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Elon Musk – Leading a quest to save the future

Elon Musk – Leading a quest to save the future

47 year old South African born entrepreneur Elon Musk founded X.Com in 1999. X.Com later became Paypal and was sold to Ebay in 2002. After making a cool $165 million out of the deal, Musk turned his focus to new and more ambitious ventures. First he founded Space X, a company designing and manufacturing spacecraft with goals to commercialise space travel and colonise Mars. Then in 2003, he commenced Tesla Motors and started producing zero emission electric sports cars. More recently, Musk convinced Tesla shareholders to acquire his third passion project, Solar City; a business owned by Musk’s cousin, specialising in powering homes, businesses and eventually cities with solar power.1

Elon Musk - Leading a quest to save the future

The lure of a strong vision

Musk wraps all of his companies up in a larger than life vision that attracts and inspires his employees.2 At Tesla Group, people genuinely believe they are saving the planet. At SpaceX, they are on a crusade to give humans a second chance on another planet if earth gets into trouble.3

Musk intimately understands the heady attraction of such ambitious work for highly skilled people. When releasing his electric car patents to the world, Musk openly taunted his competitors: “My vision allows me to hire and retain better people than you will ever be able to hire for any amount of money. They will be smarter, they will work harder and they will stay longer.3

I wrote about the positive effect of workers feeling a higher sense of purpose in my blog ‘Work and Happiness’.

Selecting the best talent

Musk has a reputation for hiring only the best people on the planet to work for him – whether to build a rocket or cook in the cafeteria.4 He believes that bringing on a few leading minds in the field and giving them the freedom to accomplish their responsibilities is better than hiring a lot of people to get a complicated job done. According to Musk, numbers just slow down progress and make a task more expensive to complete.

Apart from wanting the best, Musk also values a positive attitude and an easy to get along with personality. (Watch ‘Elon Musk talks Talent vs. Personality in Employees’).

Musk personally interviewed the first 1000 staff for Space X and even today still interviews every engineer. However, he encountered unique challenges sourcing talent along the way. In particular, it was difficult to entice experienced people away from established aerospace players like Boeing and Airbus. So he went after younger talent; personally scouring PhD programs from a range of universities for individuals who had built something, or had been on a team that had made something from nothing.2

At Tesla, the experience was a little different. Cars hadn’t been done in Silicon Valley before so there were a number of software engineers excited about the prospect of applying their skills to an entirely new product. Tesla also had the backing of a Silicon Valley legend – Google Founder Sergey Brin – to boost the project’s appeal and the credibility of the Tesla brand amongst target applicants. Once again, Musk stayed close to the recruitment of talent,2 even taking to Twitter himself to advertise for engineers for the autonomous vehicle division.5

Recruitment techniques

Musk makes applicants write essays about why they want the role. He also gives them a riddle to solve to test critical thinking. In the interview, Musk is known to play mind games; he barely pays attention to candidates and sits with his back to them2 before spinning around to drill them with questions.6

Musk is a proponent of behavioural interviewing techniques. Unless a prospective employee can break down the solution to a problem in granular detail, he will conclude that they do not really know the answer or have embellished the level of their involvement.6

Intense culture

Job ads on the Tesla careers website come with a warning: “These jobs are not for everyone, you must have a genuine passion for producing the best vehicles in the world. Without passion, you will find what we’re trying to do too difficult.”6

According to Dolly Singh, former Head of Talent Acquisition at Space X, working with Musk is not a comfortable experience as he is never satisfied. He pushes his team so hard they sometimes feel like they are “staring into the abyss”. However, this pressure on performance is deliberate. Musk knows that his staff will exceed even their own expectations if he keeps the heat on.7

And, as Singh points out, “you don’t get to Mars with a bunch of softies.”

Musk describes himself as a nano-manager. Even more intense than a micro-manager, he maintains a hands-on obsession with the tiniest operational and design details.1 And when there is a pressing problem preventing progress, Elon will devote the majority of his time and energy to it.2

Structure and communication

The Musk businesses run on flat structures. Staff are free to contact anyone directly, including Elon.2

At Space X, the engineers (including Musk) physically sit on the manufacturing floor in giant glass cubicles. They have to walk through the floor to get to their office so are forced to look at everything going on and interact with staff.2

Is Musk a modern day superhero?

