CEO Glenn Engler, host of the Market Edge podcast, talks about Leadership in the Digital Age with Rosabeth Moss Kanter, Harvard Business School Professor and author of Supercorp, a look at how a new generation of values-driven businesses do well by doing good.
Listen to Glenn’s discussion with Rosabeth Moss Kanter, first aired on WebmasterRadio.fm on July 10, 2012.
Connect with Glenn Engler on Twitter @GlennEngler or on his blog, “Random Patterns of Thoughts“ at GlennEngler.com.
Connect with Rosabeth Moss Kanter on Twitter @RosabethKanter or on her Harvard Business Review blog.
Transcription of Complete Interview:
Please note: the below text is a transcript of a live feed so it may not be perfect word-for-word. As an alternative to the text, you can tune in to the audio version of Glenn’s discussion with Rosabeth Moss Kanter!
Glenn E: Hi, and welcome to Market Edge. I’m your host Glenn Engler, CEO of Digital Influence Group, a full-service digital marketing agency that helps companies unlock the social potential of their brands and amplify its impact to drive business results.
Today, I’ll be talking about leadership in the digital age with Rosabeth Moss Kanter, Harvard Business School professor and author of SuperCorp, a look at how new generation of values-driven businesses do well by doing good. Rosabeth Moss Kanter holds the Ernest L. Arbuckle Professorship at Harvard Business School where she specializes in strategy, innovation, and leadership for change. Her strategic and practical insights have guided leaders of large and small organizations worldwide for over 25 years through teaching, writing, and direct consultation to major corporations and governments.
The former editor of Harvard Business Review, Professor Kanter has been repeatedly named to list of the 50 most powerful women in the world and the 50 most influential business thinkers in the world. In 2001, she received the ‘Academy of Management’s Distinguished Career Award’ for her contributions to management knowledge. In 2002, she was named ‘Intelligent Community Visionary of the Year’ by the World Teleport Association, and in 2010, she received the ‘International Leadership Award’ from the Association of Leadership Professionals.
Professor Kanter has authored or co-authored 18 books. Her latest book ‘SuperCorp: How Vanguard Companies Create Innovation, Profits, Growth, and Social Good’, a manifesto for leadership of sustainable enterprises, was named one of the 10 best business books of 2009 by Amazon.com. You can connect with Rosabeth on Twitter at Twitter.com/RosabethKanter. That’s K-A-N-T-E-R.
It’s an honor to have you on Market Edge, Rosabeth. Welcome.
Rosabeth MK: Thank you, my pleasure.
Glenn E: Let’s start off and if you can tell us a little bit about your professional journey and what led you to Harvard Business School.
Rosabeth MK: In many ways, I’ve been doing something, the same thing my whole career. I really care about effective organizations that can make a difference in the world, how we create positive outcomes for society, for the people who work in companies, for the customers, for communities. I’ve had that preoccupation all of my life and I always knew that business was an arena that had enormous power over the lives of people. In fact, during my career, I’ve watched the interests in business grow.
First of all, for many people, business was essential to have employment and also products and services. There were others who were critics of business processes. Increasingly, the public would like business to be a source of solutions because there’s also great distrust in America and in other parts of the world. In government, big government is having difficulty meeting its obligations, so vendors have turned to the private sector. I knew this was an arena for action where we can shape people’s lives and do it either for good or sometimes the effects are not so benign.
My mission is to make sure that the effects are good for people, for society, and also, of course, to sustain business. Business has to earn a profit. How one combines all of those factors and creates strategies for companies but also leaders who are able to keep in mind the needs of all of their constituencies, of everybody to whom they’re responsible, and steer an enterprise in a positive direction.
Just one more quick comment that while watching today, a lot of formerly very well respected CEOs stumble in one way or another. That’s not only has consequences in terms of whatever actions they did that were wrong, and whatever happens to their personal lives, some are indicted and are going to go to jail. Also, they had a responsibility to their enterprise. Once you’re a leader, you have a responsibility to other people. It’s not just whether you’re performing your job well or you’re getting bottom line results, and so it really bothers me if people sometimes don’t see the responsibilities that go along with the privilege of a position.
Glenn E: Speaking of privilege, I’ve had the privilege of knowing you for a while and watching how many millions of things that you’re involved in, so I have to ask for inquiring minds. Describe a day in the life of Rosabeth Moss Kanter.
