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The Ecology of Leadership by Peter M. SengeLeader to Leader, No. 2 Fall 1996Thought IN the past 5 years, corporate leaders have talked more about Leaders learning and development than in the previous 50. But the Forum: discussion inspires frustration as well as hope. Senior Peter M. Senge executives invariably want to know, "How do I build a learning organization?" It is the most frequent question I am asked, but Peter M. Senge is director it is the wrong question, for two reasons. First, it implies that of the Center for the president or CEO can singlehandedly make changes in an Organizational Learning at MIT's Sloan School of organization's genetic code. Second, it suggests that building a Management. He has learning organization (and learning itself) involves a definitive helped leading corporations, including formula rather than an ongoing process. Federal Express, Motorola, As with any lasting change, the senior executive's ability to and Intel, improve their implement a true learning organization is overrated. Most group learning capacity. He is author of The Fifth people who reach the top of an organization soon find they Discipline, one of the besthave little unilateral power to control its complex workings. selling books of the decade, That reality led the CEO of an international energy company to and The Fifth Discipline Fieldbook. (9/96) call the word drive -- as in "How do you drive change?" -- the More on Peter M. Senge most useless word in the language. "You drive an automobile," From Leader to Leader, he says. "You don't drive a human system. If you try, you might No. 2 Fall 1996 Table of end up doing more harm than good." Contents If you doubt the limited power of chief executives, consider the From the usual ways they try to bring about change: They articulate new Editors Resources strategies. They devise new cost-cutting campaigns. And, most popular of all, they restructure their organizations -- often more Additional resources for this than once. They do so because there is little else they really article can do. They don't design or produce products. They rarely sell directly to customers. And they are usually too far removed to demonstrate the connection between the strategies they devise and the work of people at the front line. Executive leaders can develop guiding principles. They can change their own ways of thinking and interacting, and thereby become a persuasive role model. They can and must develop strategies for building a sustainable competitive advantage, which means creating an environment in which people are open to new ideas, responsive to change, and eager to develop new skills and capabilities. Above all, to sustain change -particularly change requiring new organizational capabilities and collective intelligence -senior executives must do two things: develop personal learning strategies, and understand the context in which they work.
The Context for Change
ORGANIZATIONS work the way they do because of the way people work in those organizations. Deep organizational change requires a change in people. Redrawing the lines and boxes in your org chart without addressing the way people within the organization interact may be like rearranging the deck chairs on the Titanic.
While many executives acknowledge the need for leaders at every level of the organization, they rarely manage the enterprise as if those leaders existed. They fall into a trap that has become embedded in our language; they confuse rank with leadership. The belief that the leaders are only those with executive titles and corner offices serves to reinforce the lack of initiative, enterprise, and entrepreneurship that these same executives rightly say is stifling their organization. Truly innovative, adaptive companies recognize that a healthy leadership ecology requires three kinds of leaders: local line leaders (branch managers, project team leaders, sales managers, and other credible front-line performers); internal networkers (front-line workers, in-house consultants, trainers, or professional staff who spread ideas throughout the organization); and executive leaders. All three have an essential role to play. Without the initiative of local line leaders, no change effort will get very far. Without internal networkers, innovative practices rarely spread. Without executive leadership, the overall corporate climate will continually thwart basic innovation.What People Want from the Boss
ONCE you see the necessary interdependence of these different types of leaders, the next step is to ask, "What do local line leaders and internal networkers need from executive leadership?" It's a powerful question that spotlights the role of senior executives. If we don't ask the question from the perspective of those inside the organization, we end up asking what the investors or the board of directors need from the executive leaders. And that perpetuates the dangerous myth that "senior executives must drive change." What local line leaders and community builders ask of their executives usually falls into two categories. First, they want conceptual leadership: Where are we trying to go and why? (The why is as important as the where.) Where have we come from? What are the deep insights about our business and market and what has made us unique? (For additional diagnostic questions, see the sidebar, "Asking the Right Questions.") In short, what people are looking for is not the leadership of exhortation, it's the leadership of clarification. In a world where decision making is distributed throughout the organization, where front-line people are involved in what often turn out to be strategic, not just operational, decisions, executive leaders have a new responsibility to contribute to the quality of thinking throughout the organization. The second thing that people look for from their senior executives is personal commitment -- to learning, teamwork, or whatever key ideas and values are being advanced. One of the most important ways executives can demonstrate their commitment -- and their credibility -- comes through how they work within their own teams.Where Executives Miss the Mark
A healthy team is one in which an outsider would leave a meeting thinking, "These people are really good at talking through tough issues. There's a lot of candor and a lot of willingness to challenge one's own thinking, to lay out tough issues and say
The learning capabilities of teams tend to deteriorate steadily the higher you go up the corporate ladder.
