Interview Jonas Ridderstrale Zurück
Jonas Ridderstrale 1. In Your book “Funky business – Talent makes capital dance”, also published in Hungary, you express the fact that only those companies can become successful that have the capability to lure the best talents into their team, because today the real experts or talents are the key winning factors rather than the expertise or high standards. What are the most significant features of such an organisation, company?

When people have been liberated, they will make choices and move around from organization to organization. This implies that you as a leader and your organization are players in a great global attraction game. You’ll have to court them. Courtship begins with trying to figure out what makes them tick. We differ. Different things make us mad, sad and glad. Human beings aren’t bulk goods. So, what you offer will have to differ. Personalize or perish.

Most companies have spent the last 20 years mass-customizing in relation to their consumers. During the upcoming 20 years clever companies will spend a lot and time and effort mass-customizing also the employee deal. Indeed, some have already done their homework. At the whacky and highly successful Brazilian company Semco, run by the maverick Ricardo Semler, there are more than 10 different ways to get paid – ranging from a fixed salary to stock options, royalties and bonus schemes, all of which can be combined in various ways. The company uses flextime. Employees evaluate their bosses. Semler has also established a profit-sharing system and insists that the financials are published internally, so that everyone can see how the firm is doing. At Semco, employee turnover is about 1 per cent.

Everything can be personalized – anything from office furniture to incentives. Most companies know that. Some organizations are indeed doing things about it. At IBM and Sun Microsystems between 40 and 50 per cent of the workforce already do their jobs remotely. But change is slow. Why do an absolute majority of all firms design compensation schemes only for those who live to work and not for the absolute majority of people who work to live? For many people, a couple of days at home with the kids when they have the flu can be worth a whole lot more than a nicer company car. Why do most corporations define excellence only for those at the top? Should a company where those who face the moment of truth on a daily basis have no standard against which to measure their greatness really expect to be that successful? Individualization is the key to effective people leadership.

Not everything should be personalized, however. Winning the great global attraction game isn’t only a question of full-blown flexibility. Firms also need to fix a number of things. If you try to be everything to everyone in the workforce, you’ll probably not mean that much to anyone. If you’re distinct in what you offer talent and tell them what you expect from them, your firm becomes self-selecting. Total flexibility means that everyone is a potential visitor, also those that you don’t want to hang around with. Standardization and personalization must co-exist.

People are tribal. Both talent and consumers will look for organizations that can provide them with meaning. If you’re looking for buy in think bio. An increasing number of competitive communities are biographical – made up of people who believe that they have something in common. The few things that are shared within the organizational tribe open up for diversity and variation.

2. Strategy-creation is one of the most important tools that contributes to the success of the organisation. How can we create an organisation that is able to renew and direct the future rather than follow up the events?

In my new book, Re-energizing the Corporation, which is due out early next year and that I’ve written with the former head of training and development at Sony Europe, I write about the built-in resistance to the unknown and uncertain that we find in most humans. Let’s face it. Few of us have that much in common with Bruce Willis’ John McClane character in the Die Hard movies. When exposed to surprise we go “Yikes” instead of “Yippie-ka-yeah”. We also know that the outcome of acts of experimentation are less certain and obvious than those focused on exploitation. The consequences of such innovation-oriented activities are also more remote in time. So, since most people prefer to play it safe, we continue to exploit – day after day, year after year.

Research suggests that over time organizations learn how to allocate resources between the two types of activities. This balancing act has short-term as well as long-term effects. The feedback loops from activities where we focus on exploitation tend to be quicker and more precise. In effect, learning processes improve the productivity of exploitation oriented work more rapidly than is the case when we try to be disruptive and create something new. This, in turn, impacts on how we allocate our limited resources. The long-term effect is that exploitation crowds out and finally kills creation.

Just like the historical Greeks and Digital Equipment, most of today’s organization will probably spend more and more of their resources exploiting the recipes of the past. If not re-energized, corporations and humans tend to become increasingly conservative and rigid in their behavior; more predictable and less likely to surprise the rest of us.

The challenge that we all face in a business-world where increasingly the winners take all – like Microsoft and Google – is that those who are just too late or just too little seldom happen to be around for that long. The innovators get everything while the imitating losers are standing small. A leader taking on the task of making change happen by re-energizing the organization must therefore develop behaviors -- their own and those of others -- that often fly in the face of human nature. You must empower yourself and others to choose curiosity over absolute certainty, the potential for having a good life over just staying alive, and the odd chance of thriving over merely surviving. You must choose what’s positive in the long run rather than just avoid the short-term negatives.