Musk has been described as a modern day Howard Hughes and even compared to comic book hero Iron Man (aka Tony Stark). There is no doubt he is a physics genius. And, if popular media reports are to be believed, has a penchant for fast cars and beautiful women. However, Musk knows that to achieve his ultimate goal of saving the planet and establishing interplanetary colonisation, it will take a team of superheros. To this end, his approach is quite simple: seek out people who are as talented and driven as he is; ensure that the work environment is as motivating and meaningful as possible; and, establish clear and measurable objectives. Sounds easy, right?

Works Cited

  1. Wartzman, Rick. “Admire Elon Musk All You Want, but Please Don’t Manage like Him.” Fortune.com. Fortune, 21 Jan. 2015. Web. 21 May 2017.
  2. “How Elon Musk Builds Organizations That Can Achieve Anything – Recruiting & Training, Remaking R&D, Setting Strategy.” Innovation Leader. 13 Feb. 2017. Web. 21 May 2017.
  3. Lavoie, Andre. “Want to Hire the Best Talent? Be Like Elon Musk and Set a Strong Vision.” Entrepreneur. 22 July 2014. Web. 21 May 2017.
  4. Carson, Biz. “Elon Musk Is so Obsessed with Hiring, He Even Poached the Best Yogurt Shop Employee from Pinkberry.” Business Insider Australia. 02 June 2015. Web. 21 May 2017.
  5. Burns, Matt. “Want To Work For Tesla? Elon Musk Turns To Twitter To Recruit Engineers.” TechCrunch. TechCrunch, 19 Nov. 2015. Web. 21 May 2017.
  6. Tovey, Alan. “Elon Musk: Have You Got the Drive to Work for Tesla?” The Telegraph. Telegraph Media Group, 20 Nov. 2015. Web. 21 May 2017.
  7. Feloni, Richard. “A Former SpaceX Employee Explained What It’s Like To Work For Elon Musk.” Business Insider Australia. 24 June 2014. Web. 21 May 2017.

Elon Musk image By Steve Jurvetson [CC BY 2.0 (http://creativecommons.org/licenses/by/2.0)], via Wikimedia Commons

New research into performance management in public organisations

Impact of Performance Management
In my last article, I gave a run-down of three talent management trends that I thought would be particularly influential in the new year. Though I briefly summed up my thoughts on each one, I’d now like to go in-depth on performance management (PM).

Across public, private, and government sectors, elite organisations share a common understanding: performance management is what fosters employee excellence. It’s what makes a good organisation into a great organisation.

So, needless to say, I think it’s worth doing a deep-dive when it comes to the study of performance management. Which is where an important article, “The Impact of Performance Management on Performance in Public Organisations: A Meta-Analysis,” comes in. Published in the Public Administration Review by Ed Gerrish, Ph.D., it offers us some valuable insights into separating the wheat from the chaff when it comes to maximising effectiveness of PM processes.

Dr. Gerrish saved us a lot of reading by reviewing 49 studies of performance management and synthesising the results with what’s known as a “meta-analysis.” His findings are conclusive and critical to any successful organisation: the efficacy of PM is entirely dependent on the system used to institute it.

Impact of PM in Public Organisations statistics

Keys to success in performance management

1. Simply measuring isn’t enough

Don’t just measure performance. Treat your data as actionable intelligence. We’ve all been involved with stagnated organisations that simply “go through the motions.” They usually don’t last very long. In the case of PM, this might mean tracking performance, but only taking superficial measures to correct problems. That’s not going to cut it. Measuring performance without managing performance has a negligible effect.

Performance measurement works best when integrated with best practices and strong organisational culture. Important steps include clear – and clearly stated – goals, using performance data as a basis for strategic planning, and incentivising strong performance. Gerrish’s meta-analysis shows just how important best practices are when it comes to PM: organisations tying those best practices into PM are up to three times more effective than “average” PM systems.

2. Benchmark your way to success

One technique that the analysis shows to be quite effective is benchmarking – comparing performance to industry leaders and ensuring year-over-year improvement. I’ve long been a believer in benchmarking, and have seen employees, teams, or entire departments re-energised when given a clearly stated goal. It’s also a clear way to identify both high-performers and underachievers – a logical starting point in performance management.

