MIT Sloan Management Review

This matrix helps frame discussions of how to monetize data. Start by considering whether your organization wants to use data for improving, wrapping, or selling (as shown on the horizontal axis). Then discuss where in the value creation process you will participate: by offering data, insight, or action (as shown on the vertical axis). The first example shows an improving/data decision, the second a wrapping/insight choice, and the third a selling/action approach. Note that your company could pursue one type of product, three in a row — or even products for every single matrix square. The key is for your team to understand the implications of each choice. https://mitsmr.com/3RwJMQp

This framework is designed to help organizations focus their resilience investments on building long-term supply chain robustness. The figure above illustrates how our approach compares with existing methods for valuing resilience investments. Best-guess calculations rely on a single value obtained simply by multiplying the potential impact by the probability of the event. A company generating a profit of $10 million exposed to a 2% chance of a total loss will conclude that a disruption would cost $200,000 and would be willing to invest up to that amount to mitigate the loss. However, this approach only approximates the likelihood of a disruption and its potential loss. Its utility for assessing low-probability, high-impact events is limited. It yields an average exposure to risk for a single point in time — a useful measure for insurance companies, but not for firms looking to make effective investments in resilience. Value-at-risk methods take a more analytical approach but still give little guidance about when and how much to invest in resilience. They expand on classical supply chain models designed to maximize the return on assets or minimize total supply chain costs but, like best-guess methods, can obscure events that have a low probability yet are plausible. This may lead managers to focus on an event’s probability more than its disruptive consequences. In particular, value-at-risk methods aren’t helpful in recognizing the upside value of actions that increase resilience. While they can quantify vulnerabilities in the supply chain, they do not provide guidance for when and how much to invest in resilience and fail to give managers the tools to justify resilience investments. This shortcoming can amplify the boom-and-bust cycle by focusing investments on the obvious risks following an event and allowing them to quickly fall off as memory of the event fades. https://mitsmr.com/4fIyRwI

Vaccine developers certainly had strong motivations for joining COVAX. We heard from various stakeholders that there was genuine altruism on the part of some participants. Some companies and their respective leaders wanted to do the right thing. There were also more instrumental considerations. COVAX provided access to extra funding for vaccine development — COVID-19 vaccines were not yet developed when some corporate leaders directed their companies to join — and a route to market through the UNICEF distribution pipeline if the vaccines were successfully developed (and secured WHO emergency use approval). COVAX also offered reduced liability exposure. Another significant factor evident in our media analysis as well as our interview data was the pressure from external stakeholders and company leaders looking to protect their public image as responsible corporate citizens. https://mitsmr.com/3AZ6TNc

Product management is one of the fastest-growing roles in business, having gained increased scope and importance in Silicon Valley. While product managers used to be hired almost exclusively by technology companies, they are now being recruited in growing numbers by service-oriented businesses as well, with firms such as Accenture, Chase, JPMorgan, Optum, and Vanguard adding product management functions in the past few years. Why are services companies looking to add product capabilities to their organizations? Professional services firms, which span a wide range of sectors, including IT, legal, marketing, and tax and accounting services, face two major growth challenges. Owing to the significant human involvement in service delivery, their gross margins are low, and their head counts scale linearly with increases in revenue. Product companies enjoy much higher growth margins and revenue per employee. This explains why startups that offer software-as-a-service products are valued at six to eight times their annual revenues, whereas startups that offer project-based services are valued at one to two times their annual revenues. Recognizing the challenges of margins and scalability, professional services firms are trying to evolve into product-like companies by productizing their services. This involves automating, standardizing, and packaging aspects of a service into a tangible, repeatable, and scalable offering that is efficient to produce and easier to scale. https://mitsmr.com/3Tco7x5