"Here's something that I don't understand.'" Unfortunately, such gatherings are rare. The learning capabilities of teams tend to deteriorate steadily the higher you go up the corporate ladder. The top team is often the most dysfunctional of all. Why? The precondition for building a team is that people perceive themselves as needing one another. And a lot of senior executives don't perceive this with respect to the other members of the top team. They focus on their own functions, their own turf, their own agendas. That lack of perceived interdependence is in part a result of the way we select and promote people. If you look at our classic leadership profile you see people who are strong individual contributors -- forceful, articulate, and ambitious. They have steadily advanced in their careers, ideally because of their ability to produce results but often because of their ability to make impressions. They're great political figures but often not particularly good team players. I know corporations where everyone at the executive vice president level and above is over six feet tall. That sounds like a strange coincidence, unless a primary criterion for the post is image.A New Role for Hierarchy
IT'S easy to bash corporate hierarchy. Hierarchical authority as it has traditionally functioned is the authority of compliance -- and compliance won't get you far in today's fluid, fickle marketplace. But hierarchy still has important functions, especially if we can learn to recognize its limitations and to adapt it to the changing nature of leadership. Canadian researcher Elliott Jaques has suggested an important foundation for management hierarchy, based on a little-understood responsibility of executive leaders. In any organization, different people need to have different time horizons. People at the front lines who are dealing with customers or producing goods typically have a perspective that may stretch to months, perhaps in a long-term customer relationship, years. But it more often spans weeks, days, or even hours. The nature of the work requires that short-term perspective. At the other extreme, the most senior levels of an organization should be looking out 20 years and longer. Based on this reasoning, Jaques justifies up to seven levels of "requisite" hierarchy, based on accountability for different time horizons. (Of course, many companies' horizons don't extend beyond the expected tenure of the CEO, so you might argue that U.S. corporations lack the top two or three levels of hierarchy altogether.) So from both a practical and theoretical standpoint, senior executives are expected to provide insight and vision about how the world is evolving over the next 10 to 30 years. But Americans probably have less sense of history than almost any culture on the planet and we seem to be, if anything, hell-bent on having even less sense of history. Understanding the past is yet another capability that senior executives, in particular, must develop.Strategies for Personal Learning
ACTION learning -- a current buzzword for meaningful learning on the job -- is a hot topic among corporate trainers. It's a fine notion, but too often theories of learning exclude those at the top. Can senior executives learn on the job? The answer better be yes, because if they can't learn on the job, they can't learn anyplace else. All learning processes really come down
to what one does on a regular basis; you don't develop new capabilities in small doses. They have to be continually reinforced and refined and enhanced. Consultants may help Historically, most senior executives didn't see themselves as solve a problem, but they needing to learn much of anything. They were not learners, they rarely transfer the skills were decision makers. Learning was something they did in school that enable them to help. -- and, by implication, stopped doing when they left school. (Of course, real learning begins when you leave school.) When top managers were honest enough to acknowledge they didn't know the answer to a problem, they would hire consultants. And because they want to keep getting their bills paid, many consultants end up colluding with this antilearning mind-set -- they help solve a problem but rarely transfer the skills that enable them to help. Today I think more managers are becoming aware of their need to develop new capabilities. Senior executives are more motivated than ever to foster the kind of dialogue and honest inquiry that are essential to all learning.How People Learn
