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The Evolution of Capitalism: Profit or Purpose?

HR Magazine, 26 January 2022

The Evolution of Capitalism

Profit or Purpose?

Adam Kingl

Is profit the fundamental criterion for a business?  As capitalism is evolving under our feet, and that evolution is accelerating since Covid, we’re seeing a shift of emphasis from the pre-eminence of shareholders to stakeholders: customers, employees and communities.  Now, I want to make a very important distinction.  This does not mean that shareholders are getting the short end of the stick in terms of reward.  If companies refocus or even redefine how they add value to stakeholders, then shareholders are rewarded too.  

At a macrolevel, this shift that we are just starting to observe is essentially a rebalance in corporate focus from outcomes to outputs.  If we think of outcomes as share price and profit, we cannot deny that these are good things to have.  But I can’t storm into the office and say that my focus today will be to maximise my share price. What am I supposed to DO??  A blinkered focus on share price creates drift away from the reasons a company was founded in the first place: to identify a market need and to serve customers brilliantly.  Creating value for customers and serving them better are outputs that companies can rally behind, can guide whether to spend more time on activity A or activity B.  My outputs will lead to the outcome of enhancing my bottom line.  But the outcome is not my daily focus – this is a subtle but hugely important point.  

Does this mean that the CEO would not want to earn a profit?  Absolutely not. Business has to survive and thrive.  Here’s the rub.  Most businesses were founded on an idea of introducing an exciting product to the world, serving a previously undiscovered market need, bettering a community or creating employment opportunities.  But then financial analysts’ opinions grew in importance to investors, with their use of various ratios that are useful shortcuts in assessing company health.  However, we must remember that these shortcuts are only performance indicators for today; they do not assess if the business is closer to or farther from achieving its purpose, closer to or farther from achieving long-term or ‘moon shot’ objectives.

Chasing ratio optimization is a short-term game.  Before one knows it, the purpose of the business is about tacitly, implicitly pleasing analysts.  Making decisions toward long-term objectives takes a back seat, and sustained success can become much harder to achieve over time. Unfortunately, that’s exactly what happened on a massive scale.  At an inflection point in the second half of the twentieth century, as analysts’ and shareholders’ voices became louder, the CFOs’ and Investor Relations’ departments began to dominate the c-suite conversations. CEOs’ compensations grew increasingly related to share price and less on customer value indicators.  The focus on outputs dropped down the totem pole in terms of time and attention in favour of outcomes.  One could argue that the Great Recession of 2007-09 was caused, or at least made much worse, by this shift in focus.   

Companies that remain focused on their purpose are rewarded by investors and customers.  Aggregate research has proven that such purpose-focused firms significantly outperform their rivals.  The authors of the book, Firms of Endearment, explored those organisations who are in the top ten percent in relation to focusing on their purpose, community, customers and employees.  Their research revealed that, over the decade ending in June 2006, these firms returned 1,025% to their shareholders, compared to 122% return on investment by the S&P 500 overall.  Just to be clear, this study therefore quantified that purpose-driven organisations reward their investors better than the market average by a multiple of ten!  

Separate research published in Organization Science reached a similar conclusion.  Faculty from Harvard, Pennsylvania and Columbia Universities surveyed half a million employees across 429 firms.  While these academics did not find correlation between purpose alone and financial performance, they proved that companies with strong purpose and high clarity from management exhibit stronger financial and stock market performance.  The implication is that one condition of commercial success is that an organisation’s employees understand and believe in their collective purpose and have a clear path as to how that purpose will be achieved.  

Perhaps our ultimate question is: Are purpose and profit a zero-sum game?  Recent research indicates this is not necessarily so, and the two forces may even serve each other.  A huge amount of dialogue has attempted to answer this question both in media and in conferences.  The opinions are typically more definitive than one may guess and often resemble the sentiment: ‘The most successful companies, both in profitability and longevity, are the ones who recognise the absolute necessity of profits as well as the equally high necessity of having a purpose beyond shareholders’ wealth.’

Adam Kingl (adamkingl.com) is the author of Next Generation Leadership and is an Adjunct Lecturer at the UCL School of Management, where this theme of the evolution of capitalism is explored in the School’s executive education practice and notably in its Building Competitive Advantage through Sustainability course: https://www.mgmt.ucl.ac.uk/executive-education. 

https://www.hrmagazine.co.uk/content/comment/the-evolution-of-capitalism-profit-or-purpose

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Managing Diverse Collaboration in a Virtual Environment When Leading Innovation

Managing Diverse Collaboration in a Virtual Environment When Leading Innovation

Adam Kingl

A plethora of collaboration dysfunctions can easily derail innovation conversations.  I began conducting a number of experiments ten years ago to explore virtual and face to face dynamics, and which may be optimal, when holding conversations requiring creative inputs from a team.  These experiments demonstrated that team leaders should consider continuing to hold at least some of their innovation discussions on virtual platforms, even if the pandemic would technically allow the team to meet in person.  There are two important reasons for this recommendation.  