Rosabeth MK: Let’s see. Do we pick a day? Beautiful July, say, on Martha’s Vineyard, out there with the water and doing practically nothing, thinking. You need thinking time and sometimes due to the pressure of work, I don’t have enough time for that. That would be a wonderful day in the life. I love those days. Those days are sustaining when flying around on airplanes.
I guess, I don’t know if there’s a typical day. One of the things I love about what I do is the chance to get involved in a lot of things, and in many ways, everyday is different. When I’m in the classroom, I teach a very, very large set of MBAs. Those days, I’m spending my time preparing and interacting with the students and that’s wonderful, and I may also have conference calls and meetings. I walk to work. I also have another privilege in my life. For people listening to this, that’s an incredible privilege. It’s healthy to be able to walk and to be close enough to things and build in those moments, those are also reflection moments. Sometimes, I pull out my BlackBerry and, yes, I realize I may be the last living BlackBerry user soon.
I actually had the CEO of a very, very large and distinguished telecom company, I won’t mention, former CEO and current CEO in an MBA class and I told the students that they had to be really, really good that day because that way maybe they keep on supporting my BlackBerry. Then the former CEO said, “Not a chance.” I sometimes do that while walking and having to keep things moving on many different things. Some days, I can concentrate on writing. I tend to do writing email early in the morning, clear that out as much as possible, and then I’m seeing lots of people. I’m on airplanes a lot going places and friends of mine joked, they say, “Oh, you’re going to Australia. Are you going for lunch?” and I’ll say yes. Don’t necessarily … because I’ve been a tourist in many places. I love seeing it and sometimes I can go and stay, and sometimes I go and do what I’m doing and have a good time doing it and come right back because I also want to be home or there’re other obligations.
Again, I feel very fortunate to have a life with so many opportunities. I would say the hardest thing is covering up uninterrupted blocks of time for thinking and reflecting and just letting the batteries recharge.
Glenn E: Absolutely, and that is not a surprise given the trip to Australia for lunch among other things. I want to go …
Rosabeth MK: I have to stay the night before.
Glenn E: Oh, okay, that’s fine. I want to go back to your discussion about responsibility and CEOs and certainly the high profile nature. You spend a lot of research recently around leadership in the digital age and how that is so different. What are some of the characteristics that make a brand successful as a leader in this digital age?
Rosabeth MK: First of all, the brand and then I can talk a little about leaders as individuals, which increasingly needs to encompass all of us. A brand in a digital age, you can’t control it just because you say it is what it is, because this is interactive. It was really interesting to me because I was involved with first dotcom boom and I wrote a book called ‘E-volve!’ about it and about what was changing. What was really striking was how many established companies at that time thought, “This is great, the internet. It’s just one more, one way communication channel.” They were not taking advantage of the potential to create communities and to connect people with one another. Good parents today in the digital age are in many ways armed as much by the community of the users of the advocates of fans as it is shaped by the company. One has to be aware of that. You don’t always control that. You don’t always know who they are.
Now, of course, there’s a big business boom and everybody doing the metrics and telling you exactly who it is so you can target the message exactly to them. All of that personalization is going to matter a great deal but that, also, of course, people talk to one another, and that shapes the brand. Brands have to be truly authentic and stand for something that is truly creating value for those people who are going to be part of it, and enhance their lives. If it’s not improving lives, ultimately, it’s not clear that it’s going to have lasting value.
There’s a company I write about in SuperCorp is Procter & Gamble. While Procter & Gamble is a very brand-conscious company and it’s known more for its individual brand Press, Pampers, Tide, et cetera, then necessarily the corporate, but when I was working on SuperCorp and I sent the manuscript to Ronald McDonalds who was then vice-chairman and is now the CEO to review, because that’s something we do. We want the facts to be right, and he said, because I was emphasizing their sense of purpose at the heart of the company, that they have this statement of purpose about improving lives. He wrote me back and said this makes him want to emphasize the PVP – Purpose, Values, Principles even more. I said, “Bob, I was writing about you. You’re saying you want to be more you.” The answer was, in a way, yes and now they are.
