m not alone in thinking this.

Opinion polls regularly show the Guardian to be the most trusted source of news, both online and among mainstream print media. 

It’s taken them 200 years to build that trust. Which is an example worth remembering next time you’re thinking about your organisation’s values.

You build trust by doing what you say you’re going to do and by living up to the things you say are important.

In other words, values aren’t optional. They’re not something you can disregard when it’s inconvenient or difficult (when you need to close a factory, say). 

If you do, you will lose trust – and all your other brilliant achievements won’t protect you.

So choose your values carefully.

Starlings vs. Lemmings

One of the most bizarre – and beguiling – things you’ll ever see in nature is a murmuration of starlings.

This is when hundreds (sometimes thousands) of starlings swarm together and, in almost perfect synchronisation, swoop and twist and expand, as if they were a single creature with a single mind.

That description doesn’t really do the phenomenon justice, of course. So, if you’ve never seen a starling murmuration, have a look at this:

Extraordinary, right?

What’s even more interesting is how and why they do it.

Ornithologists and animal behaviourists have studied starling murmurations for centuries. And the conclusion they’ve come to is that the birds are not taking their lead from a pace-setter at the front (as migrating geese do). 

They’re not following a choreographed plan.

Instead, they achieve their amazing synchronisation by focusing on the six or seven birds closest to them and reacting instantly whenever any one of them switches their flight pattern.

Why? Because they know they’re safer and more successful when they stick together. But they also know they’ve got a better chance of evading predators, or finding the best feeding spots, if they trust and respond to the instincts of the companions around them.

In other words, they become far more effective than the sum of their parts. 

Which is why a starling murmuration is such a good analogy for how an empowered organisation should work. Everybody moving in the same direction – but able to react quickly to threats and opportunities, because they trust the colleagues around them to make good decisions.

Unfortunately, it’s not the model that most organisations actually follow. Which is to have a shared plan and make sure everybody sticks to it.

That’s a good way of getting everyone moving in the same direction. But it won’t help you react flexibly to emerging threats and opportunities.

Instead, like gazelles on the Serengeti, your people will end up focusing all their energy on getting close to the inside of the herd, so they’ll be less likely to get picked off by predators.

Or like lemmings in the Arctic, they’ll focus rigidly on the plan. 

Even when it means they fall off a cliff.

Covid, cancer and creativity

This year marks the 50^th anniversary of the National Cancer Act, Richard Nixon’s attempt to immortalise himself as the President who beat cancer.

The plan was to copy the spirit of JFK’s ‘man on the moon’ vision and throw so many resources at the problem that, within five years, nobody in the USA would die from it any more.

Unfortunately, ‘beating cancer’ turned out to be a lot more complicated and nuanced than putting a man on the moon. Which is why, 50 years later, Nixon’s legacy is rather less glorious than he’d imagined and cancer is still the second biggest cause of death worldwide. 

That’s not to say things haven’t got better. Survival rates have improved significantly for every major type of cancer. 

Except one.

While overall cancer deaths have fallen, deaths from pancreatic cancer have actually risen. It’s now the second-biggest cause of all cancer mortality, killing half a million people worldwide every year, with a survival rate of just 5% in the UK (compared to 76% for breast cancer, or 53% for bowel cancer). 

How come? Why has this particular form of cancer resisted efforts to tame it?

There are a number of reasons. It’s hard to detect. It spreads more easily. It hasn’t had the profile of other cancers – and, therefore, not as much focus or research funding.

But the biggest problem, historically, has been not so much the scale of the resources available as the way they’ve been deployed.

All the big pharmaceutical companies have invested money and expertise in researching ways to treat pancreatic cancer. But most of that research hasn’t worked, which means they’ve hushed it up (‘don’t spook the shareholders’).

Which, in turn, means that, instead of pooling resources and learning from each other’s failures, they’ve wasted time and money duplicating them. 

In the meantime, 95% of people with pancreatic cancer are still dying from it – probably even more this year, since the lockdown has made it harder to detect the disease at an early stage.

And yet, oddly, the long term impact of the pandemic may actually be far more positive for cancer sufferers. Why? Because it’s changed the way people think.

Backed by massive government funding, pharmaceutical companies have combined with research institutes and health agencies to create not one, but five, viable vaccines to combat the covid-19 pandemic. 

Less than a year after the work started, the vaccine is already in the market and protecting people – one tenth of the time it would typically take. 

Working together on the covid vaccine has built relationships and trust between competing clinical bodies. More importantly, it’s built an instinct of collaboration, where people talk openly about research that didn’t work, because it helps everybody’s thinking move on faster.

The results are already seeping into cancer research, with a more collaborative approach yielding encouraging progress in treating pancreatic symptoms.

There are important lessons in this for any business.

The most important being that, if you really want people to be innovative, you have to create a culture where they’re not too scared to tell you something didn’t work.

Where they’re motivated to help each other, not keep things to themselves.