First, charisma or extraversion, a traditional leadership trait, is often disintermediated in a virtual environment.  The extrovert jumps in with their contribution first and often, while the introvert is still processing options and responses.  But on an asynchronous, virtual discussion platform like a discussion board, team members cannot rely on force of personality to push solutions, but on the clarity and quality of their ideas.  Introverts, and those who are less confident working in a second language, may actually thrive more in a virtual team.

Second, merit has more power than familiarity or hierarchy in virtual teams.  We have all experienced how factors such as cultural norms, gender, career levels and reporting lines contribute to only a few voices, sometimes only one voice, dominating in a room.  Most of our organisations’ architectures are predicated on a pyramidal hierarchy, which for centuries has suggested a tacit dogma of the manager’s infallibility.  This canon has ruined many millions of meetings, where idea creation gives way to waiting for the leader to contribute, and then the rest of the team either agreeing or remaining silent.  

In a virtual, asynchronous environment, team members scan reflect before answering, the less confident can reply thoughtfully and bravely.  Adding anonymity to contributions reduces the senior voices from owning the lion’s share of the conversation.  The best ideas rise to the top instead of those which happen to be from the most senior.  Therefore, if an important objective of any leader is to bring out the best in everyone, then he or she should consider utilising a virtual forum for at least some discussions and particularly if managing a very diverse team.  

Two important points to remember when considering virtual teamwork:

First, technology does not solve every problem.  Virtual teamwork can fail if leaders do not attend to the fundamental problems of coordinating, engaging, and motivating individuals, particularly across time zones.  It’s easy for team members to disengage when they’re not face-to-face, so the leader must convey a high degree of enthusiasm and clarity and agree on who is accountable for what from the start. 

Second, it is dangerous to assume everyone has the same understanding of how the virtual team with work together.  For example, will everyone be in one virtual ‘place’ at the same time, or will they contribute on their own time?  To lead a virtual team, the leader must focus more on team maintenance (‘How are we going to work together?’) before task maintenance (‘’What is the creative solution to the problem or opportunity?’).  

When to Leverage the Expert or the Crowd

I am mindful that the expert in the team must still be given his or her due in creative conversations, particularly when understanding technical issues or opportunities would be key.  I would argue that the smaller the team, the more this lesson is true.  On the other hand, a possibly negative team dynamic that could occur is that the expert is used to being right and may win a debate just through the power of his or her own confidence and of having more data to hand.  With larger teams, I recommend a balance between considering the expert view and leveraging the collective wisdom inherent in diversity and large groups.  The following table is a short-hand guide suggesting when to utilise the expert and when the ‘crowd’ in a given team.

Size of Team

Use of Experts

Use of Diverse Group

Small (seven or fewer people)

Experts are more likely to provide some of the best answers

May not have powerful diversity in a small number so the ‘crowd’ is less likely to provide the best answers

Medium (eight to twenty people)

Solicit the experts’ opinions separately from the group to avoid rushing to an answer

Discuss with the team before bringing the experts back into the dialogue

Large (twenty-one plus people)

Solicit the experts’ opinions; test the team’s collective view of those opinions 

Survey the team’s views and look for trends and averages

Organisation-wide

Gather a group of experts with diverse views to test the emerging views of the wider organisation for rigour and/or to ask follow-up questions

Consider using an internal company platform or social media to collect large samples, votes and discussion boards to test ideas

Another solution may be to consider the views of the crowd and the expert separately, so that one view does not influence or anchor the other, and then share for discussion.  A final recommendation is to find ways in which the emerging collective view is not a victim of groupthink.  

A diverse group’s mosaic of different views can balance the important but perhaps narrower view of the expert. The challenge for the manager of such a team or organisation is to find incentives and create cultural norms that make the soliciting of views a regular occurrence, while identifying patterns, averages and trends in those views, and then encouraging rigorous debate.  Instead of following the cliché of ‘agreeing to disagree,’ perhaps embracing multiple and diverse points of view could lead to the stronger though less intuitive paradigm of ‘disagreement to convergence.’  