CEOs rarely work alone: A capable senior management team is essential for their success. However, new CEOs often face challenges with disorganized top leadership teams, hindering the organization's progress rather than propelling it forward. As a result, one of their initial and crucial tasks is to establish a functional team. During our interviews, we encountered accomplished CEOs who have taken diverse approaches in balancing these two principles. The key lies in finding the appropriate equilibrium for the company and its specific circumstances, and then selecting and aligning the leadership team accordingly. Our research indicates that new CEOs who excel in forming strong leadership teams typically prioritize a similar set of crucial activities. These include defining a strategic vision, determining the need for a competitive or collaborative team dynamic based on the context, handpicking team members, and motivating them to work together by establishing norms and expectations. In the following sections, we will delve into each of these aspects in depth. https://mitsmr.com/3zcpBQZ

Here are some things I bet you can’t say at work, no matter how much you believe them and how much they affect your own motivation, engagement, or ability to make good strategic decisions: ?? “I’m not motivated to work harder or innovate when you and your bosses get most of the credit and all the bonus money.” ??“Employee engagement is low because key leaders aren’t trusted or respected and nothing serious gets done about that.” ??“I can’t make good decisions unless you and your bosses are more transparent with financial or strategic details.” ??“I think we’re growing and making enough money right now.” Similarly, if you’re a senior leader, I bet you’d have a hard time responding productively if you did hear any of the above — because you’d be so surprised anyone said that to you. Why is this? Because these kinds of comments violate what I call the deep rules operating in most organizations. Deep rules reflect the unwritten understanding of what can’t be said, even in places that have surface-level psychological safety. This form of hidden power undermines well-being for most people and, in many cases, ultimately undermines even the leaders who seemingly benefit. What can you do to change the situation at your organization? To start, people with more power must take the lead on change. Expecting people below you to stick their necks further out isn’t just unfair. It’s unrealistic. People might not like the deep rules they experience, but most don’t feel anywhere near safe or emboldened enough to start challenging them. Here are some conversational prompt techniques I recommend in my work. Leaders have told me that these approaches have led to surprisingly frank and highly valuable conversations with colleagues about issues that both sides agreed should be started, stopped, or fixed. https://mitsmr.com/487AfWc

Recently, several high-profile U.S. organizations have backtracked on diversity, equity, and inclusion (DEI) commitments. Rural chain store Tractor Supply said it would eliminate DEI roles and goals, and farm equipment company John Deere said it would no longer sponsor social or cultural awareness events. Their reversals were joined by what might seem like an unlikely ally: the Society for Human Resource Management, which in July announced that it would drop the term equity from its initiatives toward fairer workforces to focus instead on just diversity and inclusion. I’m not a trained HR professional, nor a SHRM member, but I’ve talked to enough of them to know that SHRM’s decision caused an uproar. SHRM CEO Johnny Taylor tried to explain the decision by telling Axios in an interview, “We can’t come in and have a legitimate conversation with senior management when people are debating [what the ‘e’ means].” But HR professionals I know are not having this debate. They understand that equity isn’t equality. They know we’re talking about equal access to opportunity, not trying to solve all of society’s issues. What’s going on here? Loud voices are talking about workplace fairness issues, and they’re getting it all wrong. They’re pushing for a retreat, acting as a voice for all, when a majority of Americans support DEI and want a rational conversation about the benefits of inclusion. Organizations’ retreat in the face of activist social media criticism and other judgmental voices at the table might do more harm than good when it comes to a critical set of stakeholders: their employees. Recent research, and my own experience dealing with team performance issues rooted in diversity, show that companies feeling the heat for their DEI efforts would be smart to slow down and focus on two things. https://mitsmr.com/3O3mQ8B

Enriched with AI, smart KPIs offer several advantages over traditional KPIs. https://mitsmr.com/3PqRSsi

When should a #leader be pulled into a decision, and when can team members move autonomously? Identifying decisions as low risk or high risk and low urgency or high urgency helps to clarify expectations: https://mitsmr.com/3OKfBS6

"We have identified seven elements of adaptive culture that we consistently see in businesses that have transformed successfully." Read on → https://mitsmr.com/3CAUnj9