AT the senior executive level, you have to ask how to make learning a continual part of your day-to-day experience. Formal training and education programs have a role to play, but it is a limited role. The most effective training programs are catalytic -- creating a very new experience, getting you thinking "out of the box." Learning is not just about some brilliant new insight or breakthrough experience. How do you learn, say, team-based product development? The same way you learn to write or to play the piano or to perfect your golf stroke: you practice. You never reach the end. No matter how much you write, play piano, or golf, you're aware how much better you can get. You have to exploit opportunities in people's daily experience to continually enhance their capacities -- which is really all that learning means. To do that, you need a learning infrastructure -- the time and resources to support reflection, practice, and dissemination of ideas and experience. Ford, for instance, created a "car development learning laboratory" for the 1995 Lincoln Continental project, to allow the development team to experiment with new processes and materials and to capture their learning for others. Saturn has a similar learning lab on its manufacturing floor. One of the best diagnostic tools I know for assessing your capacity to learn on the job is to ask yourself, "How do you use your time?" I often find a huge disconnect between what executives say is important and what they spend their time doing. The most effective leaders consciously use their time to develop both a personal learning strategy and a unique leadership style (see the sidebar, "A Strategy for Learning and Leadership.") But most, alas, feel powerless to control their own schedules. As one experienced consultant told me recently, when he confronted a CEO about how he spent his time, the man responded, "Don't you understand? I'm too busy to work on my problems." As a leader, you have to find learning opportunities in your own work as well as others'. For example, how do we find learning opportunities in meetings -- one of the places managers spend (and waste) the most time? Several years ago at the Learning Center we developed a simple tool we called check-ins and check-outs. You start a meeting by everybody taking a minute to check in with what they are thinking. You then take a few minutes to check out -- finding out what people are thinking at the conclusion of a
meeting. Initially the comments may be perfunctory. But over time, as trust and safety develop, people start to share ideas and feelings and to understand each other's concerns, problems, and hopes. Eventually, integrating learning and working means asking tough questions and giving up long-held assumptions. And the more you have to give up, the more your psyche, your attitudes, and beliefs are exposed. People tend to internalize an organization's culture, which for senior managers can mean internalizing a hierarchical culture of compliance rather than an inclusive culture of shared learning. So the people who will have the most difficulty in changing may be the most senior people, for two reasons: they've been around the longest, and they have been selected by the system as exemplars of what the system values. Clearly, there is no simple answer to the question "How do I build a learning organization." But that's just as well. The answers to how-to questions often turn out to be superficial. I believe that the most important questions are the "what" questions: What do we have to do to become more competitive? What do we really want? What do we really believe? Do we really want to distribute power? Do we really believe we have to organize in a different way? And if the answers to those questions are not crystal clear -- if there's any ambivalence -- no amount of effort, expense, or strategizing will make much difference. As people at the front line could tell you in the blink of an eye, there's no substitute for commitment.Asking the Right Questions The best way to learn is to ask questions. Here are a few starters for diagnosing the strengths and weaknesses of your organization.
What are our unifying values? What have we stood for over time? The ability to provide context and meaning for the work people do is key. How do you organize your time? Is it spent on what you say is important? If you want to know if you're really adding value, look at your calendar. Whom do you depend on? Your real work team is those people you count on to do your job -- including support staff, suppliers, customers, direct reports, even regulators. Your performance depends on the quality of those relationships. What are you being paid for? All leaders must understand what results they're accountable for. How well do you practice teamwork, empowerment, service, or whatever values you espouse? Credibility is the No. 1 issue for leaders. By taking an honest look at your own practices -- and asking others to look at them -- you'll know where you stand. How do you convey difficult issues? Learning requires an acceptance, by definition, that one doesn't have all the answers. Your ability to discuss complex problems and develop solutions without making others defensive is a key to learning.