With an appropriate frame of reference, outstanding employees can be properly acknowledged and rewarded and under-performers can be correctively trained to improve their performance. On a larger scale, departmental budgets or autonomy can be tied directly to clear benchmarks so that teams know exactly what is expected of them.

One example of where benchmarking works as a determinant of budgeting is in local government. A comprehensive study of over 300 county and city governments in the US found that the “greatest applicability” of PM through benchmarking is during budget development.

3. Survival of the fittest PM

Organizations are subject to the same Darwinian laws as living organisms. As a result, they are constantly adapting to survive and thrive in their environment. Performance management systems are one of the most important tools an organization can use to survive change. This is why “Second-generation” PM systems, defined by Gerrish as those which have been in place for longer than two years and are significantly different from their first-generation predecessor, can make or break an organization.

The most effective second-generation PM systems are those that do more than pick low-hanging fruits. A key to success is thinking proactively. It’s easier to build a fireproof house than put out a fire. For instance, if an organization recognizes that a department is underperforming, it’s not enough to cut funding. A first gen PM system might recognize a problem. That’s good. But a second gen PM system should both recognize, react to, and safeguard against future problems.

Xerox, the American copier manufacturer, saw its stock plummet from $70 to $5 a share within 18 months at the turn of the century. Looking overseas at Japanese competitors, Xerox found that their product took twice as long to produce and at three times the cost. With the help of an outside consulting firm, Xerox was able to make real structural changes that have sustained them in the 21st century like just-in-time inventory, quality control improvements, and emphasis on leadership training.

Using PM systems and benchmarking, Xerox identified the areas they were failing in. As an established firm, Xerox certainly had second gen PM systems. These systems were then used as a launching point to react to shortcomings and make strategic decisions that would prevent the organization from repeating its mistakes.

The right way to manage performance

Be mindful of the following steps to keep your organisation on track:

  • Remember that measuring is only the first step – there’s no benefit to gathering data if it doesn’t lead to action. A strong management team will use performance measurement to start moving in the right direction. Your stakeholders want results, not a case study.
  • Put everyone on the same page with benchmarking – it’s easier to communicate when everyone is speaking the same language and understands where they stand in comparison to their peers. Differentiate high- and low-performers and make corrections accordingly.
  • Be aware that PM systems change with time – identify ways that your second-generation PM system is different. Did you make necessary and proactive changes or just react to immediate problems by picking low-hanging fruit?
  • Step outside of your organisation for a new perspective – there’s more than one way to skin a cat. Oftentimes solutions can come from an entirely different field or industry. Don’t fall into the trap of “this is how we do it because this is how we’ve always done it.”

If you’re a leader hoping to spur change in your organisation measuring and benchmarking can be effective tools, but they’re powerless until you’re ready to follow them up with necessary heavy lifting. Put data to work for you, don’t be afraid to see how you stack up to the competition, and don’t be reactive. Be proactive.

Performance Management can be hard without systems and experience.  Let us help.

Mastering Performance Conversations with Highly Sensitive People

You might not have heard of the term ‘Highly Sensitive Person’ before, but I’m willing to bet it conjures up a face or two. According to Dr Elaine Aron, who coined the phrase back in the 1990s, nearly 20% of us fall within this bracket1. Which means most offices have at least one hypersensitive person.

Creative, with a high attention to detail that often equates to exceptional performance, highly sensitive people can be incredibly useful. At the other end of the scale are less productive behaviours, traits many leaders struggle to manage – especially when it comes to feedback and performance conversations.

Highly sensitive people

Hypersensitive people are especially receptive to social, emotional and physical stimuli. This group typically become overwhelmed during busy periods, don’t respond well to sudden changes, worry excessively and display emotional behaviours less sensitive people may consider extreme. These reactions make addressing shortfalls in performance problematic, which is why leaders must learn how to deliver constructive feedback to hypersensitive individuals.

Acknowledge Social Bias

The reactions of highly sensitive people are often considered inappropriate in the modern workplace. Excessive displays of emotion can be viewed negatively, while a tendency to become flustered under pressure, avoidance of stressful situations and an inability to cope with changing demands are often viewed as incompetencies.

When preparing for a discussion with a hypersensitive person, acknowledge your bias towards their behaviour. Does their emotional reaction make you uncomfortable? Are you exasperated by particular reactions? Hypersensitives are very aware of body language and tone, understanding your response and staying objective is essential for keeping any conversation on track and avoiding misunderstandings.

