Wednesday, January 16, 2008

Strategic Planning Analogy #147: Sweat is Swell

Thomas Edison was a very successful and prolific inventor. In his lifetime, Edison obtained 1,093 United States patents, the most issued to any individual. These included the light bulb, the phonograph and motion pictures.

Edison attributed his success to long hours of hard work. In his words, genius was “1% inspiration and 99% perspiration.” Edison worked long hours in his laboratory, quite unaware of the time. He would say, "I owe my success to the fact that I never had a clock in my workroom."

Edison was known to work for 16 hours at a stretch, to the point where he gained a reputation for never sleeping. In actuality, he would take cat naps whenever he felt the need, no matter where he was at the moment or what was going on around him. Sometimes he could be found snoozing in the middle of the day stretched out on the ground under a bush, on his workbench or on his cot located in the back of his laboratory.

In order to preserve that great Menlo Park laboratory, Henry Ford had it moved to a site in Dearborn, Michigan (you can still visit the lab there). Henry Ford wanted to make sure it exactly replicated its original condition. Each brick was numbered, so that when the bricks were reassembled, they were in the exact same order. He even transported the trash heap next to the lab where the rejected ideas were thrown out.

On October 29, 1920, when the laboratory was reopened, Henry Ford asked Thomas Edison what he thought of the relocated lab. "It's ninety-nine and a half percent perfect," Edison replied. "What's wrong?" Ford asked, concerned. "Well," Edison replied, "we never used to keep the place so clean!" Edison was too busy working to worry about cleaning.

Lately, a lot of attention in the business press and business academics has centered around the importance of people in a firm’s success. Much is written about the need to acquire and retain the greatest talent in order to win. This is considered to be more important than ever, now that we are in a knowledge-based economy.

Thomas Edison was in the knowledge business over a century ago. He was very successful at it. It might be useful to see what his views were on talent. Yes, he had some bright and talented people around him. But the most important quality to Edison was their desire to work long and hard. He wanted people who would contribute that 99% perspiration to his inspiration.

Strategic success may indeed rest upon having the right people on board, but I’m not sure we always use the proper measurement of what the “right” person is. In many cases, “right” may have more to do with the quality of their sweat than of their intellect.

The principle here is that success has more to do with output than with input. You can have a room full of geniuses pontificate on all sorts of greatness and wonderfulness, but if they cannot bring any of it to market at a competitive price, then you are wasting your time. Or, to quote Edison, “Anything that won't sell, I don't want to invent. Its sale is proof of utility, and utility is success.” Output is what pays the bills.

Therefore, when contemplating your talent strategy, keep the following four points in mind.

1) Having the Most Intelligence Does Not Lead to the Most Success
Studies have shown that the most successful entrepreneurs tend to have gotten “B” grades in school. “A” students have been found to be less successful entrepreneurs. This is because A students tend to think things through further and can visualize more of the pitfalls to any idea. As a result, they tend to be more risk adverse and not pursue an unproven idea to conclusion.

Another study found that those with abnormally high levels of intelligence tend to be lazier than the average population. The problem stems from the fact that in the formative years of their lives, these intelligent ones were able to coast through life by relying on their wits. They never had to work hard to get by. It came too easy (no perspiration). Therefore, they never developed the discipline of hard work.

Another point to consider is longevity. The costs of employee turnover are very high when you consider the rehiring costs, training costs, and loss of knowledge. Often the brightest candidates have the most options, so they leave the soonest. I heard a college coach once say that he used to try to recruit the very best athletic talent out of high school. Then he realized that the very best would opt out for the pros in their sophomore or junior year. He found that he got a better return on investment if he pursued the second tier athlete, one who would stick around and be productive for four full years.

A recruiter in the business world I know used to say that he preferred hiring people out of second tier colleges in the Midwest. He claimed these students had fewer attitudinal problems, had a better work ethic, and would stick around longer.

Therefore, seeking the brightest is not necessarily the same as seeking the best. The best can often be a notch below the brightest. The brightest may be too risk adverse, too lazy, and not stick around very long.

2) Focus Talent Efforts Proportionately to Need
Several years back, I was unemployed and using an outplacement agency. They used to have a saying that went something like this: “About 5% of people are hired through the internet and about 75% are hired through networking. Therefore, in searching for your next job, you should spend about 5% of your time on the internet and about 75% of your time networking.”

A similar principle applies to your talent strategy. If success is 1% inspiration and 99% perspiration, then maybe most of your talent strategy should be concerned with getting enough perspiration. Yes, a firm needs some very bright people. But that doesn’t mean that everyone needs to be very bright.

In many prior blogs, I have talked about the need for focus. It is extremely difficult to be successful when a company is moving in hundreds of different directions at once. Success comes from narrowing the focus to only a few great initiatives at a time. Once you use the brilliance of the genius corps to set the agenda for focus, the priority shifts to getting the agenda accomplished. That takes a different type of individual…the perspiration expert. And guess what, you need more of the perspiration experts than the agenda setting geniuses.

3) “Followership” is Also Important
Business literature likes to talk about the importance of leadership. “Followership” is also important. Most organizations need a lot more followers than leaders. Shouldn’t we be concerned with getting the best followers at least as much as we are concerned with getting the best leaders?

One time, I was in charge of putting on an off-site meeting for business leaders. It was taking place in an old structure in the back-woods, with a slow-working heating system. These business leaders were used to leading. So at the beginning of the day, when the heating system hadn’t quite gotten up to temperature yet, these cold leaders would lead by turning up the thermostat all the way. Eventually, the slow working heating system would react and then the room would be way too hot. So then the leaders would turn the thermostat all the way down and the room would eventually be too cold again.

On multiple occasions, these leaders were told to leave the thermostat alone, and if they would just be patient, the room would get to the right temperature. But these leaders were not used to following, so all week long they would take the initiative to fiddle with the thermostat, making the room temperature alternate between too cold and too hot.

If these leaders could not even follow such a simple instruction, how well do you think they would follow on other issues where they might have to sacrifice some of the power in their silo for the good of the entire organization? Yes, even leaders need to be skilled in following.

4) Believers are Better than Mercenaries
In a previous blog, I talked about how employees who believe in the purpose and vision of the firm are more productive than people who only work for a paycheck (see “Soulless Capitalism”). Firms can often be like professional sports teams working under a salary cap. The sports team cannot afford to hire the best at each position and still fit under the salary cap.

Similarly, if you hire people who are only there for the money, you cannot afford your team. It is probably better to get a second tier person who passionately believes in what you are doing than some genius hot-shot whose incremental benefit will be eaten up in whatever additional perks you have to pay to keep them.

Assembling the right team is very important to strategic success. But the right team is not necessarily the smartest team. The right team has the proper balance of inspiration and perspiration, with a greater emphasis on perspiration—the ability to get the work done which leads to output.

Every so often in the music industry, people will try to put together a “supergroup” band made up of the best musicians available. These supergroup bands rarely last long. All of their egos get in the way and they cannot work well together as a band. Don’t make the same mistake with your business. Just because the individual pieces look good does not mean you will have successful output when they come together. Build a team that perspires well together.

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