Return to reference
A Strategy for Learning and Leadership
Bill O'Brien, the long-time CEO of Hanover Insurance, had a powerful strategy for combining learning and leadership. O'Brien observed that the calendars of many CEOs are divided into 15to 30-minute increments, and their days may contain 10 to 20 meetings. "If there are issues that can be resolved in 15 minutes," he asked, "why am I spending time on them? Those are exactly the issues that people should be dealing with at more local levels." The solution was to spend less time in brief meetings and more time talking with people about learning organizations, about spirit and shared vision, about understanding interdependencies and business innovation. When he had executive meetings, they typically ran one to two days, to "wrestle, together, with complex, divergent issues that plagued local decision makers." The outputs were often not decisions per se, but "better ways to frame key strategic dilemmas and help people understand short- versus long-term trade offs." After more than 20 years of service, during which time Hanover went from the bottom to the top quartile of the property and liability industry, O'Brien concluded that real organizational transformation is a journey few understand. "Everybody always buys into the ideas," he told me. "After a while you start to wonder, if everybody wants to be part of an organization with shared vision, openness, and continual learning, why is it not the reality?" He concluded that people have no idea of what it takes to lead such an organization. He discovered that to be an effective leader in a true learning organization you have to be willing to "continually give up your most cherished mental models." You need to be willing to give up what's made you effective in the past. Very few of us are. Perhaps the most difficult mental models to give up concern the very nature of executive leadership. O'Brien said it was a big year if he made three decisions -- and two of them were usually personnel-related, decisions that he was the only person in the organization able to make. "It's not about making decisions," says O'Brien. "If do a good job of understanding tough issues and clarifying and disseminating our principles, good decisions can be made throughout the organization."
The Practice of Innovation by Peter M. SengeLeader to Leader, No. 9 Summer 1998
PETER Drucker has elegantly presented the three ingredients Thought Leaders of the discipline of innovation: focus on mission, define Forum: significant results, and do rigorous assessment. But if it sounds Peter M. so simple, why is it so difficult for institutions to innovate? Senge There are two possible explanations, representing dramatically different worldviews. These opposing outlooks were first Peter M. Senge is a clarified nearly 40 years ago by Douglas McGregor in his senior lecturer at the Massachusetts Institute of groundbreaking Human Side of Enterprise: Theory X Technology and chairman (employees as unreliable and uncommitted, chasing a of the Society of paycheck) versus Theory Y (employees as responsible adults Organizational Learning, a global community of wanting to contribute). corporations, researchers, One possibility for difficulties innovating is that most people and consultants dedicated really don't care about innovation. After all, Theory X is still the to personal and prevailing philosophy in most large institutions -- certainly in the institutional development. He is the author of the American corporate world. Few people in positions of authority widely acclaimed The Fifth would admit to that view, but our practices belie our espoused Discipline and, with Charlotte Roberts, Rick values. If we look honestly at how organizations manage Ross, Bryan Smith and Art people, most appear to operate with the belief that people Kleiner, co-author of The cannot work without careful supervision. As Arie de Geus has Fifth Discipline Fieldbook. (6/98) shown in his recent book The Living Company, we treat the business enterprise as a machine for making money rather More on Peter M. Senge than as a living community. Consequently, we view people as This article "human resources" waiting to be employed (or disemployed) to is Chapter the organizations' needs. (The word resource literally means 8 in Leader "standing in reserve, waiting to be used.") to Leader. See the From the Theory X perspective, institutions fail to innovate complete because most people lack the desire to innovate; forget contents. Drucker's theory of innovation. The answer to that problem is From Leader to Leader, simple: find more capable people. But that's a never-ending No. 9 Summer 1998 story. "We don't have the right people" is an excuse that suits all times and all circumstances; it is a refuge for scoundrels. Table of Contents Moreover, it obscures leaders' fundamental task of helping From the people do more together than they could individually. Editors If, on the other hand, we take the Theory Y perspective, that Resources most people come to work (or at least came to work at one time) truly desiring to make a difference, to gain, as Peter Drucker puts it, a "return on their citizenship," then the failure to Additional resources for this article innovate becomes a bigger puzzle. It cannot be laid off on not having the right people. It must have more to do with why Peter Drucker's three core practices are more difficult than meets the eye. It requires that we try to understand how it is that good people, desiring to learn and innovate, can consistently fail to produce what they intend.