3. How could we strengthen the social and psychological capital of the organisation?

Boosting the psychological capital is about using techniques to build confidence, optimism, hope and resiliency. Methods include, positive feedback, setting clear goals for all, making sure that people experience success, contingency planning, delegation of authority, coaching and providing a safety net. Growing the social capital boils down to working on your corporate religion. This is all about creating a dream, story-telling, corporate celebration, valuing your values, having a positive employee expreience, managing space and re-aligning your structures.

4. In the book you mention that leaders should make themselves become better human managers? Could you please explain to us what you mean by this exactly?

During the 20th century, management was largely defined as the art of assuring organizational order. To achieve this objective, executives were supposed to destroy deviance – primarily negative deviance, but if a couple of positive deviants were killed in the process that was a sacrifice which most companies were willing to make in the name of professional management.

Management was focused on turning all things and most beings into standards and averages - identical parts that would be easily replaceable in a gigantic operating apparatus. How do you create sameness? Short answer; eliminate individual negative deviance. We turned our attention to the weaknesses of people and started to work on those. Our entire society, including most corporations, was obsessed with turning minuses into zeros – super-zeros, but still zeroes. The fixation on weaknesses came at the expense of us developing the capability to grow our strengths.

Almost from cradle to grave, we and our fellow citizens have been obsessed with curing illnesses rather than trying to practice preemptive medicine. Many managers still spend 80 per cent of their time and attention on the 20 per cent of the businesses, products or people that are the worst performers – the M&M’s of business - Mega-Minuses. What would happen if we did the reverse? This is what humanagement is about.

Today, we all know that peak performance must be based on our plusses – individual and corporate. If you’re born tone-death, not even 350 years of practice will turn you into the next Luciano Pavarotti. Positive surprise is produced not by super-zeros but by super-heroes – those who learn to grow their plusses and leverage their strengths. The new leadership paradigm for 21st century corporations must therefore be preemptive instead of curative. Each and every person on our planet is a container of the potential for positive deviance. My advice is simple; pursue your plusses.

5. At successful companies of the future, how should the attitude of leaders change? What kind of capabilities should a leader dispose? Could you share some examples with us?

In Re-energizing the corporation we write about one of the best leaders that I’ve come across. Let’s call him Harry. He was a board member of a European technology organization, having joined the business with a background in information technology and systems commissioning. He was not a typically out going person and Harry found it difficult to bang the corporate drum and rally the troops when leading teams. It was just not his style. Simply, his considerable reputation was built on getting things done.

The complex international matrix that Harry operated in meant that there were multiple stakeholders and lots of history to every change project that the organization started. Many change efforts taken on by the leadership team failed to materialize as baggage in the organization and strong country loyalties stifled progress. What was evident was Harry’s success. In stark contrast to many of his peers, he was able to deliver, time and time again. Recognizing the strength in his ability to organize, for people management and strategic thinking, the president made Harry the owner of the biggest and most complex restructuring, re-engineering and re-organizing effort that the European business had ever attempted in its extensive history.

Harry was not fazed at all, but did what he always did on large change projects. He assembled a team of experts he trusted, got clear sign off about the plan from every stakeholder no matter what the investment in time and travel needed to get it, and measured success and learning every day.

Harry’s experience had taught him that getting the right people mattered and he spent time finding them in the organization and personally talking to them about the need to work on this mammoth project. He had a knack of getting the right hot buttons for each person. So, he would tell some people that they were the only ones skilled enough to do the role. With others it was that they were the only ones with the guts to take the challenge on. He was the master of individualization when talking to his team.

Finding the right mix was chapter one in his book. Getting them to build a plan with him was always chapter two. He used his contacts to find a facilitator who could channel the energy of the team in a high-commitment, high-challenge team building and project planning process that created a bit of friction. Harry knew that managing talented people caused a bit of friction, but all work created friction, it’s a law of physics.

In this business Harry had a reputation for hard work, great planning and delivery. He also had a reputation for building talent and careers. Working with Harry got you noticed and most often, being part of successful delivery, promoted. He had no trouble getting a team to work for him.

Knowing the change project was a long haul commitment, as most significant re-engineering projects are, he ensured he had the right measures and feedback mechanisms. Harry set aside every Friday morning for a series of net meetings. He knew that managing a pan European team with outsourced partners in India would be hard on travel, so he used cyber meetings to measure, coach, report and update everyone. He spent four hours every Friday being available online to each of the 20 or so sub team projects.