And where they can focus on the problem, without being distracted by money.

Changing the game

Short selling, as you probably know, is when an investor (let’s call them A) is so confident the value of a stock will continue falling that they bet on it. 

They make a deal to sell shares to B at an attractively low price, without actually owning the shares yet. Then they wait for the value to fall, so they can buy the shares at an even lower price, deliver them to B at the price agreed and bank the profits.

This is an arrangement that seems quite strange to people outside the financial markets (how can you sell something you don’t own?) But it’s legal and it has, historically, proved hugely profitable for Hedge Funds. 

The problem is what happens when that bet goes wrong: when the market doesn’t do what you expect and the share price goes up. A is still contractually obliged to give B the shares they’ve paid for, which means A has to acquire those shares at whatever price the market demands. So A makes a loss, not a profit.

That’s what happened last week to a number of Wall Street Hedge Funds, who had taken a short position on GameStop, a loss-making retailer.

Amateur market-watchers noticed so many funds were ‘shorting’ the stock that there weren’t enough actual shares to cover all the exposure. They smelt an opportunity, bought some shares and went on Reddit to urge fellow private investors to do the same.

The result was that, instead of falling, GameStop’s share price surged from $2.57 to nearly $500. It made no sense, but that didn’t matter. By the time the funds had worked out what was happening and bought enough shares to cover their obligations, they’d collectively lost around 19 billion dollars. They’d been beaten at their own game, by amateurs.

What’s interesting is that many of the amateur investors who piled in don’t seem to have been motivated by money. They know the shares they’ve bought are likely to drop in value just as quickly as they’ve risen. And they don’t care.

Because what they really wanted to do was give the Hedge Funds a bloody nose.

I suspect many observers feel some sympathy with that. After all, short-selling is a pretty unsavoury practice: Hedge Funds can buy and sell stock in such significant volumes that the simple act of offering the shares at a lower price often triggers precisely the fall in value they’re betting on. Which hardly seems fair. 

Especially when you consider that, for the Hedge Funds to win, someone else has to lose – which, in this case, includes the real people who work in GameStop’s stores and may lose their real jobs when the company’s value plummets.

That’s why I always think the most important question any business needs to ask (and keep asking) itself is this: what value do we create? What would the world lose if we weren’t here?

If the only answer is ‘money’, you’d better start looking over your shoulder.

Because the real people have figured out how to play your game. And they’re coming for you.

What’s your bottom line?

Two weeks ago, something quite interesting happened in corporate America.

B Corp, a group of around 30 CEOs from leading US and international corporations (including Ben & Jerry’s, Danone and Patagonia) took out a full page ad in the New York Times, urging their peers to commit to a more ethical way of doing business.

The ad was in the form of an open letter from the group to members of the influential Business Round Table, which is made up of 181 of the most prominent CEOs in America, including Amazon’s Jeff Bezos and Apple’s Tim Cook.

B Corp describes itself as ‘a fair trade label for companies – a global movement of people using business as a force for good’.

Their underlying idea is to shift from a culture that prioritises shareholder profits above everything else, to one where employees and the environment get equal billing: a ‘triple bottom line’.

B Corp argues that this encourages longer term thinking. Which, as well as making for fairer and more socially-useful businesses, ultimately delivers more sustainable long-term value to shareholders.

It’s hardly a new idea. In fact, just a week earlier, the Round Table had issued its own statement, re-defining the ‘purpose of a corporation’ to give equal weight to social and environmental interests. In other words, the same triple bottom line.

Jamie Dimon, the CEO of JP Morgan and the Round Table’s Chairman, said he hoped the statement would ‘help to set a new standard for corporate leadership.’

So why did B Corp feel the need to press for a firmer commitment?

Perhaps because the Round Table hasn’t always been consistent in its thinking.

Through the 1980s and early 1990s, when the US economy was booming, they promoted a similarly inclusive definition of a corporation’s purpose.

But, in 1997, when the global economy started to look a little more challenging, they rowed back on this progressive thinking and defined corporate purpose in much narrower, shareholder-first terms – and that’s where they’ve stayed ever since, until last month’s statement.

Which is why the B Corp open letter is so interesting.

They’re essentially challenging America’s biggest businesses to put their money where their mouth is.

Don’t just talk about a better model of business, they’re saying.

Commit to it.

Sign up.

Become a B Corp member.

It’s an interesting challenge because, if you do sign up, you’re changing the way decisions are made in your business.

For instance, using tricky loopholes to get round inconvenient tax rules (good for shareholder returns) would no longer be something you could justify (bad for the wider community).

And what happens when the global economy goes through another downturn – as economic indicators seem to suggest may happen soon?

Will your shareholders accept lower profits and smaller dividends, while you reinvest to protect your workforce and make your business more sustainable in the long term?

Or will they fire you?

As Bill Bernbach used to say, a principle isn’t a principle until it costs you money.

Let’s see if the Business Round Table are really willing to live up to the bold words in their statement.