Adam Kingl (www.adamkingl.com) is an Associate of the Moller Institute, Churchill College, University of Cambridge.  He is the author of the book Next Generation Leadership and an educator and adviser.  Formerly, Adam was the Regional Managing Director, Europe, of Duke Corporate Education and the Executive Director of Thought Leadership at London Business School.  

https://indd.adobe.com/view/bb16cf03-6c8a-4d66-8ae3-90c406118980

Inspire Magazine, The Møller Institute at Churchill College, University of Cambridge, Issue 4, Leadership Mindsets, pp.32-33

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Inspire Magazine: Next Generation Leadership Book Launch

Inspire Magazine, The Møller Institute: Issue 4, Leadership Mindsets, p. 16

Book Launches

Next Generation Leadership: How To Ensure Young Talent Will Thrive With Your Organisation

  • Adam Kingl

We are on the verge of a seismic shift in a world of work.  Why are we toil, the employer-employee social contract, leadership, retirement and the nature of business itself are changing before our eyes in ways as least as significant as what humanity and served in the early days of the industrial revolution. And it all starts with understanding Generation Y.

Generation Ys (or Millennials), are youngest workers have been slandered for a decade. You’ve heard the accusations before: Gen Ys are indolent, spoiled, coddled, uninterested in climbing the corporate ladder, ever texting, indifferent about what it takes to succeed. Those who aren’t quite so critical merely laugh off these generalisations saying, ‘Oh we were like them when we were young too.’

In reality, to be so dismissive us to ignore macro-trends that have forever altered fundamental models of work and employment.

These trends include insecure retirement, the failures of shareholder capitalism and longer lifespans. What we observe in Generation Y is merely the first, widely shared rejection of their inheritance—the world as we know it.

This rejection manifested itself in what confounds, annoys and terrifies human resources department the world over: scarce loyalty to one’s employer, a trivialising of financial benefits, a hue and cry for work-life balance, a craving for constant development, and an insistence on a powerful, shared, authentic corporate purpose. Kingl’s research in his new book Next Generation Leadership explores what’s behind these shifts in the character of the emerging workforce and the implications for how we might need to manage and lead differently today. How might we recruit, retain and develop top talent?

Most importantly, if Gen Y indeed requires a different style of leadership, then as Gen Y assumes managerial positions themselves, then the nature of leadership and of business itself will also change over the next few decades in irrevocable and profound ways.

“Nuggets of gold which challenge the way we should lead our multi generational teams / organisations.”

https://indd.adobe.com/view/bb16cf03-6c8a-4d66-8ae3-90c406118980

UCLSOM

The Cost of the Global Resignation Crisis

UCL School of Management

20 JANUARY 2022

THE COST OF THE GLOBAL RESIGNATION CRISIS

Notebook with the title "the great resignation' clipped to an arrow pointing left.

Recent studies indicate that almost 55% of the global workforce are considering resigning from their current role. Adam Kingl has been discussing the innovation and finance implications of the current resigning crisis. 

Adam’s research indicated that the “great resignation” phenomenon was already growing before the pandemic when he found that 90% of millennials (who compose about 60% of the global workforce) do not plan to stay with their employers for more than five years, and over a third plan to leave within two years.

Replacing an employee can be costly for organisations, averaging around half to two times their annual salary. Adam explains the implications can be more severe for professional services firms, such as law firms and consultancies where a partnership model is most common, but that it has drastic implications for all organisations.

He advises that to keep employees engaged and reduce the high levels of resignations employers must focus on; development, organisational culture and purpose. He says organisations must “reconsider the models in our organisations and think about how we can still imbue people with purpose and values so that they will stay a little bit longer, but also create those organisational designs that are not necessarily ‘up or out’.”

Read the full article

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Putting a price tag on the Great Resignation

While we’ve been talking about the global resignation crisis anecdotally, we now have figures that reveal the scale of the emergency.

A Microsoft study indicated that 41% of the global workforce are considering resigning within one year, and a Fast Company article suggested that this number may actually be as high as 55%. As many as one in four employees may be considering leaving their roles within six to 12 months.

My own research indicated that this phenomenon was already growing before the pandemic when l learned 90% of millennials (who compose about 60% of the global workforce) do not plan to stay with their employers for more than five years, and over a third plan to leave within two years.

To put a price tag on the problem, if the average cost of replacing an employee is between one half to two times their annual salary, then a 100-person company with an average salary of £60,000 could be facing replacement costs in 2022 of between £750,000 and £3,000,000.

The implications of the resignation crisis are especially dire for professional services firms. I’m thinking of management consultancies, accounting and law firms that have a partnership model in particular.

Initially, this model only worked if graduates knew they were on an 10-year journey to make partner, but what if those graduates don’t care about becoming partners anymore? Then the social architecture of the venerable ‘firm’ would crumble.

But in just about any type of organisation, the life-long corporate citizen is going the way of the dodo. As a result, a number of long-held assumptions around how to retain talent are being overthrown.

Since pensions aren’t what they used to be, with the inevitable transition from final salary to defined contribution schemes, and average salaries have not grown concomitantly with inflation over the last 30 years, salaries and pensions are just not serving as the ‘golden handcuffs’ of yesteryear.

