Like in the case of any other economic theory there is no shortage of muddled up ideas about competitive advantage.
In this video, Ram Charan, co-author of the bestselling Execution and Confronting Reality, breaks some of the myths and misconceptions about competitive advantage. He also gives up a few tips on how businesses can remain competitive during crisis times.
Attracting and retaining skilled employees continues to be a massive challenge for companies. They’re trying to make the employee experience better by monitory incentives, provide better work life balance, increasing engagement and changing its work culture but still productivity in the United States is growing by only 1% every year. So what really is the cure?
The reality is that every employee understands that these employee well being programs, bonuses and incentives are only bandages placed on a very deep wound. The wound of debts and the fight for survival in a world that is getting increasingly unaffordable. The few dollars that are being invested for the employees are paltry in comparison to the fat salaries of the executives. Today the salary of a CEO is 320 times higher than their typical workers. And this gap is only widening further. Companies lure you by showing you that posh corner office but the truth is that there is lack of leadership grooming within companies and it’s more likely that external hiring may take over internal promotion.
In such a state of affairs a maverick CEO of Gravity Payments named Dan Price did something that was unprecedented. In 2016 he decided to keep a minimum salary 70000$/year for every employee. This meant doubling salaries of most employees. Experts called this a crazy socialist move which was destined for failure. But it’s now been five years and the companies still alive and thriving. They have now tripled their workforce and all the employees are still getting a base salary of 70000$.
This idea came to him while he was talking to one of his friend who was struggling to pay his bills despite earning $40,000 annually. Dan then decided that 70000$ is the amount to live a comfortable life in Seattle. This decision came with a cost. He had to cut his own salary by 1.1 million dollars, mortgage his two houses and break his stock and savings.
The reality is that every employee understands that these employee well being programs, bonuses and incentives are only bandages placed on a very deep wound. The wound of debts and the fight for survival in a world that is getting increasingly unaffordable.
The outcome of this was that he had more loyal and dedicated workforce whose lives got better. They could not only pay their bills but live but thrive. More and more employees are having babies (60 of them) and the number of employees buying homes has gone up tenfold. In an interview with CBS News, Dan says “Our turnover rate was cut in half, so when you have employees staying twice as long, their knowledge of how to help our customers skyrocketed over time and that’s really what paid for the raise more so than my pay cut.”
During the pandemic Gravity Payments lost 55% of its business the staff volunteered to take a temporary paycut to ensure continuity of business. And now when business as bounced back, the employees have not only returned to their normal salaries but are being given back the money they had given up. The employees aware of the sacrifices their boss made for them have now chipped in and bought a new Tesla car as a sign of gratitude. Dan exclaims “My employees have done way more for me than I could ever do for them.”
According to Deloitte the cost of losing one employee can range from tens of thousands of dollars to 1.5-2X their annual salary. It’s true that increasing the salary isn’t going to solve the employee loyalty issue but certainly if they made a true attempt to understand and empathize with staff members the dangerous job hopping trend can be reversed.
Sometimes the most honest answers come from spontaneity.
In this video, Teressa Roche, CHRO @ City Of Fort Collins gives us candid answers in a snappy question and answer session revolving around various work-related topics.
There’s a fine balance between being resilient and casting aside one’s pride and embracing failure. Failure may be terrible for individual entrepreneurs but perhaps beneficial for larger systems to have small failures and learn from it.
In this video, Thomas Eisenmann, author of the new book “Why Startups Fail” talks about his second point in his book which is called “cascading miracles”. He also diagnoses failure and the various mistakes and misfortunes linked to it.
Since our school years we’ve been trained to think of the Darwinian theory of “survival of the fittest”. We grow up in an individualistic society where every individual is supposed to take care of himself/herself. This lifestyle is further encouraged once we step into the workplace. We knowingly or unknowingly step on each other to climb the corporate ladder. However the recent trends suggest that perhaps we were wrong all this while and there is an urgent need for change. The cut throat business environments are now shifting their focus to a more humane workspace.
When we think of the Darwinian Theory, we think of nature. Nature is often the inspiration for so many theories and inventions. Maybe it’s time we look at nature again to get a hint of what our future workplaces could look like.
Peter Wohlleben, a German forester and author, writes in his book “The Hidden Life of Trees: What They Feel, How They Communicate” explains how a forest is like a family of trees, young and old, communicating, helping and living with one another in harmony. Here are a few lessons we can take away from trees.
our survival is not about the fittest but about the most well connected
Working together
Wohlleben points at two massive naked, winter stricken, beech trees standing next to each other. He says they’re old friends who do not encroach in each other’s space but “they are very considerate in sharing the sunlight, and their root systems are closely connected. In cases like this, when one dies, the other usually dies soon afterward, because they are dependent on each other.”
Protect each other
The main topic of conversation among trees appears to be about alarms and distress. In the dusty savannas of sub-Saharan Africa, when a giraffe begins to chew on the wide-crowned umbrella thorn acacia leaves, the tree sensing an injury lets out a distress signal in the form of a gas. The surrounding acacias detect the gas and start pumping tannins into their leaves. Tannin can sicken or even kill large mammals. The giraffe aware of this does not move on to the next tree.
Help the fallen
Wohlleben remembers an incident when once he noticed a felled tree about 400 to 500 years old. On closer inspection, when he scraped away the surface with his pen knife, he found the stump still green and alive. Trees refuse to give up on their dead and wounded. They continue to feed them in their fallen state for years together.
Mentoring/Nurturing
Suzanne Simard, a professor of forest ecology at the University of British Columbia in Vancouver, talks about the concept of a “mother trees”. Mother trees are not necessarily female but they’re the oldest and biggest trees in a forest. They play a protective and nurturing role for the younger trees around. Since they have the deepest roots, they have access to more water and nutrients to feed those that are struggling. Furthermore, they also protect lesser trees during windstorms, ice storms, lightning strikes, wildfires, floods, draughts, diseases and various other attacks.