Know Your Purpose
E can start by inquiring into what we mean by mission anyway. It is very hard to focus on what you cannot define, and my experience is that there can be some very fuzzy thinking about mission, vision, and values. Most organizations today have mission statements, purpose statements, official visions, and little cards with the organization's values. But precious few of us can say our organization's mission statement has transformed the enterprise. And there has grown an understandable cynicism around lofty ideals that don't match the realities of organizational life. The first obstacle to understanding mission is a problem of language. Many leaders use mission and vision interchangeably, or think that the words -- and the differences between them -- matter little. But words do matter. Language is messy by nature, which is why we must be careful in how we use it. As leaders, after all, we have little else to work with. We typically don't use hammers and saws, heavy equipment, or even computers to do our real work. The essence of leadership -- what we do with 98 percent of our time -- is communication. To master any management practice, we must start by bringing discipline to the domain in which we spend most of our time, the domain of words. The dictionary -- which, unlike the computer, is an essential leadership tool -- contains multiple definitions of the word mission; the most appropriate here is, "purpose, reason for being." Vision, by contrast, is "a picture or image of the future we seek to create," and values articulate how we intend to live as we pursue our mission. Paradoxically, if an organization's mission is truly motivating it is never really achieved. Mission provides an orientation, not a checklist of accomplishments. It defines a direction, not a destination. It tells the members of an organization why they are working together, how they intend to contribute to the world. Without a sense of mission, there is no foundation for establishing why some intended results are more important than others. But, there is a big difference between having a mission statement and being truly mission-based. To be truly mission-based means that key decisions can be referred back to the mission -- our reason for being. It means that people can and should object to management edicts that they do not see as connected to the mission. It means that thinking about and continually clarifying the mission is everybody's job because, as de Geus points out, it expresses the aspirations and fundamental identity of a human community. By contrast, most mission statements are nice ideas that might have some meaning for a few but communicate little to the community as a whole. In most organizations, no one would dream of challenging a management decision on the grounds that it does not serve the mission. In other words, most organizations serve those in power rather than a mission. This also gives some clue as to why being mission-based is so To be mission-based means that those in difficult. It gets to the core of power and authority. It is profoundly positions of authority are radical. It says, in essence, those in positions of authority are not not the source of the source of authority. It says rather, that the source of legitimate authority. power in the organization is its guiding ideas. Remember, "We hold these truths to be self evident..."? The cornerstone of a truly democratic system of governance is not voting or any other particular mechanism. It is the belief that power
ultimately flows from ideas, not people. To be truly mission-based is to be democratic in this way, to make the mission more important than the boss, something that not too many corporations have yet demonstrated an ability to do. While this might appeal to our ideals, living this way is extraordinarily challenging. We are all closet authoritarians. For most of us it is the only system of management we have ever known, starting in school. To be mission-based, and to be values-guided, is to hold up lofty standards against which every person's behavior can be judged. Moreover, mission is inherently fuzzy, abstract. It is so much easier to make decisions based on "the numbers," habit, and unexamined emotions. To be mission-based requires everyone to think continuously. But it can be done, and when done it can work. The largest commercial enterprise in the world, in terms of market value, is not Microsoft, General Electric, or Mashushita. It is VISA International, whose annual volume exceeded $1.25 trillion in 1997. If its different member organizations' balance sheets of VISA products were combined and assessed according to common banking practices, it is estimated that its market value would exceed $333 billion. But VISA is not a typical corporation. It's a network of 20,000 owner-members, who are simultaneously one another's "customers, suppliers, and competitors," in the words of founding CEO Dee Hock. VISA's innovative governance system grew from an extraordinary effort to clarify purpose, which, after several years, emerged as: "to create the world's premier system for the exchange of value." "Truly clarifying purpose and the principles which elaborate our deepest beliefs can be the hardest work you will ever do," says Hock. "But without it, there is no way to create an enterprise that can truly self-organize, where you can balance broadly distributed decision-making function and control at the most local level with coherence and cohesion at any scale up to the global."Define Vision