I’ve had some amazing experiences on these fly-by journeys. I was speaking in Nigeria and then spent time with some of the Procter & Gamble people in West Africa. The Pampers people saw their mission as improving lives helping babies thrive and in a place with high end, more quality. They realized they couldn’t simply be marketing diapers. They needed to help mothers, help their babies thrive, and so they started sending mobile clinics with mobile not in the phone sense although they did use mobility applications, text messages later. They would send out an actual van with the doctor and two nurses to places that didn’t have access to healthcare. People would bring their babies. Mothers would bring their babies, and they would give them two free Pampers, but that would be an inefficient way just to market Pampers but because the brands cared for the sense that we want your baby healthy. Actually, they have had an impact on health and Pampers sale did soar, and they’re using mothers to model many places. I said, “That’s very inspiring. When you take that idea of what are the values we actually stand for and think about than what other responsibilities you undertake, that tells people who you are, what you do, and they want to be part of that community.”
I know loyalty, brand loyalty, automatically is a thing of the past in the digital age despite what I said about loving my doctor, and I will be sad when it goes, but it’s that you build a bond and you are doing something improving society that improves your bottom line via the products themselves and the things you throw on the products with. That’s a great brand, and the digital impact can be enormous. Also, I learned in West Africa that some things they were doing for girls’ education because they make a lot of feminine products, and it’s having educational component. Within a very short time after they started doing things to keep girls in school that all end up their products, they had in a country that is a developing country in a continent certainly far away from the US. They had hundreds of thousands of users on a Facebook page right away, who were teenage girls who, otherwise, couldn’t really talk about their particular bodies and what was happening because they were in families where their mothers especially, their parents, certainly not fathers, wouldn’t talk to them about it and they found a community that actually was started because of a product and what the product was doing. The community takes on a life well beyond the product that when the company is actively enhancing and supporting that, the effect is really powerful. That’s what you want because in the digital age, it can go exactly the other direction, too, and that is they can put up a website that says, “Company X.com” and soon you’ll have all your users or non-users organizing about what they hate about you. You only have to think about how you must start responding to what they said.
For leaders, too, this is a very powerful new phenomenon because leaders can hide behind hierarchy. They can’t have a correspondence office of 300 people that answers the occasional snail mail or phone call. People want direct access. I love CEOs and in the companies I work with, I get that access, but there are other CEOs who actually answer their own email. Now, I’m sure they still have 300 people answering that in a unique, special relationship, which again I might be privileged to have, but you have to answer that email. People want direct access. It’s interesting. In the digital age, when you can be reached, known to people that you don’t even know at the same time one-to-one, people want to get to that person, and so you can’t be remote and be distant and wait a long time. Leaders have to get that crisis moment, hear if they’re hating you and organizing against you, and do something right away. Otherwise, they’re letting the companies out and actually generally, you’re fired. It does take time. It’s why my many hours in the morning, and I’m just a professor. I keep saying whatever fortune I have, but I can imagine what it’s like, but you have to be accessible to be able understand you’re always on, that your personal conduct, somebody’s taking a picture of you if you’re drunk at a party or somebody exposing your torrid emails.
You have to think of yourself as always in public, and by the way, can I make one more comment about the digital age?
Glenn E: Absolutely.
Rosabeth MK: Just a quick comment because of the important work you do and you’re certainly in the center of helping people use these new tools. I’m honored to be with you. My other pet thing that I talk about is we all say, “The young people, they don’t care as much about privacy. You get to look at what they post and look at what they share and distribute to each other.” They may have 13 or eight year olds, 12 year olds to 20, 22 year olds might not care, but out that, that when they get to be 28, 29, 30 and they start to have families and are little more buttoned down, have careers, I bet they actually look back and groan at what they allowed to be out there because it’s now going to stick with them the rest of their lives. You don’t always have that sensibility. You don’t always sense about the long-term. It seems so ephemeral.
I love tweeting and tweets are ephemeral. They come and go. People may be following thousands and don’t get a lot if, but yet they’re also there permanently. I don’t know if we’ve quite conveyed to people the longer term impact of your conduct, and that’s what leaders and all of us have to think about. That’s why big companies are actually thinking about building these lasting values not just a momentary pleasure or a momentary offer or a momentary high.
Glenn E: What’s fascinating to me going through your examples of your leading brands is how you’ve just emphasized on how inextricably linked the CEO is to the brand, and then times past, it was a company and, yes, there was a CEO to lead. What you just described always on pictures at parties, accessibility is an incredible challenge, but you used the responsibility. It is really fascinating to see the people, the companies that you have highlighted as top to your innovative growth leaders and it always starts at the top with the CEO and his or her actions.
