Indholdsfortegnelse for Spring 2010 i Rotman Management

I am not a businessman. I am an artist. -Warren Buffett WE EXPECT TO FIND ARTISTRY IN THE FINE ARTS, but in truth it escapes those boundaries on a regular basis. And while it is diΩicult to describe, most of us recognize it when we encounter it: we taste it in the dishes of a great chef; we see it in a star athlete’s performance; and we hear it in the words of an accomplished leader. It is no accident that people use the term ‘artist’ to refer to practitioners that are unusually adept at handling difficult situations. To paraphrase the late Donald Schön, author of The Reflective Practitioner, ‘the artistry of painters, sculptors, musicians and designers bears a strong family resemblance to that of extraordinary lawyers, physicians, managers and…

WHETHER WE WORK IN A HOSPITAL, a bank or a consulting firm, we all face problems that run the gamut from the simple to the complex. Simple problems are comfortingly clear: we know where we have to go and how to get there. Such problems often come with a set of instructions, so that anyone following them can arrive at the same solution. The steps involved are relatively few; the diΩiculty level, relatively low. Most managers would agree that fewer and fewer of today’s problems qualify as ‘simple’. The complex problems we face nowadays go by many names: ‘social messes’, ‘wicked problems’ and ‘big hairy problems’; I like to call them ‘enigmatic problems’. As the definitions of ‘ends’ (where to go) and ‘means’ (how to get there) become more ambiguous…

CHARLES AND RAY EAMES – two of the 20th century’s most influential designers – are best known for their timeless furniture, which looks no less modern today than it did when they designed it more than 50 years ago. What is less known about the Eameses (pictured, left) is that they were also passionate educators who sought tirelessly to help people learn how to see their world anew. Working with leading corporations, they created more than 60 films and slide shows for clients like IBM, Boeing, Polaroid and Westinghouse, visually communicating complex ideas in new ways. Charles once said that these projects were intended to give the viewer a ‘new depth of vision’, and as such, they proved invaluable, inspiring leaders to think beyond the status quo and envision new…

THE DESIGN AND PRODUCTION OF NEW PRODUCTS AND SERVICES is an endeavour that calls for the skills and experience of interdisciplinary teams to get the job done. Yet, as a half-century of research makes abundantly clear, teamwork is di≈cult. The competing viewpoints that promote creative ideas and sound decision making can also lead to conflicts that waste precious time and erode relationships. Studies of teams in a variety of settings show that team effectiveness is a function of a well-designed task, appropriate team composition and availability of information, resources and rewards. However, much of the research to date has studied routine teamwork with relatively homogenous team members, and thus the findings need to be revisited for new product development teams, which tend to vary on these attributes. Recent research has…

DESIGN THINKING IS RECEIVING a great deal of attention as increasing numbers of innovative organizations succeed in solving complex problems by creative means. In doing so, many of these firms implement specific ‘design methods’ such as observational research, iterative prototyping and storytelling alongside more mainstream approaches. But as any professional designer will attest, design thinking entails much more than applying methods: to create value, methods must be applied together with design sensibilities. Design sensibilities consist of the ability to tap into intuitive qualities such as delight, beauty, personal meaning and cultural resonance. Such subtle qualities are difficult to put into words, and thus are generally discounted in the workplace. Managers schooled in analytic and rational decision making may find the idea of relying on their sensibilities uncomfortable. But when coupled…

GIVEN THE MYRIAD CHALLENGES WE FACE, 21st century society yearns for a leadership of possibility, a leadership based more on hope, aspiration and innovation than on the replication of historical patterns. Luckily, such leadership is now possible: for the first time in history, companies can work backward from their aspirations and imaginations rather than forward from their past. As design guru Bruce Mau has said, “The gap between what can be imagined and what can be accomplished has never been smaller,” and as a result, the defining question – and opportunity – for us is this: now that we can do anything, what will we do? Responding to this question demands levels of imagination and creativity that have been more the domain of artists than of managers, and as a…

Here are some companies who exemplify characteristics of successful orchestration: • Nokia operates an open innovation model in which it uses external talent to drive the delivery of new products and services – making abundant use of social computing to source new ideas. Its ‘Beta Labs’ website plays host to hundreds of thousands of testers who provide feedback on new and potential Nokia apps, while the ‘Nokia Pilots’ program lets users communicate their ideas about product and service improvement. ‘Forum Nokia’ – a portal available in English, Chinese and Japanese – gives outside developers access to resources to help them design, test, certify, market and sell their own apps, content, services or websites via Nokia mobile devices. Also, company wikis post the progress of current projects. • Li & Fung…