Adopt Agile Performance Management

Frequent readers will know, I’m a big advocate of Agile Performance Management (APM). Regular feedback means this system delivers tangible benefits to productivity and engagement.

For highly sensitive people, it also offers a raft of other advantages. These guys actively avoid situations that make them feel uncomfortable, and an annual performance review could mean weeks of stress and worry.

Adopting Agile Performance Management

By meeting regularly for informal one-to-ones, leaders create a less intimidating environment. Setting goals and keeping the conversation forward-focused puts less emphasis on feedback that could be construed as criticism and reduces the chance of an overly emotional or defensive reaction.

Plan Ahead

Potentially inflammatory conversations with highly sensitive people can be avoided with forward planning. Schedule any meeting well in advance. This allows you to reduce the threat of the situation as much as possible and gives a sensitive individual the chance to prepare (a valuable coping mechanism for many hypersensitives).

Avoid Confrontation

Highly sensitive individuals have strong emotional reactions2 and can become defensive when criticised (or when faced with perceived criticism)3. Using empathy in your statements and speaking in a low voice can go a long way to avoiding confrontation4. Remember, a feedback conversation is not a trial. Don’t go over evidence or allow for counter arguments. Simply state the feedback relating to a specific expectation and focus on strategies for success in the future.

Take Control of the Conversation

Every performance discussion should focus on moving forward and the necessary actions needed to achieve success. For highly sensitive people, who are typically very invested in their work, this reduces the threat of criticism and keeps them motivated.

If you find yourself drawn into a disagreement, then be mindful of your reactions. Hypersensitives are quick to pick up on body language. Listen calmly, keep your voice low and avoid ambiguous language, or statements that can be misinterpreted, as much as you can. If you can’t get a highly sensitive person to agree to your feedback, get their agreement on the outcome and future goals instead.

Keeping calm

To sum up…

While managing hypersensitive people often requires more thought and consideration from leaders, it is important to note that these individuals should always be held to the same standards as their colleagues. Failing to address performance issues for fear of causing a scene or upsetting one individual will have a negative impact on engagement and productivity throughout their team.

A highly sensitive person who is unable to meet expectations or consistently performs poorly must be managed appropriately, and should not remain in a position they are unsuitable for purely because they are hypersensitive.

What are your experiences with hypersensitivity in the workplace? I’d love to hear your thoughts on managing this unique group.

References

1Ramsay, 2014. Highly sensitive people in the workplace: from shame to fame. HRZone
2Lawrence, 2013. Are you a highly sensitive person. HRZone.
3Aron, 2007. A meditation for HSP on criticism: the killer. Elaine Aron.
4Thibodeaux, Not dated. How to deal with an overly sensitive person in the workplace. Small Business.

Level-Up Your Leadership Knowledge: Performance Metrics Masterclass

Terms such as KRA, KPI and OKR are thrown around pretty frequently in the business world. Many organisations use them as measures of success; basing bonus, promotion or grades of pay on the progress (or lack of) that staff make towards these goals. But what is the best set of performance metrics designed to unify the workforce and drive your organisation forward?

We need to understand exactly what these measurement approaches can achieve if we’re going to use them as more than just workforce yardsticks.

KRA, KPI and OKR

Key Result Area (KRA)

These are critical success factors: actions that are necessary to achieve a specific objective. Ideally, everyone within an organisation is assigned KRAs specific to their team, department or other workgroup, so they know exactly which actions they must take to realise strategic goals and ensure future success.

Advantages

Teams that use KRAs have been shown to be proactive, rather than reactive, simply because they make a point of consciously identifying the areas where their efforts make a difference long-term.

By defining expectations and providing clarity, employees know exactly why they’re there and what they’re doing. Individuals understand why some KRAs take precedence over others and have the knowledge to effectively prioritise their workload.

In fact, the KRA-centric appraisal system of Simbawli Sugar Ltd., one of the biggest mills in Northern India, has had a significant influence on employee engagement (an issue I tackled a little closer to home in this post). Senior staff credit the KRA approach with focusing employees on outcomes, improving competencies and increasing accountability.

Disadvantages

There are a couple of downsides to KRAs, namely finding metrics that are easy to measure. Setting individuals objectives also poses a problem, since it only captures around 80% of a department’s workload (the rest falls in areas of shared responsibility).