Rosabeth MK: Yes, it does. It does. Even in the startups. The startups that I actually think have the most potential. I’m doing some a little bit of research and wants to continue it on who emerges in new tech industries as the dominant player especially when it can be win-or-take-all or you can create a network. When you have a million users, the network effects start kicking in and you become more valuable. Even the startups who become the dominant player tend to have more and better partnerships at the beginning and often have a strong partnership at the founding even if one person emerges like Larry Page at Google. Sergey Brin is still there, but Larry Page at Google, but there’s a partnership already, and so there’s already a leadership and also there’s an emphasis from the beginning on a strong, positive culture and values from the beginning, when you think you’re not in the public eye particularly.
I think that can also predict success even for small startups, the one I’ve talked about SuperCorp. I give lots of examples of giant companies. I also give examples of small ones including DigiTech, of companies that understand that because you’re going to hit hard times and your culture helps you weather that. Your values help you weather that. Your users, your customers, consumers would feel part of the family. It’s why I picked eBay out of all of the … eBay and Amazon early on. First of all, I thought they had a great business propositions that early on I was predicting their success. EBay started expanding into other areas, hit some stumbles, but it was that they were building a strong culture inside the company as well as community with users.
Yes, the CEO as a person … it’s a tricky business because we’ve watched CEOs come and go, who made themselves too important, and that actually … the CEO does represent the company, but you also don’t want to bypass all the other people who really are the company. I thought Carly Fiorina, who was fired a CEO of Hewlett-Packard, you could see her mistake coming in. Yes, she got a lot of publicity as the woman ex-CEO, but she made herself more important than the company. She put herself in the adds.
Glenn E: Interesting.
Rosabeth MK: Yet, Hewlett-Packard, there were two men, Hewlett-Packard who did it out of people who grew it. If you look at the contrast, it’s an interesting contrast, the HP-IBM. IBM has a woman CEO, Ginni Rometty. It’s almost unremarkable that she’s a woman. That was what I said to the media when she was appointed. I said, “She’s an engineer and a great business person, and that’s a bonus that she’s a woman.” IBM is a company where the company name, the company brand, and she certainly represents it, so do a lot of other people. She’s aware of those responsibilities of a leader, but she puts the IBM brand first. There’s no cult of personality.
We were all a little worried about Apple. First of all, it was very sad Steve Jobs’s loss. With Apple, it has a personality in many ways as well as fantastic design and innovation and with that transfer to a new CEO. I have to laugh about Apple because for a while, wrapped turtle necks were what you wore at Apple. Now, it’s half-opened collared shirt.
Glenn E: That’s right. Thank you, Mr. Cock. I’m going to interrupt for a second. We’re going to take a really quick commercial break. Please stand by, and I’ll be right back with Rosabeth Moss Kanter on more of the conversation.
[Commercial]
Glenn E: Welcome back to Market Edge. This is your host Glenn Engler and I’m here today with Rosabeth Moss Kanter, Harvard Business School professor and author of SuperCorp, talking about leadership in the digital age.
You had a recent blog post, which I loved, which was entitled, if I recall, ‘If You Don’t Like Your Future, Rewrite Your Past’ and you talked about a concept called kaleidoscope thinking, which you described as a mental process of shaking up the pieces and reassembling them to form a new pattern.
Can you talk a little bit more about that concept?
Rosabeth MK: Glenn, thank you for picking that up because it’s one of my favorite ideas, and we talked a lot about out-of-the-box thinking, that became a metaphor for creativity. I actually also has been pushing the idea, so we have to think not just outside the box but outside the whole building. Look at the world around us, but kaleidoscope is a better image and that is very static. A kaleidoscope is just a device you look through to see a pattern. Outside, sometimes, it’s the fragments in the kaleidoscope that has an infinite set of possible patterns. You shake it, twist it, change angle, change direction, you get a new pattern. I thought as much brain research is showing, a lot of the way we think is a little like that dreams. You’re putting together pieces in a different way and making up a story, and there are lots of narratives we could have about how things are going.
A long time ago, when I was first starting in the change business, I realized that were leaders were doing when they created change in a company or in a community or what they were often doing was simply rewriting the past that is they were shifting the pattern to emphasize something that has been peripheral back then is suddenly essential now and they could see we’re capable of doing that.