The team worked hard to impress Harry and not let their other team members down. They understood the importance of what they were doing and how this would have an effect on the profitability of the business and the customer experience. They also knew that if they delivered, there was some reward and increased status for them. When credits and plaudits were called for, Harry ensured those that did the work gained the recognition for it, not him.

The re-engineering program was planned for 3 years, but was delivered in just over 25 months. The savings to the organization therefore increased above forecasts to over 250 million euros. Harry had once again proved that he was capable of leading change in a complex organization, regardless of the internal politics and history of failures. He was a master of engagement and delivery.

There’s an epilogue. The organization failed to retain Harry’s interest and, eventually, lost him. Harry thrived on big challenges and when he had delivered on most of them, found the company less satisfying. In an attempt to keep him, the organization gave him a flexible deal allowing him a 60 per cent contract with 40 per cent time to run his own business start up. This worked for a year but Harry needed his next big challenge and left to go to a smaller technology company, for a much reduced salary. Why? It operated in the green sector, providing technology solutions that were ecologically sound, safe and simple. The challenge turned him on.

6. How could we gain loyalty of talents? What kind of motivation tools can companies implement for successful business? Could you share some examples with us?

The level of loyalty that we find in a society tends to be reasonably constant, but it’s shifting. Decades and centuries ago, loyalty used to be imposed on us by kings and queens, czars and emperors, generals and dictators, popes or priests. Then it became self-imposed. Of course, peer-pressure, traditional norms and values emphasizing the role of work, collectivism and obedience still rule the lives of many people. For many, normality is still the norm and something to strive for. But for true talent, loyalty is self-directed.

Leadership by merely telling will not get you anywhere. Leadership by talking – discussing, debating, dialoguing, deliberating or conversing, chatting, consulting… call it whatever you want – is mandatory if you want to go for meritocracy rather than mediocracy. You have to earn trust by oozing of confidence. It’s really 360 degree confidence, we’re talking about. You must be confident in yourself and them. Likewise, they have to be confident in themselves and you. Trust is a give and take process.

7. The knowledge of experts requires continuous maintenance and development. How doe companies approach this issue? How can companies become brain-loading-stations? Could you give us some examples?

CEOs can be MOCs – Masters of Ceremonies. For more than 30 years, Nestlé’s Rive-Reine International Training Center has brought together managers from around the world to learn from senior Nestlé managers and from each other. At least once a month, the CEO goes there to teach and listen. This has created an international network of managers based on shared experiences and a common corporate religion. There is no magic trick. Just working hard and having fun. That, and focusing on the plusses that I mentioned earlier.

8. How can you anticipate the next steps in our life and business world that are liberalizing through the technological, institutional and moral value changes?

Far too few companies and executives spend a sufficient amount of time and energy thinking about how the fundamental forces of change might affect their businesses right now and even more so five or ten years down the road. They take the overall socio-economic context for given, or just put on blinders preventing them from seeing what’s really going on. Do you? Just think about some of the critical dimensions. In 2013:

Portfolio: What products and services will you live on?
Pipeline: How and when will these customer offerings be developed?
Positioning: You’ll sell them to the following customers?
Place: They’ll be delivered through the following channel(s)?
Passion: For the following reasons, you’ll give people goose-bumps?
Priorities: To be distinct you’ll say yes and no, respectively, to the following things at these points in time?

Unless you do something about it, exploitation crowds out creation and eventually kills it. An opportunity not acted upon has a nasty habit of eventually becoming a threat. And problems don’t age that well. Now, re-energizing your leadership isn’t about becoming the Oracle of Delphi or Merlin of your firm. My experience is that, quite often, just stating some basic facts about simple things that we already know a lot about, such as changing demographics outside and inside the firm, is enough to fuel an interesting and heated debate.

Why, in an unpredictable world, is all this talk about preparing for tomorrow important then? Well, great entrepreneurs – from Leonardo Da Vinci to Thomas Alva Edison and the coffee-evangelist Howard Schultz - have always been not only great artists, inventors and business-minds. Above all, they have proved to be some pretty awesome sociologists. These people simply posses and are obsessed with what Austrian economist Josef Schumpeter once labelled “combinative capabilities”. They excel at integrating knowledge from one field with ideas from another. I call this socio-economic arbitrage – foresight by insight.

Such arbitrage opportunities exist across levels, functions and space/time. Transfer recipes from the organizational world to the individual level – out-source your own work to two Indians. Bring in a conductor to teach business leaders about performance management. Have some Silicon Valley entrepreneurs energize a region in Croatia by exposing people to the future. By using your intellect to connect the dots already present on the firmament of human development, progress and evolution, you can anticipate tomorrow’s opportunities. Join the dots!
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