People & Strategy Winter 2015 Vol. 38 Issue 1 - 54

THOUGHTLEADERS
should be what followers accomplish. The
more you focus on that, the more you're
emphasizing teamwork and what followers
as a group accomplish as a team.
An effective leader has two primary objectives for effectiveness and one is selecting the
right people and paying attention to heterogeneity in terms of the group that's working
with you. And then finding ways to help that
group of people that work for you to work
together. Those two things, selection and
teamwork, are the two most important factors, I think, in terms of assessing the
effectiveness of an executive or manager.
But I'm also talking about what can be
rewarding and as I have always said being
part of something that's "bigger than I am" is
rewarding. For example, my life here at the
college includes six or seven different programs, all under the label of
"social-organizational psychology," and it's
that collective part that is the most satisfying
for me. It's what we all accomplish together
to have a coherent look.

MB: That's a good example. So many organizations assess individuals at the end of the
year and reward individuals on what their
unique contribution has been according to
some guidelines. Do you see potential for any
disconnects when we look increasingly for
teams to do the work effectively, but then
reward individuals?
WWB: Well, that's a very good point. And
disconnect is the right word in that what that
practice does is reinforce individuality rather
than teamwork; it works against what it is
that you are trying to do with respect to having a healthy organization and people feeling
like they are part of something that's important in their lives. So, yes, big disconnect.

MB: I think we're agreeing that performance
management and the line of sight from strategy to behavior to reward are important
aspects of organizational health. An overwhelming majority of companies surveyed
are dissatisfied with the effectiveness of that
process, yet they are unwilling to drop their
existing processes without a viable alternative. I wonder if you have any thoughts about
how that impacts health?
WWB: It's the fundamental issue of the conflict between performance and development:
organizations err on the side of performance
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PEOPLE & STRATEGY

and rarely pay attention to development. It's
development that gives you the biggest payoff, rather than focusing on the individual
manager's bottom line. In other words, has he
or she grown people? The people who worked
for this person, what's happened to them? We
just do not pay sufficient attention to developmental kinds of activity and reward them.

MB: Do you believe that this research is now
dormant because it's now a received message
that leaders are either predisposed to believe
or not, and will continue to use correlational
studies to reaffirm their biases until a definitive cause-and-effect study is published one
day?

So, you may have produced some dynamite
people for the last two years, but they have
moved on-because you helped that process-but you don't get anything for that.
There's a disconnect when some people say,
"I'd like to work for Michael," but then
Michael gets no reward or recognition.

WWB: Well, that's a good point because the
Kotter and Heskett study, as much as I admire
it, was really hard to draw direct links
between cause and effect from. It had more
of a correlational nature in terms of their
research design, but it was very suggestive. I
have referred to it many times over the years,
but boy, you just can't find any other studies
like that.

MB: Warner, let's just switch gears a little bit
and talk about the relationship between organizational health and organizational
performance. At McKinsey, we've established
a link between organizational health and
long-term total return to shareholders. 1
That's just one example of a modest but
growing body of research. Ben Schneider is a
great example of academic researchers establishing linkages between soft things like
culture and health on one hand, and hard
outcomes like return on investment, return on
net assets, and sales. I remember you introducing us to [J.P.] Kotter and [J. L.] Heskett's
book, Corporate Culture and Performance in
the early 1990s. 2 Donning your academy
garb for a moment, what is the state of that
linkage research today and what are we learning?

I think another factor here is obviously what
research gets published, because there are
probably some informal studies that have
gone on. They never got published, but we
would love to see them. What gets published,
of course, are those things that are methodologically very rigorous, but the more rigor
that exist in the study, the less relevance.

WWB: My impression is that the state of that
research is dormant because I have not run
across any lately. By the way, I don't read
every journal article that comes across my
desk. But I do look at the contents of every
journal.
You know, maybe we should look at the professional literature in Denmark and some
other places where they are doing research
like this.

MB: Specifically, Denmark or you're just
using Denmark as an example?
WWB: Well, they are enlightened people in
that matter, that's for sure, as they are in Sweden and the Nordic parts of the world in
general. I don't know specifically, but I'd
speculate that's a great place to look.

MB: To business folks, is that what you
mean?
WWB: Yes, that's what I mean. Most of the
articles that are published in top-notch journals are written by people who are trying to
get tenure, and that tenure process drives
what gets published, not so much what might
be really needed.

MB: Do you believe that there is a link
between organizational health and performance?
WWB: Yes.

MB: What is the evidence base that you think
of when you think about that linkage?
WWB: There is that study by Sonnenfeld and
some others published in the Administrative Science Quarterly about the work of the top
team-and how they worked together at the top
had a direct influence on the bottom line. 3 And
the more they modeled, so to speak, working
together and enjoying one another's company
rather than a big competitive process, the better and the higher performance. That's about
the only study I can think of that comes close
to what you are talking about.

People & Strategy Winter 2015 Vol. 38 Issue 1

Table of Contents for the Digital Edition of People & Strategy Winter 2015 Vol. 38 Issue 1