FIFTY YEARS OF RESEARCH HAS CONFIRMED the obvious: that freedom and autonomy are essential to human well-being. To be free and autonomous is to be able to make choices, meaning that no one compels you to do anything and that there are real options to choose among. Unless people can exert significant control over the events in their lives, they are diminished. At the level of entire societies, there is evidence that democratic political organization, including the protection of civil liberties, has a bigger eΩect on life satisfaction than does material aΩluence – at least among those whose material needs are being met. A central aim of public policy in a democratic society should be improving the welfare of citizens. Even when resources are plentiful, this is an extremely challenging…

WHEN 16TH-CENTURY BRITISH poet John Donne coined the phrase “No man is an island,” he could not have known how pervasively it would come to signify the significance of other people to every individual’s sense of self. Indeed, we routinely identify ourselves by shared characteristics, whether it be demographics such as race or gender, organizational a≈liations such as employment or church membership – or even minimal group memberships established arbitrarily in a laboratory. However, such ‘possessed characteristics’ are not our only source of identification: characteristics thatwe do not possess or groups to which we do not belong can be equally informative to our sense of self. That is, at times individuals identify negationally, focusing on who or what they are not, as when they state ‘I am not an economist’…

AT THE BEGINNING of the primary election season in 2008, Barack Obama, then the junior U.S. Senator from Illinois, was still an unknown political entity, at a distinct disadvantage to frontrunner Hillary Clinton. “Before too much time passed and mythology developed, it was important to capture events as we saw them,” says David Plouffe, campaign manager for Obama's primary and general election victories. “The campaign you saw in the media was very different from the one we were running,” says the author of The Audacity to Win: The Inside Story and Lessons of Barack Obama’s Historic Victory. Plouffe shared his insider’s view in a November presentation at the Rotman School. “Basically, we were a start up running against the political establishment,” he says. “Clinton had the existing voters from the…

IDEO, the design powerhouse based in Palo Alto, California, is renowned for applying creative solutions to organizational challenges in fields ranging from consumer product design to management consulting. As the consultancy has grown – it now encompasses eight offices and engages in 500 to 600 projects a year – it has striven to preserve the hands-on, collaborative culture that fueled its success. Gentry Underwood, IDEO’s lead designer and head of its knowledge-sharing domain, has spearheaded an effort to use technology to preserve the company’s sense of intimacy and teamwork. On January 28, Gentry discussed his findings in a session titled “Knowledge Sharing at IDEO: Designing for Social Interaction”, part of the RotmanDesign Thinking Experts Speaker Series. Gentry, who was a software designer before leaving Silicon Valley to study Psychology, Anthropology…

WE LIVE IN A WORLD THAT IS PREOCCUPIED with predictability and enraptured with quantitative analysis. In the realm of business, the evidence is clear: forecasters crank out precise predictions of economic growth using massive econometric models, and CEOs give to-the-penny guidance to capital markets on the next quarter’s predicted earnings. In the world of health care, geneticists sequence the human genome and predict the elimination of numerous diseases. In our day-to-day lives, we are governed by adages like “Show me the numbers” and “If you can’t measure it, it doesn’t count.” Where has this obsession gotten us? Not far, I would argue; the economists, for one, have gotten it consistently wrong. As late as the middle of 2008, none of the world’s leading macroeconomists or forecasting organizations were predicting that…

SLOWLY BUT SURELY, MODERN MANAGERS ARE realizing that the complex situations they face cannot be approached in a routine manner. Indeed, the quest for creative solutions has become pervasive. Until now, the term ‘creativity’ in the business arena has mostly applied to the use of specific techniques such as brainstorming. While such techniques can help open people up to new ideas, they are limited in their ability to help us optimize the creative potential in our midst. If creativity is to truly add value to an organization, its managers must first understand its core principles. In this article we will attempt to define those principles and highlight the critical role that imagination, inspiration and intuition have to play in modern business. Creativity = Capital Artist Joseph Beuys (1921-1986) dedicated his…