Instead, my research indicates that the top factors at employee engagement today are development, culture and purpose:

  • Development can no longer be a reward for tenure since top talent won’t wait for up to 10 years for that management development programme. Upskilling and continuous, rather than intermittent, development is the new norm.
  • Organisational culture has to be visible in shared behaviours and actions, not values and platitudes in the annual shareholder reports and on colourful posters in the lifts.
  • Purpose must be lived and companies must be curious about each colleague’s own choices in their professional lives and why they choose to work here.

I frequently talk to firms who are seriously questioning their philosophy of work and the architecture of how they are composed.

We have to reconsider the models in our organisations and think about how we can still imbue people with purpose and values so that they will stay a little bit longer, but also create those organisational designs that are not necessarily ‘up or out’.

That aspiration must involve working on purpose and legacy, particularly with senior executives, those in the last trimester of their careers, who might otherwise be thinking, ‘Well, there’s very little else that you can teach me’.

I would want to get this stakeholder group together and ask them to think about the type of firm that they wish to leave for their successors. How might it be possible to have more fluid movement in and out of the organisation?

In that way, top talent might include those who are en route to becoming enterprise leaders, or might become future clients, or might become suppliers or partners, or might ultimately want to work on a contractor basis. After all, over 60% of the world’s work is now organised according to projects.

Top young talent might even want to return as senior executives later in your company’s life. In other words, they might join a firm two or three times during their careers, coming in and out of the organisation with greater dexterity than most companies would currently tolerate.

It really involves rethinking how you work and how you are structured, but those difficult conversations have to begin now.

Adam Kingl is the author of Next Generation Leadership and an adjunct lecturer at the UCL School of Management

HR Magazine, Published: 19 Jan 2022

https://www.hrmagazine.co.uk/content/comment/putting-a-price-tag-on-the-great-resignation

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The Great Resignation and What We Can Do About It

The press has recently been discussing what appears to be a resignation crisis that we’re facing globally. After all, there are four million people who quit their jobs in April 2021 in the U.S., a twenty-year high. There were a record ten million job vacancies in June. A Microsoft study indicated that 41 percent of the global workforce are considering resigning within one year, and a Fast Company article suggested that number may be as high as 55 percent.

The implications of the resignation crisis are especially dire for professional services firms. I’m thinking of management consultancies, accounting, and law firms that have a partnership model in particular. Initially, the partnership model only worked if graduates knew they were on an eight to twelve-year journey to make partner, but what if those graduates don’t care about making partner anymore? The social architecture of the venerable ‘firm’ is crumbling.

But in just about any type of organization, the life-long corporate citizen is going the way of the dodo. Research from my book, Next Generation Leadership, has shown that Generation Y (or the Millennial generation) is considering leaving any given employer on average every two to five years. As a result, a number of long-held assumptions around how to retain talent are being overthrown. Since pensions aren’t what they used to be, with the inevitable transition from final salary to defined contribution schemes, and average salaries not growing concomitantly with inflation over the last thirty years, salaries and pensions are just not serving as the ‘golden handcuffs’ of yesteryear. Instead, my research indicates that the top factors at employee engagement today are development, culture, and purpose:

  • Development can no longer be a reward for tenure since top talent won’t wait for five to ten years for that management development program. Upskilling and continuous, rather than intermittent, development is the new norm.
  • Organizational culture has to be visible in shared behaviors and actions, not values and platitudes in the annual shareholder reports and on colorful posters in the lifts.
  • Purpose must be lived and companies must be curious about each colleague’s own choices in their professional lives and why they choose to work here.

I frequently talk to firms who are seriously questioning their philosophy of work and the architecture of how they are composed. We have to reconsider the models in our organizations and think about how we can still imbue people with purpose and values so that they will stay a little bit longer, but also create those organizational designs that are not necessarily ‘up or out’. That aspiration must involve working on purpose and legacy, particularly with senior executives, those in the last trimester of their careers, who might otherwise be thinking, ‘Well, there’s very little else that you can teach me.’

I would want to get this stakeholder group together ask them to think about the type of firm that they wish to leave for their successors. How might it be possible to have more fluid movement in and out of the organization? In that way, top talent might include those who are en route to becoming enterprise leaders, or might become future clients, or might become suppliers or partners, or might ultimately want to work on a contractor basis. After all, over sixty percent of the world’s work is now organized according to projects.

Top young talent might even want to return as senior executives later in your company’s life. In other words, they might join two or three times during the course of their careers, coming in and out of your organization with greater dexterity than most companies would currently tolerate. It really involves rethinking how you work and how you are structured, but those difficult conversations have to begin now.