HE second requirement for innovation -- define results -- is easier in some ways. Managers by nature are pragmatic; ultimately they are concerned about results and must concentrate on how, not just why. The danger is that short-term goals can obscure larger purposes. Here again, language matters. After all, vision -- an image of the future we seek to create -- is synonymous with intended results. As such, vision is a practical tool, not an abstract concept. Visions can be long term or intermediate term. Multiple visions can coexist, capturing complementary facets of what people seek to create and encompassing different time frames. Leaders who lack vision fail to define what they hope to accomplish in terms that can ultimately be assessed. While mission is foundational, it is also insufficient because, by its nature, it is extraordinarily difficult to assess how we are doing by looking only at the mission. For this we need to stick our necks out and articulate "an image of the future we seek to create." Results-oriented leaders, therefore, must have both a mission and a vision. Results mean little without purpose, for a very practical and powerful reason: a mission instills both the passion and the patience for the long journey. While vision inspires passion, many failed ventures are characterized by passion without patience. Passion comes from what you contribute rather Clarity about mission and vision is both an operational and a than what you get. spiritual necessity. Mission provides a guiding star, a long-term
purpose that allows you to balance the inevitable pressures between the short term and the long term. Vision translates mission into truly meaningful intended results -- and guides the allocation of time, energy, and resources. In my experience, it is only through a compelling vision that a deep sense of purpose comes alive. People's passions flow naturally into creating something that truly excites them. Taken together, mission and vision fill a deep need: All human beings have a purpose, a reason for being. Most of us believe that there is something more important than what you can buy, acquire, or market. The passion at the heart of every great undertaking comes from the deep longing of human beings to make a difference, to have an impact. It comes from what you contribute rather than what you get. Now, these ideas might sound good, but if we take a deeper look we realize that they are radical statements in today's society. The return-on-investment orientation -- the view that people go to work primarily for material gain -- is the bedrock of our beliefs about people in contemporary industrial society. Thus, the real discipline of innovation not only threatens established power relations, it also runs counter to our cultural norms. Consider, for example, the saying "People do what they're rewarded for." What management is about in many people's minds is creating the right set of incentives and rewards so people will do what the enterprise needs them to do. As W. Edwards Deming saw clearly, our system of management -- in all organizations -- is based almost totally on extrinsic motivation. It is pure Theory X thinking. It is why, in the last years of his life, Deming said that "our system of management has destroyed our people." This may not be our intent, but it is the consequence of our actions. If we didn't view the human being as an amoeba that does only what it's rewarded to do, then why would we spend so much time worrying about incentives? Just ask people in the organization if they think the senior management really believes that people come to work every day, as Deming said, "seeking joy in work." That's intrinsic motivation, and it's assumed to be in scarce supply in today's management. Joy in work comes from being true to your purpose. It is the source of the passion, patience, and perseverance we need to thrive as individuals and as organizations. However, people cannot define results that relate to their deeper passions unless leaders cultivate an environment in which those passions can be safely articulated. While there are some extraordinarily principled and value-driven organizations, the defining characteristic of far too many enterprises is cynicism. And cynicism comes from disappointment. As the saying goes, "Scratch the shell of any cynic and you'll find a frustrated idealist." Make speeches to your organization about upholding high ideals or contributing to a better world, and most people will roll their eyes (if they're in corporations they'll almost certainly roll their eyes). That reaction is the product of thwarted expectations, and it is the reason so many organizations fail to innovate. They are afraid to let the genie -- passionate purpose -- out of the bottle. With good cause. Passion is a powerful force, but, when frustrated, it is also dangerous.Assess Results
HE third dimension of innovation is assessment. We must continually gauge how we can best use our scarce resources. As managers we all know what assessing is about; it's one of the fundamental activities of all management.