Can we be more like trees? Can we use our stature, our experience to nurture others and not trample on them? Can we protect others from dangers, rather than being helpless observers to the suffering around? Can we feel deep down in our heart that in our roots we’re all connected, that our survival is not about the fittest but about the most well connected.
As more and more businesses are adopting AI for various uses, it’s important to constantly be grounded in the essential idea of what AI was meant for.
In this video, Ash Fontana, author of “AI-First Company” defines in a few words the concept of AI and how it is being used to solve and industrial and commercial problems today.
The role of PR is no longer just a branch of the marketing team. It has undergone tremendous changes in the past two decades with the advent of technology.
In this video, Sabrina Horn, author of “Make It, Don’t Fake It”, talks to us about the evolution of PR and what are some of the common pitfalls when it comes to a business’s understanding of PR.
Technology is not bad, it’s our inability to use technology well that is detrimental to our well-being. Recognizing this imminent problem upon us, mobile companies, including giants like Apple, Microsoft have come up with apps that will limit our phone usage. But one may wonder why would mobile companies who profit so much by keeping us hooked to our phones want to us use it less? Are they really good Samaritans or is there a hidden agenda?
The question we must ask ourselves is “have these companies ever been good Samaritans?” The short answer is “no”. In this cut throat competitive world, businesses, especially large businesses will never make a business decision that isn’t profitable.
If customers are accused or have been slowly nurtured to become a culture of “FOMO”, tech companies are also suffering from the same. With digital well-being taking the centre stage for a few years now and so many apps propping up to reduce or regulate our screen time, the big players don’t really have an option.
A closer scrutiny at some of the addictive industries (legal or illegal) in the world will show you the amount of legal and political battles they must endure to keep their businesses floating. Be it alcohol, drugs or cigarettes; there are heavy taxes levied on them, there are political campaigns rallied against the usage, there are social taboos that they must look to circumvent but is there any strong narrative against the mobile industry?
“If customers are accused or have been slowly nurtured to become a culture of “FOMO”, tech companies are also suffering from the same”
So what’s unfolding in front us is a brilliant business move. Tech companies understand well the psychology of an addict. An addict begins small, then his/her consumption grows over time till it one day he/she is destroyed and if fortunate to be still alive checks himself/herself into a rehab. Once fully recovered either does away with the habit completely or moderates it and in worst cases returns to the addiction and goes through the whole cycle again. Humanity has reached a point where they need to get into the rehab when it comes to digital consumption. The screen time limiting apps are nothing but mini rehabs that we go through every day. By introducing these digital well being apps they’re just prolonging your continuity in your addiction and not eliminating it. Elimination of addiction requires them to change the way they function, the way they track our every click and notify us. The moment you open your phone again, you will be flooded with the same amount of information, the same blast of notifications and the same dopamine surges again.
Let’s suppose that tech companies were our well wishers, our friends. Would a friend ever watch you get addicted and not try stopping well before the addiction takes an extreme toll?
Since we are in this tough situation we must make use of the technology and apps available to us to balance our digital life but perhaps it’s a bit of stretch to call the creators of this well crafted addiction as our well-wishers.
With the rise of machines, the world is poised for a massive change in the way work is being done. While there are apprehensions that AI will wipe out millions of job but there is also the hope that like every other technological development in the past, it will millions more.
In this video, Ash Fontana, author of “AI First Company” assuages the fear and paranoia about the job disruption that AI is bringing in and also talks about the necessary steps an organization needs to take in order to be aligned with new tech developments.
The modern workplace is heavily result oriented. You can be a good employee, meaning you are punctual, you work alright, you are engaged and friendly but you can still get fired if you don’t meet your targets. This applies even to higher management. So, if the higher management is under the sword and their bosses need to be answerable to someone then we see an entire corporate culture that is chasing after outcomes and goals. But who determines the targets, the goals? Higher management? Or the mid level management? Or the clients? Whoever determines the targets often is most often disconnected with the ground level employees. Often employees fall prey to the rather large ambitions of a company management.
The drawback of focusing on output is that it is limited to a fixed mindset. It focuses on only the productivity of an employee. How the employee has completed the task, what methods he has used, what skills are utilized are mostly overlooked. And what happens to under performers? Is firing them viable often in today’s work culture? What if the under performer has put in his/her all? What if he/she is just a great character to have in the team?
The crux of the matter is that a output oriented culture is bound to turn poisonous in the long run and ultimately fail. It creates a toxic culture of unhealthy competition, which makes every employee stand for himself/herself, it turns well intentioned individuals into selfish ones.
What if we shifted our assessment measures to evaluate effort rather than output? Not all employees have the same skill sets, the same calibre. A good performer may be actually underperforming based on his/her capacity.
The drawback of focusing on output is that it is limited to a fixed mindset
If we begin to evaluate workers based on their efforts we remove the competitive element. Once this is removed employees stop trying to outcompete one another. Maybe with time they will start using their time to help each other out and to appreciate the “effort” that everyone’s putting in.
This “effort” evaluation model can begin as early as the schooling days. Reward students who’re putting in their best rather than the marks they’ve acquired. That way they’ll put an effort throughout the year rather than a few weeks before the exams.
We can take this concept forward in our lives too. We need to observe and appreciate the people who’re putting in an effort for us rather than focussing on how they’ve materially benefitted us. A father with less resources might have the capability to fulfil all the random desires of child but he may still have put in hours of work to provide as much as he could given the situation.
A wise man once said “If the effort is there, the results take care of themselves”.