Adam Kingl is an Adjunct Professor at Hult International Business School, www.adamkingl.com

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Transitioning from hierarchical to a network-based organisational structure: 4 key points for leaders

Networks are powerful systems. While the networked-based structure seems to be the way forward to many teams, leaders need to be aware of issues related to the flow of decision making, talent retention and purpose.

by

 Jun 23, 2021

The covid-19 pandemic and subsequent acceleration of digital transformation have forced organisations to innovate rapidly, change their products and services, and remain flexible to adapt to an ever-changing landscape. These significant changes have prompted a resurgence of the debate about the optimal organisational structure.

Over the past few years, there has been a welcome shift toward client-centricity with organisations adopting more agile structures – centred on products, teams, and projects – and forming both internal and external networks of teams that are generally empowered to communicate, coordinate, and make decisions.

Yet, given the volatility of our times and challenges related to digital communications and employee wellbeing, there are certain limitations to the model. A recent study, for example, found that “network centric organisation does not necessarily lead to higher perceived situation awareness or better understanding of the situation”.

We asked three experts from our global educator network to share their advice on the key points to be aware of when adopting a new organisational structure. Their answers reveal that while the networked-based structure seems to be the way forward to many teams, leaders need to be aware of issues related to the flow of decision making, talent retention and purpose.

1. The rise of ‘extreme teaming’

The move towards network-based structures is a recent evolution, according to author and thought leader Peter Fisk.  “A decade ago, around 80 percent of employees had functional roles, the rest seconded to ad-hoc projects. Today, that ratio is reversed. Few employees now have fixed roles. Formal job titles in outdated organisational charts have given way to a more fluid deployment of talent, by project, to manage constant change”, says Fisk.

In a recent article, Fisk states: “Networks, whether organisational or social, are powerful systems. “Every additional participant creates new connections, capable of driving the exponential growth of today’s network-based start-ups.”

At the heart of these network structures is the concept of “extreme teaming”, Fisk continues. “They assemble the best people for the job, energised by customers not managers, building psychological safety, and a collective commitment to deliver excellent, innovative results.”

In his recent book Next Generation Leadership, business educator and adviser Adam Kingl explores how organisations can enable younger talent to thrive. He sees the shift toward networked structures as a competitive advantage:

“Companies that reimagine how work is organised around projects and freelance experts will be sailing on a rising tide”, said Kingl.  “The volume and strategic importance of projects is growing.  About one-fifth of the world’s economic activity per year – $12 trillion – is now organised around projects.”

Over the next decade, Kingl says, “companies are expected to experience over two-thirds’ increase in project work”.  “As the operating environment becomes more volatile and complex, businesses need a new playbook to seize opportunities faster, an adaptive approach to talent and the skillsets that one might need at any point in time.  Organising company structure around project work may make more sense.”

2. Leaders become decision aggregators

Joe DiVanna is a Cambridge-based management consultant and author. As well as working regularly with Headspring clients on custom programmes, he runs his own innovation think-tank providing research and advisory services to the financial services industry. He says that the transition from a hierarchical to a network-based structure is essentially a change in how decisions are made. More traditional structures were based on the assumption that upper levels had “more collective knowledge and experience than the level beneath it” and therefore decision-making flowed up and down the pyramid. In network-based structures, this changes completely.

“This evolution strives to push decision making close to the action where the decision is needed”, says DiVanna. “As each node on the network becomes more and more empowered the entire role of senior leadership changes from a control point to approve or disapprove issues to a consultative resource to be consumed by the organisation”.

Yet, he argues, this change in organisational structure does not relinquish decision making of the senior leadership to the business unit: “What has changed is the parameters of what decisions can be used to empower people at all levels of the organisation”, he said.

As organisations go through this transition, DiVanna continues, “decision making often becomes fragmented. Not all decisions can be handled by the business unit. As a result, exceptions which need decisions become the underlying challenge (which is also an opportunity) for senior management to act as a decision aggregator.”

3. Mind the generational gap

While the network-based structure can help organisations move faster, Kingl warns that there is a significant generational gap when it comes to the acceptance of change and the adoption of networked structures.

“When I ask audiences to consider a world where companies comprise just a dozen or so executives and hundreds of freelance project directors and contractors under them – the gig economy writ large – Baby Boomers and older Gen Xs in the room appear ashen-faced and horrified, while the Gen Ys beam with optimism”, Kingl said.

In Kingl’s opinion, employers will have three possible responses to the inconstant tides of their younger workforce:

  1. Fight it and do everything in one’s power, spending whatever money is necessary, to keep talent,
  2. Embrace it and create the twenty-first century community of (mostly) freelancers,
  3. Select a hybrid path, distinguishing between talent that the company must keep at all costs and employees who one is prepared to let go, because their knowledge or expertise is replicable, or their functions may be completed more efficiently by contractors or business partners.