Assessment has two components: measurement and interpretation. The problem is that the second and more difficult component of assessment -- interpretation -- requires understanding, participation, and physical presence. Statistical measures of an activity may be disappointing, but if you're actually involved, you may see that people are engaged and learning. They may be on the brink of a breakthrough. Incomplete or premature assessment destroys learning. As Bill O'Brien, retired CEO of Hanover Insurance, says, "managers are always pulling up the radishes to see how they're growing." Thus assessment is fundamentally about awareness and understanding without which any set of measures can mislead. Someone sitting on the outside judging, rather than fully understanding, can make effective assessment impossible. "I worry about But with awareness comes yet another problem, as Drucker has organizations that cannot fire one person but can pointed out: after assessing results, we must be willing to fire a thousand." abandon what doesn't work. Abandonment often precedes innovation. It clears the decks for trying something new. Again, this sounds so simple. Yet, how many of us have ever found that it is difficult for organizations to abandon what isn't working? To stop doing something that has been done for years ? To remove a person from a position who really does not have credibility with his or her colleagues? "I worry about organizations that cannot fire one person but can fire a thousand," says O'Brien. There are good reasons why abandonment is a challenging organizational practice. The first step in practicing abandonment is openness -- creating an environment in which, at a critical moment, somebody with lots at stake can tell a boss, "This is not working." Building a culture in which people can express their views without fear of reprisal is a huge challenge for most organizations. How often, for instance, have you noticed that when a group of people gets together informally the night before a staff meeting, their conversation bears almost no resemblance to the same group's discussion at the official meeting the next day? How many meetings have you attended where the real meeting takes place not in the conference room but in the hallway or the rest room afterward, when the very people who asked lots of intelligent questions in the meeting say, "What nonsense." Furthermore, when people do feel safe enough to speak openly in a meeting, insiders, those with the most on the line, tend to discount what is said. When, for instance, a junior salesperson, a young woman (or an old one), tells the boss something is not working, you see how quickly an ostensibly open organization can reject unwelcome news. I've never seen an institution that isn't deeply afflicted with these dynamics. Even the best managed corporations in the world fall short of their full potential, mostly because people know that the official meeting is not where the issues are really discussed or decided. The litmus test for measuring openness is simple: How fast does The process of innovation is a process of failure. bad news travel upward? In most organizations good news travels upward faster than the speed of light. But failure is denied before the word can be spoken: "Whose failure? What failure? That wasn't a failure, we just didn't have enough funding." Make no mistake, the process of innovation is a process of failure. By nature, innovation is a continual learning process. You must
experiment, assess, reflect on mission, identify results, experiment some more. Yet from an early age in school, and continuing in work, we have been trained to avoid failure, and thus real learning. Chris Argyris, in his 1991 Harvard Business Review article "Teaching Smart People How to Learn" lays out a basic problem of learning in organizations. He notes that most people in organizations are quite smart, but that to succeed, they've learned to find correct answers and cover up incorrect ones. This undermines the inquiry skills essential to real innovation and leadership because these skills revolve around how to "uncover" what isn't working in ways that do not invoke defensiveness. Consider this true story: A top management team of exceptionally bright, committed people is discussing key issues facing a major American corporation. In three hours, not a single genuine question is asked. Of course, trivial questions get asked, like "Didn't we go over this issue two years ago?" Or, "Don't our experienced salespeople disagree with that view?" Or, "When's lunch?" Each implies that we are wasting our time with the subject, that we already have the answer. Genuine inquiry starts when people ask questions to which they do not have an answer. That is rare in organizations. In most large corporations, people