THE WORLD HAS GROWN MUCH MORE COMPLEX in recent years – that much is obvious. However, what we can do to thrive within this increased complexity is far from evident. The economy’s evolution towards more immaterial, knowledge-based products and services presents an endless list of open-ended questions. In this article, we will tackle one of them: what is the best way to lead knowledge workers for optimal creative output? A new source of inspiration for creative leadership and development comes from the world of the Arts. While the Arts have inspired people for centuries, greater attention is now being paid to learning from artists themselves. In our own work with artists and business people, we have uncovered two key approaches for applying artistic methods in business: the development of artful…

WITH MANY THINGS IN LIFE, progress comes at a price. As our rapidly-globalizing world has increasingly become ruled by technology, we have regressed in an important way: we have literally lost touch with each other. Our senses have dulled and business has suffered. The time has come to rethink and reframe ourselves and our organizations. In our work with leading firms we have yet to meet one that does not covet a culture where: • Team play is a given and everyone has their eye on the same prize; • Experimentation is welcomed, not punished; and • Pride and playfulness, self-interest and collaboration, and structure and freedom stand side by side. The good news is that such a culture is not beyond reach: these characteristics describe the culture of many…

Virgin America has differentiated itself from its competitors by providing customers with a rich set of experiences based on design sensibilities, such as luxury and style, which have been applied to its service scripts, amenities, industrial and environmental design and more. Its holistic approach is evident from the moment a passenger checks in. Virgin’s self-serve kiosks feature the same design aesthetic as the interiors of its planes. Each computer’s glossy white chassis and glowing red interface foreshadows the seating and personal entertainment systems offered in the main cabin. When passengers check in, the kiosk prints credit card-size boarding pass for each one, VIP-style, which elevates the boarding process from an informational transaction to an event. While other airlines settle for a tissue-thin paper receipts, Virgin issues a permit that suggests…

Your latest book is about ‘clever people’ and the challenges involved in leading them. How do you define clever? Clever people are employees whose skills are not easily replicated and who add disproportionate value to their organizations. Often, these people are smarter than their bosses and most of them don’t really want to be ‘led’. That’s what they say, anyway; whether or not they mean it is another question. The ones we studied for our book actually needed organizations in order to express their skills and talents. For instance, if you’re a brilliant pharmaceutical researcher, you can’t produce the next great breakthrough drug on your own; you need the resources of a large pharma company and you need to work in a big, global team – typically for seven or…

You believe that everything we know and desire is the outcome of a single discovery that was made 1.9 million years ago. Please explain. The discovery you speak of is fire, and it represents the first moment in history when civilization transformed itself. The transformational part came when humans discovered that fire could be put to beneficial uses, which vastly changed our behaviour and expectations. What is interesting to note is that fire already existed in the environment, it just wasn’t being put to a beneficial use. People came across it and observed it, but it had no ‘media’ for humanity, because we didn’t use it to accomplish anything. It only became a ‘disruptive innovation’ when one day, somebody figured out how to preserve it and then someone else –…

A FIRM’S BUSINESS MODEL – defined as its approach to generating revenue at a reasonable cost – incorporates assumptions about how it will both create and capture value. While every firm has such a model, legendary firms that shape their industries – such as Google and Apple – are business-model innovators that organize themselves and their interactions with customers and suppliers in unprecedented ways, inspiring others to both direct imitation and further innovation eΩorts of their own. In a recent paper with Professor Alfonso Gambardella of Bocconi University in Milan, we reported on the characteristics of innovative business models. One arena in which many firms with important knowledge assets are currently innovating is in rising ‘markets for technology’, whereby rather than directly commercializing products and services themselves based on knowledge…

You are one of the few poets to take your perspectives on creativity into the field of organizational development. How did this come about? I am a poet first and foremost, and all the work I do in various fields comes from the poetic tradition. Poets work with the conversational nature of reality, and so I work with business leaders on ‘courageous conversations’. These are conversations that, for many reasons, are being avoided. A few years ago, I was working with a food conglomerate whose hidden ‘courageous conversation’ was essentially about their contribution to obesity in American society. Whereas individually, their snacks brought a great deal of pleasure, collectively and cumulatively, they were not doing society much good. The topic, as you can imagine, was taboo and di≈cult for the…

