Leadership

The Two Types of Decisions

Decision making is a fundamental part of leadership and management. While business savvy and intuition can carry one a long way, it helps to be familiar with the potential consequences of said decision before jumping to any conclusions. In an insightful new article from the Farnum Street blog, the two types of decisions are broken down, using some advice from Amazon CEO Jeff Bezos. These are put into perspective, along with some advice on how to make the best of each situation.

Much like diabetes, the type of decision to be made can be broken down into two types: Irreversible (type 1), and Reversible (type 2). Type 1 decisions tend are the higher-stakes decisions that would be too costly to come back from, where as type 2 decisions are easily corrected with little cost and/or time involved. Once issues are viewed on this spectrum of reversibility, it’s possible to know how to approach their solution. For type 1 decisions, the consequences can be much higher, so it’s best to make these decisions slowly. Gather information, weigh risks vs. rewards, and literally calculate potential costs if the results go sideways.

Some folks have a hard time knowing when to stop this process, however, and may miss the opportunity altogether. To know when the data gathering has gone far enough, the author recommends what he calls “Stop, LOP, or Know.” First of all: Stop. if helpful information has stopped coming in, it’s likely there’s no more to gather. Due diligence is great, but once you have a well-rounded view of things, there’s little chance of some earth-shattering piece of information coming in at the last moment. Take what information has come to light, and make the best of it. Secondly, LOP, stands for Loss of Opportunity. If the decision to be made faces a deadline, the opportunity could slip away unless a timely choice is made. And lastly, Know: leadership knows what to do, but may not want to face up to it. Some decisions are awkward and difficult, despite the fact that the answer is clear.

Reversible, or type 2 decisions, on the the other hand, should be made as quickly as possible. This is not a green-light to act recklessly or choose options out of a hat. This is just an acknowledgement that imperfection is acceptable where the stakes are lower. Bezos himself has said having to quickly correct a 70% sure option is better than waiting around for a 90% sure option. For these low-cost gambles, he may just be right. Give the full article a read here for more insights on when and how to incorporate these methods.

Intentional Networking

Keith Ferrazzi once said "The currency of real networking is not greed but generosity." Even in the current age of post-pandemic semi-separation that we still find ourselves in, networking is a fun and essential part of business at all levels. In the latest installment of Wharton’s incredible Nano-Tools for Leaders series, Marissa King, PhD and Professor of Management at Wharton has shifted the focus to the power of networking. In particular; networking with intention to shape your current group to unlock its potential.

Outside of peer advisory boards such as Vistage, current research shows that the vast majority rarely if ever works on our own networks. Shameless promotions aside, almost no one makes adjusting their personal network a priority. In most cases, however, these groups can have a profound effect on mentorship, promotions, pay, etc., so it seems like they are worth the investment. Here, King points out that less can be more. The quality of your connections far outweigh the quantity of numbers in that digital Rolodex.

The first step in making your network intentional is identifying the type of network you have:

  • Expansionists (larger groups, influential): create value by connecting contacts to one another, but are at risk of generosity burnout.

  • Brokers (diverse groups, collaborative): create value by building bridges between contacts that would not otherwise happen, but are at risk of having to mediate disagreements that may arise between very different industries.

  • Conveners (smaller, closed groups, supportive): create value by connecting only those they support and trust, but are at risk of becoming monotonous echo chambers.

Once you have identified which type of network you exist in, the next step is to consider that answer in relation to your current needs and career stage. Keep in mind these categories are by no means mutually exclusive. As King points out “you can call upon different parts of your network depending on the situation”, so combine them or switch fluidly between them as you see fit. Check out the full article here for a deeper dive and to read up on some real-world examples of how leaders put this nano tool into action.

Overcoming Obstacles to Performance

We all have to perform in front of people at different times in our lives. Whether you are in the public eye or not, this can be a daunting task. In fact, it’s such a common phobia that it’s been given a name; Glossophobia. For those in leadership, addressing groups is a common task to be called to (and not always to deliver good news). Recently, Gretchen Rubin (of The Four Tendencies fame) and her podcast partner Elizabeth Craft released an episode about their own strategies to overcome stage fright and performance anxiety.

In this episode, Gretchen and Elizabeth both share tips and tricks to how they best addressed their own difficulties with public speaking after their most recent tour. Some examples include:

  • Take a beta blocker! This can help if the public speaker is prone to shaking hands and a shaking voice. These work by blocking the beta receptors in your body that cause symptoms of anxiety. In fact, many surgeons take them prior to major operations to calm their nerves and have a successful procedure.

  • Hold something in your hand. A pen, a cold water bottle, a mic, etc. Whatever it is, these can also help the shaky hands symptom of anxiety.