rise to the top because they're very good at a combination of two factors: merit and gamesmanship. In a good organization the mix may be 50/50; in a great one, 80/20. The problem is that even the best leaders -- those who create a terrific impression and get results -- actually know very little. In today's world how could they know much? Obviously, organizations want people at all levels who can produce results. But often the most important act of executive leadership is the ability to ask a question that hasn't been asked before, the ability to inquire, not just dictate or advocate. Unfortunately, most people in executive leadership positions are great at advocacy but poor at inquiry. These are just a few of the issues revolving around effective assessment. This is an extraordinarily complex issue, with complex intellectual issues ("How do we know how long the radishes should take to grow?"), complex emotional issues (Who is not attached to ideas they believe in, many of which are wrong?), complex interpersonal issues ("I didn't want to tell him what I really think because it would hurt his feelings") and complex political issues ("But it is the boss' pet program that is not working and the company has invested millions in it") It is one thing for an organization with Peter Drucker advising it to "abandon practices that are not working." It is another for the rest of us who can only learn from peers. For those reasons, assessment is a core research initiative within the new Society for Organizational Learning (SoL), leading companies, researchers, and consultants working together to advance the state of the art of how organizations learn. We are coming to believe that there is a big difference between "assessment for learning" and "assessment for evaluation." Because most of the assessment we have encountered in our lives was the latter, the very word tends to invoke defensiveness. But no learning can take place without continuous assessment. The key is that the assessment is done by the learners and the purpose is to learn, that is, to enhance capacity to produce intended outcomes, not to judge someone else.From Habit to Discipline
AKEN together, mission, vision, and assessment create an ecology, a set of fundamental relationships forming the bedrock of real leadership. These tools allow people, regardless of job title, to help shape their future. The failure of Industrial Age institutions to embrace the three components of innovation shows how far there is to go to meet the challenge of the next century. Moreover, Drucker is exactly right that innovation is a "discipline," a word having its root in the Latin disciplina, one of the oldest words for "to learn." Many have talent but real learning requires discipline, the process through which we draw out our potential through commitment, practice, passion, patience, and perseverance. It is a difficult process, but there is reason for hope. The discipline of innovation is practiced successfully in many domains of human affairs, notably the arts and science. Interestingly, when it is practiced effectively it is invariably done so within communities, among diverse individuals who share a common purpose. Energized communities, for example, characterize most periods of innovation in the arts, such as the birth of impressionism, or modern dance, or jazz. Likewise, science at its best is an intensely collaborative undertaking; even when the "collaborators" are strong individuals competing with one another, their competition occurs within a larger mediating community. Likewise in business, real innovation is often much more collaborative than at first appears. For example, studies such as those by MIT's Eric von Hippel have shown that many of the best new product innovations come from customers. The problem is that most companies are not organized to tap this source of innovative thinking. My guess is that mastering the discipline of innovation will require organizations working together, learning from one another's efforts. We must learn to do what artists have done for millennia, what scientists do when science works. To do something new, people invariably experience periods of profound discomfort. Confronting the threat and uncertainty such change brings is best done together, not in isolation. Several years ago, at one of our early SoL community meetings (then called the MIT Organizational Learning Center), a manager approached me and said, "I see exactly what you're talking about, all these organizations learning from one another. This is Alcoholics Anonymous for Managers." I laughed, but I think he hit the nail on the head. We are all addicted to maintaining control, to avoiding failure, to doing things the way we always have. We can't help it. And we need one another to break the habit.