Outside, there’s the stories we tell ourselves also can be they’re negative or positive. They can emphasize some things rather than other things. Now, in a way, I want every company to reach back into its history and find all the threads that they have of social justice and employee empowerment and contributions to society. Make that their story. Not when I did that, I got some people who say, “That’s then.” Well “then” is a negative word meaning it’s false. There needs to be some reality when you look for those things in the past that can tell you you do it in the future. We have, as human beings, the capacity to put the pattern together in a whole different way.
I keep thinking about who was it that invented the world’s first ice cream cone. Yes, there was ice cream and scoops and somebody said, “Hey, we can make this portable.” The first mobile app, “We can make this portable if we wrap it quickly around the ice cream.” Somebody took things that exist. A lot of new business ideas are often not a new invention. They’re putting something together in a different way. Two things that were never connected are put together in a different way.
I run of thoughts of kaleidoscope from time to time and just shake it up and look at the same problem in a fresh way. That’s what brainstorming is, too.
Glenn E: So interesting.
Rosabeth MK: Be authentic but …
Glenn E: Yes, I love it.
Rosabeth MK: It’s helpful to all of us. It’s helpful to all of us.
Glenn E: It is but I love it. You’ve authored or co-authored, if I go back to that for listeners, an absolutely astounding 18 different books. Is there a topic that you’re either passionate about with a thread through these or something that keeps popping up that you keep going back to?
Rosabeth MK: Oh, sure. First of all, those 18 books, I would say, probably seven or eight are major, and there are others that are fine, that they’re readers or co-authored or something else. I have the burst of every few years, burst of ideas that tie a lot of things together and I do these conflicts projects, but I’m really interested in making systems work better, human systems, organizational systems. The thread is those things that create positive cycles or negative cycles. I’ve had that as a theme in many different things, and I like doing the contrast.
Another recent book, not as recent as SuperCorp, but wrapped together a lot of ideas with confidence. The subtitle is ‘How Winning Streaks and Losing Streaks Begin and End.’ Its all in the title, I was interested in how systems have momentum and that momentum can lead you downhill and everything piles on and the situation gets worse or you can have positive momentum. Don’t winning, a lot of advantages accrue that allow you to keep on winning.
Then the issue is where does leadership come in? Its leaders shift the cycle. That’s when they’re really important actually when they move the momentum from possible negative or actual negative to positive. I was interested in turnaround and also these long why some … I use sports, too. I actually studied sports. Why some teams have long winning streaks and others have long losing streaks? What is it? If it’s done? Leaders do do things that help make move the momentum in a positive direction.
What I like about that and I’ve seen running through everything is even when I’m talking about companies, I’m also telling a human story of how people are interacting with one another, of what the quality of the workplace is, of whether people have opportunities to express their ideas. Empowerment is a really big theme running through my work. I would say that since the beginning, I was interested in the power of the people in how you create organizations that give people more voice.
Naturally, I love the digital tools for the more voice. I will also say about digital tools is that you can organize negatively over the web. You can organize revolutions. You can organize meet ups. You can encourage people to get out and do one thing that it’s very hard to organize something that has a sustained life. It’s very hard. You even use it for communication. You still need leaders who help organize people face-to-face and it may be multiple people in multiple places. Those things still matter. There’s some enjoined troops about people and their interactions and the ability to look people in the eye from time to time that hasn’t disappeared. We just have new tools that help give more people voice and the other theme is how can that voice say positive? How do we give people hope? How do we create great organizations, great companies that do positive things?
Now, it sounds like a lot of themes but …
Glenn E: They definitely come together on it.
Rosabeth MK: The consistent ideas throughout my work are innovations that is how you get the kaleidoscope thinking the new ideas and get them put into use, collaboration, how do people work together more effectively. Those are two big things.
Glenn E: I could go on with so many questions, but unfortunately we’re out of time and you’ve been incredibly generous with your time. I want to thank you, Rosabeth, for being my guest today, and thanks to everyone in the audience for listening to today’s conversation.
If you have questions or would like to talk further about the topic of today’s show, feel free to connect with me on Twitter at Twitter.com/GlennEngler or on my blog at www.glennengler.com. Visit www.webmasterradio.fm at 12 noon Eastern Time on Tuesdays to tune into episodes of Market Edge. For Market Edge, this is Glenn Engler. Until next time, I’m out.