Matt is the author of tribe: 66 ideas for building a winning culture, which explores the characteristics that contribute to a winning workplace culture. He’s also written inside: the 10 communication secrets that will transform your business.

If you’d like a free copy of either book, pop in to The Forge (we might even make you a coffee…)

 

 

The right stuff

If you visit The Smithsonian Institution in Washington, one of the exhibits you’ll find in the space exploration section is a stopwatch.

At first glance, it seems fairly unremarkable.

Until you discover it’s the watch used by NASA flight technician Bob Carlton, to keep track of how much time was left before the fuel on the Apollo 11 moon landing craft would run out.

The clock is stopped with 18 seconds remaining.

In other words, after over two hours spent trying to find a safe place to set the landing craft down, Neil Armstrong and Buzz Aldrin had just 18 seconds left before they would have to abort the mission and return to earth.

Man might never have set foot on the moon.  The world we grew up in might have felt a very different place.

So those 18 seconds are incredibly significant.

The position of the hands on the stopwatch is a permanent reminder of the moment when mankind became a species that could define its future in terms of more than one planet.

And, recognising the significance of the moment, Bob Carlton was determined to preserve it.

He put the watch in a box, took it home and locked it in his desk drawer.

A week later, he took it out and was perplexed to see that the hands were stopped at 22 seconds. Had he called the wrong time – made a mistake under pressure? Alarmed, he put the watch back and resolved not to mention it to anyone.

The following week, he looked again. This time, the hands were on 31 seconds. What was going on? Was the mechanism faulty? Had there been a risk to the mission? Did he need to report it?

The real explanation was more prosaic. Carlton’s teenage daughter was a drum majorette – she had found the watch in her dad’s desk and, not realising its significance, had used it to time her baton-twirling routines.

So the hands on the stopwatch you see in the Smithsonian are not stuck in the precise position they were in at the historic moment of touchdown.

They’re in the closest approximation Bob Carlton could get them into, before handing the watch over to the Museum 50 years ago.

Does that matter? Does knowing it reduce the significance of the watch – or its authenticity as a historical record?

Not really.

The point is not the watch. The point is the story – and what it tells us about the guts, determination and ingenuity of people who were prepared to fly hundreds of thousands of miles in a metal can to set foot on a totally alien environment.

You could melt the watch down and replace it with a fake one made out of cheese and it wouldn’t make any difference.

Because it’s not the symbol that matters. It’s the story behind it.

That’s something worth keeping in mind next time your business sets out on a mission to ‘rebrand’ itself.

People will agonise for weeks (or sometimes years) about the best colour ways, the ‘right’ font, the optimum balance between the logotype and the end-line.

And none of those things will make the slightest difference, if the business doesn’t also stand for something meaningful to the people who work there and the customers it serves.

Real brand is never about ‘branding’. It’s about having the right stuff.

Photo – The Smithsonian Institution – Museum of Space and Aeronautics

How to sabotage your own reputation

When you buy a ticket for an airline flight, what do you think you’re buying?

The ability to travel from A to B at the date and time on your ticket?

Not according to British Airways.

(Regular readers of this blog may sigh to hear me bring up that name again – but bear with me. I promise there’s a point…)

When I complained to BA recently about bumping me off a flight back from Texas, they handled it every bit as badly as the original incident (which is to say, they ignored it completely, until I sent a second stroppy letter to their CEO – at which point, they offered a grudging apology and a few quid off another flight).

The most interesting part was that they denied liability for any losses caused by the delay, because they said they weren’t contractually obliged to carry me on the flight they’d sold me the ticket for.

This didn’t seem to make sense, so I checked twice, to make sure I hadn’t misunderstood. I hadn’t. They said: ‘BA reserves the right not to let you on the flight if we’ve oversold it.’

In other words, when you buy a ticket from BA, what you’re actually buying is the ability to travel from A to B at a time that suits the airline, even if it totally disrupts your own plans.

Or, to put it another way, if you’re counting on BA to get you to a meeting, or a concert, or a family wedding on time, you’d better hope you’re one of the lucky ones that doesn’t get bumped off when they sell more tickets than they have seats on the plane.

You might think this is a rather odd policy for an airline that claims to pride itself on customer experience.

Until you remember it’s the same airline that, this week, got hit with a £183m fine for letting hackers access its customers’ confidential data.

‘This fine isn’t fair’, whined BA’s management. ‘We’re all about customers – we’ve just spent loads on some new bag drops at Heathrow. How can we be the bad guys here?’

And that’s the point. BA just don’t get it.

You can have the best bag-drops in the world. The fanciest menus. The softest cushions.

And none of that matters if you can’t get the basic elements of customer experience right. Such as taking people where they want to go when you said you would. And not exposing their personal and financial data to criminals.

If your customers can’t trust you, nothing else matters – and, if BA really cared about their customers’ experience, they’d know that.

But they don’t. And that’s why they’re now £183m worse off.