4. Your structure defines your culture

“Organisation structures define companies – culturally and innovatively, revealing both opportunities and limitations”, concludes Peter Fisk. “Henry Ford’s hierarchical business model that produced low-cost cars a century ago no longer reflects today’s organisational needs: to be fast and agile, human and technological, collaborative and creative, personal and global.”

According to Kingl, as the operating environment becomes more volatile and complex, “enterprises may choose to organise themselves differently, to be able to deliver more and more complex projects and initiatives in this dynamic operating environment.”

Thiago Kiwi

Head of Marketing & Communications at Headspring

Thiago is an award-winning marketing and communications leader with over 10 years of experience in the global higher and executive education sector. He holds a Bachelors in Communications and a Masters in Political Communications & Marketing from the University of London, as well as multiple executive and leadership development certifications. When he’s not busy studying for a new course, he’s growing vegetables in his allotment or training for his next marathon.
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How our brains hinder creativity

How our brains hinder creativity
Written by
Adam Kingl, author, keynote speaker and advisor

Published
22 Mar 2021

Our brains have learnt to sabotage our creative thinking efforts. Adam Kingl explains why taking the time for creativity can help address this issue.
Too many schools minimise or ignore creativity, too many parents discourage it, and too many companies devalue it. Our firms sometimes abrogate responsibility for innovation to a select fraction of the employee population, often someone with a lofty title like Chief Creative Officer, which of course communicates to the rest of the company that they should ‘leave creativity to the experts’.

If we observe how our leaders spend their time, and by extension how we should spend ours, too many are tacitly telling us that creativity is relegated to possibly a few minutes a week and ideally in one’s free time, not when we’re on the clock. In my advisory work to global corporations, I usually find this last condition, lack of time, to be the most common and pernicious.

Why we should make creative thinking a priority
The problem is that if we budget very little time in our lives to innovating or adapting to try new ideas, we typically incur a double deficit in our creative capacity.

First, we never make the time because creativity is always at the bottom of our priority list. Inevitably, we can never plan on all the firefighting and pop-up meetings that will occur in the week, so our real week is much more full of dealing with the day to day than our diaries suggested on Monday morning.

Allowing time for creativity is the only way to yield results
Second, if we do keep and honour a tiny fraction of our week or month to creative thinking, brainstorming and the like, we find our attention span is constantly distracted. We never seem to produce anything worthwhile as a result, and so we face each new window of opportunity for innovation with an ever growing, soul-sucking impression of dread or, at the least, resignation.

What we’re learning now is that we’re unfortunately training our brains to deliver this depressing result. Recent neuroscientific research has revealed how we repress and invigorate creativity. These hurried, captured moments of precious time for innovation yield paltry results. Our brains can’t turn on the magic for such short, unsustainable periods of time.

The five brain states explained
There are several brain states from deep sleep to deep focus and peak performance. The higher the performing brain, the greater the frequency of brain waves, hence Hertz is the degree of measurement:

Delta – deep sleep: 1-3 Hz
Theta – deep meditation, light sleep: 4-8 Hz
Alpha – relaxed, calm consciousness: 9-12 Hz
Beta – normal, alert consciousness: 13-30 Hz
Gamma – super-focused mind, increased brain power, peak state of consciousness and performance: 31-70 Hz.
Which of these do you think is our typical brain state during a normal work day?

I imagine many of you are thinking Theta! Sad but true – light sleep can be our normal work state. That’s rather depressing if that’s your normal. But Beta is probably our usual state, right? This is what we require of our brains to accomplish our normal tasks of answering emails, solving our workaday problems…and possibly Theta state when we’re in committee meetings.

Typical business routines encourage us to work in a state where the Beta waves (business as usual) in our brains are dominant, though we now know that maximum innovation and insight occurs when we are in Gamma state.

How to remain in Gamma state for longer
Neuroscientific research has also revealed that our brains can stay in Beta for a long time, and in fact are conditioned to stay there. As a result, if we crank the mental engine to get up to Gamma, the brain through habit easily and proactively often drags us back to Beta.

Therefore, if we need our brains to be in Gamma in order to be truly creative, genuinely adding previously unheard-of insight and exponentially big ideas, our brains would struggle to do that in, say, a one-hour meeting once a week. Beta state is like a constant and familiar noise, the ever-present static of our work lives that can block Gamma state. I liken this to how I find it hard to think when I’m eating an apple because I have this magnified, crunching noise in the echo chamber of my skull.

Mundane and creative – why getting the balance right is important
We can’t easily shut off this Beta activity, the laundry list of actions and decisions we have to make, even if we’re completely confident in our ability to make them. Beta is our habit, our rhythm, our tyranny.