WHILE MOST PEOPLE were finishing off their New Year’s celebrations, two groups of Rotman MBA students were on the road, far from home, as part of an international study tour. One group visited China and the other travelled to the United Arab Emirates (UAE) and Jordan. The tours came at an interesting time as the world struggles to recover from a recession that has caused many to re-examine past business and economic practices. “These tours are organized to provide our MBA students with a firsthand experience in these increasingly important emerging markets,” says Richard Powers, associate dean and executive director of MBA Programs. “During the two-week tours, students visited local government organizations, Canadian and International companies as well as local businesses to learn more about market entry, partnerships, joint ventures,…

THE ROTMAN INITIATIVE FOR WOMEN IN BUSINESS is among 16 training programs that recently received funding from the Government of Ontario. The $2 million in funding will support Business Edge, a program for internationally-trained women professionals. “There has never been a more critical time to invest in internationally trained women who are working in Canada,” says Professor Beatrix Dart, associate dean, Executive MBA Programs and executive director of the Initiative for Women in Business. “Not only are these women, for the most part, highly overqualified for the positions they hold, but they are also having a more difficult time advancing in their careers. With the looming talent shortage in Canada, women – especially those trained outside of Canada – are a group that we ignore at our peril. With this…

Olympic Fever hit us all this past winter. At least four of our alumni had the honour of carrying the torch, including our intrepid benefactor Dr. Joseph Rotman (MCom ’60) and wife Sandra, who did the honours in Scarborough. More stories below. Reunions are coming up fast, so if you are in honoured years (those that end in a ‘0’ or ‘5’ – ‘quinquennial’, for those who like long words) and haven’t heard about an event, please contact us at alumni@rotman.utoronto.ca. Reminder: our 12th annual Life-Long Learning Conference is slated for May 27, at the Carlu in Toronto. We hope to see you all there. A new feature for those who love to read the Class Notes section: a new ‘supplement’ is now available online, at rotman.utoronto.ca/magazine/spring2010CN/ (and posted in…

It has been said that the artistry of painters, musicians and designers bears a strong resemblance to the artistry of extraordinary managers, lawyers and physicians. Do you agree? Absolutely. The similarity between them has to do with the nature of the elements that people must attend to in creating anything. For example, if you’re a lawyer and you’re putting together a legal brief, you have to pay attention to its composition, to the nature of the language being employed, and to the texture of the argument. Importantly, each of these elements is qualitative rather than quantitative in nature, which indicates that there is artistic thinking going on. A key element of artistry is the ability to experience ‘qualitative relationships’. Please describe this ability. The world can be said to consist…

Karen Christensen: You have said that, “As business becomes more dependent on knowledge to create value, work becomes more like art.” Please explain. Robert Austin: Modern managers increasingly work in the realm of knowledge and ideas. Whether you are designing a new product or running a business in volatile conditions, the journey involves exploration, improvisation and adjustment, and in many cases, you can’t know your destination in advance. With this kind of work, time spent planning is better spent actually doing – trying things that you haven’t thought out in detail and quickly incorporating what you learn into your next attempt. This is what artists do, and as a result, knowledge work can and often should be structured as artists structure their work. KC: What does it mean to work…

According to Fast Company magazine, one of the most creative companies in the U.S. is W.L. Gore & Associates, a privately-held organization best known for Gore-Tex fabrics, Glide dental floss and Elixir guitar strings. W.L. Gore employs over 6,300 people and sells over 1,000 products. Since its inception in 1958, it has enjoyed double-digit annual revenue growth. While it is not likely that founding father Bill Gore has been explicitly applying aesthetic intelligence to his decisions, they nonetheless embody it and provide a platform for understanding aesthetic intelligence in action. Gore has said that “improvising ensembles are the purest form of group genius” and that “innovation is inefficient and is not time bound.” To this end, each of the company’s facilities houses up to 200 people, a mix of R&D,…

WHILE SIGNIFICANT STRIDES HAVE BEEN MADE to abolish discrimination in the workplace, gender remains one of the most salient social categories that exists within organizations. It is perhaps surprising, then, that research on the effects of gender diversity has been characterized by mixed findings: such diversity has been found to be beneficial in some circumstances, but detrimental in others. Harvard Professor Rosabeth Moss Kanter’s Theory of Proportional Representation suggests that the increased visibility derived from being numerically underrepresented in a group generates extra performance pressures for women, requiring that they perform at a higher level than their male counterparts to be evaluated similarly. Subsequent research has supported Kanter’s claim, showing that the effects of minority status are more pronounced when only one or a few demographically-different people are present in…