When would you use it?

This system works well for organisations with multi-skilled teams and high numbers of experienced staff. Everyone understands the vision and their role in achieving it, so using KRAs negates the need for micromanagement and daily check-ins.

Objectives and Key Results (OKR)

Objectives and key results are a favourite of the tech industry (see my recent performance management post). They were designed to challenge individuals and are comprised of one objective and multiple quantifiable key result measures. Progress indicators for these measures are scaled by either 0-1 or 0-100% and are regularly updated. A good OKR should be pretty hard to nail, so they’re considered complete when progress exceeds 75% or 0.75. If you hit 100%, your OKRs are far too easy.

Objectives and KRAs

Advantages

Google loves this one; Rick Klau even credits it with helping to keep the company on track and moving forward. That’s because OKRs provide clarity, every person in the organisation knows what is expected of them and why, and everyone’s OKRs work together to drive the business forward.

The defining factor about OKRs is that they are transparent. Employees can see what colleagues are working on, their progress on current targets and how well they performed previously. This is also true at Google, where even Larry Page’s objectives and progress are available for all to see.

They’re also pretty adaptable. Google sets an annual flexible OKR supported by quarterly objectives that are set-in-stone. Of course, you can opt for biannual or monthly targets: it’s really about what works for your business.

Disadvantages

The main disadvantage of OKRs lies with managers, specifically their goal-setting ability (if you’re not sure exactly how to set worthwhile, actionable goals, take a look at the Cognology guide to writing SMART objectives).

When it comes to OKRs, managers must have a realistic understanding of employees’ roles, skills, and resources. Otherwise they risk setting unachievable goals that demoralise their workforce.

In contrast, the ‘nice guys’ set a couple of easy and one difficult objective because they don’t like to see employees scoring 0.6 (remember, OKRs are meant to be challenging. Google sets targets of 0.6-0.7).

When would you use it?

OKRs are particularly well suited to start-ups and those operating in capricious markets. Quarterly or bimonthly objectives provide staff with a sense of purpose and direction but are flexible enough to adapt to a changeable long-term vision.

Key Performance Indicators (KPIs)

KPIs are probably the best known performance metric. Of course they vary between companies and industries, but KPIs are frequently used to analyse factors that are crucial to the success of an organisation. They exist at both operational and staff appraisal levels, with employee KPIs supporting operational KPIs.

Used to help manage both KRAs and OKRs, employee KPIs measure of primary responsibilities. Consisting of a timeframe, a target, and a benchmark, KPIs focus on results, opposed to activities. They are milestones designed to help individuals, and their managers, gauge whether their performance is on track.

Advantages

Like all appraisal systems, KPIs allow organisations to measure progress towards a strategic goal. They require discussion on how they will be measured before they’re converted into a benchmark, so are more likely to be realistic and attainable than OKRs.

Unlike KRAs, they can be team-wide, with whole departments monitoring and addressing issues associated with the success rate of an indicator. They’re also great for turning prospects into clients since the metrics tend to go hand-in-hand with performance data and often provide actionable insight.

Pfizer, a pharmaceutical Goliath, relies heavily on KPIs at both an operational and corporate level. And it makes good use of them when it comes to boosting brand trust, publicising KPIs of public concern, such as carbon emissions.

Disadvantages

No matter how you tackle it, measuring KPIs can be a time-consuming process. Pfizer might love them for the insight they offer when it comes to identifying strengths and weaknesses in its global empire, but those insights come at the cost of data collection and analysis, internal audits, facility self-assessments, and management system reviews.

Which leads us to the next point: KPIs can be expensive. They’re also pretty limited since they are restricted to variables that can be measured (employee engagement, for example, is difficult to quantify). Plus they’re inflexible – changing a KPI can potentially mean disregarding years of comparative data.

When would you use it?

KPIs are an excellent way to measure performance and profitability metrics. They work particularly well in organisations that have multiple uses for performance data and can justify the time and expense of monitoring it.

In conclusion…

These appraisal systems each ensure employees are working towards a common goal; the best even include individuals in the attainment of that goal. Each has weaknesses, but they are not insurmountable – it’s all about what works best for your organization. Choosing the correct performance management system requires a keen vision, long term goals and an understanding of the resources and skills available to your staff.