Because we don’t have balance between the mundane and the creative, we can’t achieve creativity even if we give ourselves those fleeting thirty minutes a week to do so. We must change our routines so that we give our brains more time to marinate in Gamma and increase the frequency of those marinades. Like any muscle, the creative function in our brains requires exercise in order to improve, but as importantly, to be receptive to create in the first place.

The point is not that we denude all traditional routine from our organisations. We need some of that. But most of companies that I’ve experienced usually operate at a ratio of about 99% business as usual to 1% creative time…on a good week! So if you’re feeling uncomfortable that I’m suggesting something like a fifty-fifty balance, I’m not saying that. But the better ratio surely has to be closer to eighty-twenty at least? I’m merely entreating us to ask ourselves honestly, ‘Is the balance right?’

Adam Kingl is the author of Next Generation Leadership (HarperCollins) and is a keynote speaker, educator and advisor. www.adamkingl.com

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The three things millennials want if they are going to work for you

The three things millennials want if they are going to work for you

Leadership expert Adam Kingl believes a new way of thinking is needed to retain and attract Generation Y talent.

London Business School

How Best To Manage Millennials

How best to manage Millennials

Gen Y is poised to transform the future of work, management and leadership. Enabling them to thrive and deliver value takes serious thought

For generations gone by, the only way to get on in work was to pay your dues. Promotion, reward, the steady ascent up the corporate ladder were all earned and paid for by commitment to the job, loyalty to the company and – perhaps more than anything else – by putting in the time. It took time – several years usually – to really learn the ropes and to demonstrate readiness for more responsibility.

Then Generation Y (aka Millennials) arrived in the workplace and turned much of this on its head. HR leaders and managers of Gen Y were shocked by a new wave of workers who are prone to leave their jobs with frightening rapidity. This is a generation that stays around for two to five years before moving onto the next opportunity; a cohort that cleaves more to purpose than to material reward, that demands to know why as much as what they are required to contribute or accomplish, and whose primary allegiance is not to the organisation but to the immediate team and the individuals who surround them.

Generation Y are, of course, the leaders of tomorrow. And they are starting to accede to positions of influence today. They are also causing friction with incumbent leaders who don’t know how to manage them.

So says Adam Kingl MBA2004 in his book, Next Generation Leadership: How to Ensure Young Talent Will Thrive With Your Organization. An educator, author, advisor, keynote speaker and alumnus of London Business School, Kingl had plenty of opportunity to observe Generation Y, as well as the organisations who hire them: ‘I directed, then supervised that is now titled the Leading Teams for Emerging Leaders programme at LBS for several years, working with young, high potential participants.  Since they were nominated by their organisations to attend, they are, more likely than a random selection of Gen Ys, the CEOs and leaders of the future. But their bosses just don’t know how to deal with them.’

The core issue, says Kingl, is a shift in priorities, expectations and values – a sea-change in the paradigms of work and leadership that set the upcoming generation apart from (and very often at odds with) the incumbents. And it’s not Gen Y’s fault.

“You have to remember that this is a generation that won’t have the security of retiring on a defined benefit (final salary) pension,” he says “The golden handcuffs and a job for life simply don’t exist for them. They’re also the first generation whose majority will experience the 100-year life, as explained by Professors Lynda Gratton and Andrew Scott.

Longer life, shifted expectations

“Now, as we live longer, the expectation is that we’ll also have to work longer; the luxury of retiring at 65 will be replaced by the necessity in many cases of working into our 80s. Millennials will be spending probably 60 years of their life working, and that has shifted expectations and driven a feeling of optionality and greater flexibility in terms of where they work, who they work for and how long they choose to stay.”

Gen-Y workers are also demonstrably less materialistic than their forebears, argues Kingl. Salary, bonuses and promotions, while important, compete with concepts like purpose, development, culture and work-life balance. Capitalism, for Millennials, is a fungible concept, and as these emerging leaders assume influence, we are likely to see a swing in focus from outcomes to outputs: from bottom line and share prices to impact and value for customers, employees, communities and the world.

To manage this new generation more effectively, says Kingl, and to ensure that they thrive, organisations need to start thinking differently: “I believe there’s an onus on today’s leaders to recalibrate their own ideas and expectations when it comes to managing the leaders of tomorrow. There are things that the Boomer and X generations have to let go: the idea that young talent will stick around forever, that investment in things like development and training are tied to tenure, or that emerging leaders must be 100% dedicated to their job at the expense of all other interests or activities. We need to embrace their agility and recognise that the workforce can be a little more fluid without damaging our long-term prospects.”

But how do we enact this kind of shift in thinking?