MANY EXECUTIVES ARE eagerly awaiting the return of better business conditions. But in doing so, they may have overlooked a significant source of growth and productivity that is emerging right now: new economic models that are redefining the relationships between firms and consumers. New economic models, underpinned by an array of technologies, are emerging in which traditional relationships between firms and consumers are being simultaneously dismantled and redefined. In these new models, consumers are becoming involved in the production and innovation process; sharing information and opinions about products and services; and combining in diΩerent ways to create content in peer-to-peer markets. At first glance this seems to run counter to our understanding of how markets function. Traditional explanations such as Ronald Coase’s Theory of the Firm emphasize the central role of…

THE DEFINITION OF THE WORD ‘create’ – to cause to exist; to bring into being – implies something profound, almost spiritual, which is perhaps the origin of the phrase ‘divine inspiration’. Despite considerable progress towards understanding what causes and facilitates creativity, one of the more common assumptions about it – that experiences in foreign countries can foster it – remains largely unstudied. Living abroad is often seen as a necessary experience for aspiring artists, and there is abundant anecdotal evidence for the idea that creative individuals produce their best-known masterworks during or following a stint abroad. This is perhaps best exemplified by the thriving community of expatriate American writers in Paris in the early 20th century, including Earnest Hemingway, F. Scott Fitzgerald, Gertrude Stein, and Ezra Pound. In addition to…

What does it mean to ‘Glow’ in the workplace? People who Glow have mastered three distinct areas of their lives: they have built deeply trusting and cooperative relationships with others; they have extended their networks beyond the obvious to encompass the unusual; and they are on an inner quest that ignites their own energy and that of others. When you Glow, you are able to create or find and flourish in what I call ‘Hot Spots’. These are times, places and occasions when whole groups or communities become highly energized and innovative. The challenge for us all is to learn how to Glow and then create, find and flourish in Hot Spots. You recommend that we ask ourselves some key question on a regular basis. Which ones? Wherever you are…

THE FIRMS THAT WILL SUCCEED in the future will be those that can advance knowledge faster than their competitors. This according to Dean Roger Martin who, in a November presentation of the Design Thinking Experts Speaker Series, discussed “Why Design Thinking is the Next Competitive Advantage” with Claudia Kotchka, former vice-president of innovation, design and strategy at Procter & Gamble and Dr. Steve Scherer, director of the Centre for Applied Genomics at the Hospital for Sick Children. In 2001, when Kotchka became the first head of design at P&G, the company was in urgent need of an overhaul: its stock value had dropped 50 per cent in the previous year and its products were generating little excitement among consumers. Then-CEO A.G. Lafley had a new mantra of ‘the consumer is…

THE TIME HAS COME to turn Canada’s supplemental pensions jumble into a coherent system with a clear goal and a clear plan to achieve it, according to Keith Ambachtsheer, director of the Rotman International Centre for Pension Management and an adjunct professor of Finance at the Rotman School. In the 2009 Annual Benefactors Lecture, published by the C.D. Howe Institute, Prof. Ambachtsheer sets out the goals of such a system and the principles on which it should be based. After reviewing current shortcomings, he proposes a two-pronged plan for turning supplemental pension arrangements into an integrated, effective system. The following principles should guide reform, he says: 1. Pension plan designs should target a post-work standard of living that is adequate, achievable and affordable; 2. All workers should have a simple,…

Babitha Mundenchira (MBA ’07) Assistant Vice President JPMorgan Chase Lives and works in: Boston, Massachusetts BEST THING ABOUT MY JOB:Working for a global corporation gives me the chance to travel and work in diverse cultures and departments. MY BIGGEST CHALLENGE:The hours. MOST IMPORTANT SKILLS FOR MY JOB: Job ownership and going above and beyond what is required. PROUDEST MOMENT: Holding my best friend’s daughter in the labour room. THE WORD THAT BEST DESCRIBES ME:Versatile. HOW I RELAX: Taking my dog Timon for long walks. MOST IMPORTANT THING MY MBA TAUGHT ME: Never give up on a goal or ambition, no matter how high the stakes or how long it takes to accomplish it. WORDS OF WISDOM: Everything in life is temporary; but do, learn and say things with the faith…