Kingl’s work at LBS with emerging leaders and their companies has yielded key insights. For five years, he surveyed Generation Y participants, then interviewed them, their employers and other organisations across 44 countries, complementing the quantitative evidence with qualitative analysis across a sample that spans highly diverse industries and sectors.

His findings, which are shared in the book, point to a broad homogeneity in Millennial priorities – a generational “tightening” that stems from having much in common. They are the first truly global generation, the first to be digitally connected from the start, and a generation who will live – and work – longer than their predecessors by a considerable margin. Kingl believes that this consistency or homogeneity makes it possible to see Gen Y as a more coherent group, while recognising that to discuss generations does force one to generalise.  But he urges not to dismiss the findings merely because one can find an exception: “If we can better understand patterns and trends that are more true than not, then this can only benefit our ability to manage and empathise with our youngest colleagues.”

And this, in turn, makes it possible to distil insights about them into actionable ideas for their managers: practical frameworks, strategies and tools that he shares to ensure that young talent can thrive within today’s organisations.

Six ways to manage Millennials

The following are six tips from Kingl’s book to help manage Millennials.

#1: Articulate and live your purpose

Be proactive in terms of articulating your purpose and help your people connect their own purpose to that of your organisation. An impactful and cost-effective means of doing this may include putting together a workshop built around two central ideas: Why should talent work here versus anywhere else?  Why should customers come to us versus anyone else?

#2: Hold one another to account

Organisational culture is something that needs to be engineered versus emerging organically. Aim for transparency, responsibility and accountability as a rule, and be clear about the kinds of behaviour that model your organisation’s ethos.  Consider what behaviours, if shared among your bellwethers, should become new norms.

#3: Be fluid about development

Understand that development opportunities should not be tied to tenure. There are a host of cost-effective measures your organisation can take to weave training and development into everyday life, from shadowing to coaching to international placements to secondments. Aim to think more dynamically about this theme.

#4: Re-consider what work-life balance means

The number one thing that Gen Y asks for from their employers is work-life balance.  Too many organisations have resisted this request, but we all are now confronted with the necessity of remote working because of Covid.  Even when we exit the pandemic, our global, digitally connected workforce will inevitably have to get a lot better, and a lot more comfortable, with managing virtual teams.  We will not go back wholly to the way things were.

Before lockdown, the term “work-life balance” was often a contentious topic. Kingl discovered semantic discord between the generations when it came to having a common definition of work-life balance. For Baby Boomers and Generation X, asking for work-life balance sounds like a “when” request, concluding incorrectly that young people requesting work-life balance just want to work less than their seniors when they were paying their dues, leading to the common misconception that Gen Y must be lazy.

Work-life balance: when, not where

For Generation Y, work-life balance is a “where” request: they see the 9-to-5, chained to the desk, face-time model as archaic when technology makes it possible to have constant access to work. Emerging leaders want greater flexibility and a higher degree of agency or autonomy – some margin to choose where and how they work.  Be sure that you are all on the same page and that you aren’t talking about terms that mean different things to different people.  Our current world environment amidst self-isolation is a good time to practice working remotely yet effectively.

One insight that Kingl discovered after running an experiment with his London Business School programme cohorts is that some types of activities will yield better results if they are conducted virtually instead of face to face.  For example, brainstorming innovations or solutions to intractable challenges require as many insights as possible and reducing the noise of the usual voices who dominate the conversation.  An asynchronous virtual discussion board to solicit and respond to ideas can disintermediate a lot of the dysfunctions of dominating voices due to factors such as status, gender, culture or personality.

#5: See the value in side-hustles (activities that employees pursue outside work)

Talented young people often have interests that go beyond their role or the organisation. Whether those are charity work, personal websites or projects that leverage professional skills, try to reframe these activities as sources of dynamism and opportunities for intra- and entrepreneurial development. Encourage your employees to pursue opportunities to learn and to share that learning.

#5: Be flexible about people leaving

After all, they might well come back. Encourage a sense of fluidity that leaves the door open so that after your leavers build new skills and knowledge outside your company, they might bring that back to your organisation should they choose to return further down the line. Embrace this fluidity and find ways to make it work to your advantage. Many professional services firms are world-class at cultivating an alumni network of former colleagues, even hosting reunions!

As Generation Y accedes to leadership, Kingl believes the world of work is set to become ‘more human’.  The real challenge for today’s employers is to leverage this forward momentum to the advantage of the organisation – and the advantage of young people driving change.

“Research, polls and surveys repeatedly tell us that the majority of employees in today’s businesses are not engaged,” he says. “The management models that we have in place come from a time long past and are no longer truly fit for purpose. Generation Y feels this keenly, and this is the generation that feels the urgent need to fix it.  It’s our responsibility as leaders and managers to empower them as they prepare to rehumanise the world of work.”