  • Do 10 jumping jacks before your presentation/performance. A good cardio blast helps our bodies and minds to focus on our breath instead of our nerves. The anxious symptom of a racing heart beat will start to slow, and a good amount of blood will flow to the brain. Just watch out for sweating!

  • Wear comfortable shoes. If you’re someone who doesn’t often wear heels, don’t choose your performance as a place to start doing so. Loads of people feel dizzy during or leading up to a presentation, and feeling off-balance due to your choice of footwear will only make it worse.

Check out the full episode here, and be ready to take good notes. It is chock full of helpful information for those who have speaking engagements coming up!

The Art of Unlearning

This blog has often featured articles about the joy of lifelong learning. Indeed, scientific research is now showing that embracing learning and our ability to change our minds in the face of new information is connected to wellbeing and longevity. There are times, however, when we must “unlearn” the things that no longer serve us. This is no easy task. Letting go of ideas and belief systems that got us to where we are today is difficult, but ultimately necessary for our growth as professionals and as humans in general. Hortense le Gentil has published a new article in Chief Executive Magazine with some insights on how to heighten your human potential as a leader.

Transitioning from a position in which technical skills were crucial, to a position of leadership, which requires the ability to inspire others is a daunting task. In her new article, le Gentil lays out three steps to reconnecting with the emotionally intelligent side of oneself, to become what she terms a “human leader.”

First, identify the mind traps in the way. These “mind traps” are simply old ways of thinking that become obstacles in a new role. The expertise that allows us to rise in the ranks and succeed in business will usually be ineffectual when it comes to leading others. Letting go of what we see as part of our roles or identities can be scary, so le Gentil recommends taking it slowly, which brings up her second step, changing the mind.

Second, operate a mind shift. Ask three fundamental questions each time an assumption pops up: Is it true?, Is it relevant?, and Is it still helpful today? Sometimes there will be easy and simple answers to these questions, sometimes not. Spend some real time on self reflection; journal, meditate, take a nature walk alone, get a coach or join a leadership peer group like Vistage! Shameless plugs aside, the importance of this step cannot be overstated.

Third, embrace a mind-build. Once the old ideals and expectations are dismantled, we can begin to build new ones that are more in line with the reality of being a leader. How do we want to be remembered, perceived, etc.? Le Gentil recommends the powerful exercise of writing one’s own eulogy to really get at the heart of how we wish to be seen. This is not a one-and-done deal, either. Connecting with the inner self and what makes us human is something that should be done every day, even for as little as 10 minutes.

Le Gentil has helped thousands of leaders grow into their roles through her coaching and through her writing. Do yourself a favor and check out her full article here, or check out her book, The Unlocked Leader here, and share them both with the other leaders in your life.

Leadership and Neuroscience

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Have you ever wondered what makes a leader’s brain different? What makes it tic? What makes team-building, decision-making, and inspiration easier for some than others? How does one maximize this potential? Well, thanks to today’s advances in neuroscience, we are beginning to see answers to those questions. Recently, Professor Michael Platt, Director of the Wharton Neuroscience Initiative, sat down for the new Meet-the-Author interview series, highlighting exciting research coming out of the Wharton School.

Platt’s new book, The Leader’s Brain, begins to explain how certain genetic traits in our neuro-physiology may predispose some to be more talented leaders. It can also explain why two different leaders will make drastically different decisions when presented with the same problem, and why even the most charismatic and talented leaders can sometimes make disastrous mistakes.

Check out Wharton marketing Professor Peter Fader’s interview with Platt (originally live streamed on Wharton’s LinkedIn page) to get a great introduction to the new book, and even pick up a few tips on how to maximize the parts of your own brain that make a great leader.

Lessons in Vulnerability

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Brene Brown rocketed to business stardom with her TED Talk on vulnerability; specifically, that leadership without the ability and willingness to be authentic and candid about one’s self is rarely seen as leadership.  But, like everything else, there’s a right and wrong way for a leader to display vulnerability.

If you want to be effectively and authentically vulnerable as a leader, check out this conversation between Dr. Brown and Wharton Business School’s Adam Grant in which she offers an important nuance on leadership and vulnerability that may help you avoid crossing the line between “authenticity and self-absorption”.

With the simplicity and clarity that has made her TED Talk and books so popular, she shows us “How to be vulnerable at work without spilling everything, from Brine Brown.  Her six word formula for doing so is profound. If you’re like most people and need more Brene-inspired leadership knowledge, check out her podcast that debuted last fall, Dare to Lead.

Leadership in the Corona Economy

COVID-19 has now appeared in 81 countries around the world.

COVID-19 has now appeared in 81 countries around the world.

As news reports keep coming in about more and more cases of COVID-19 around the world, it’s difficult to obtain reliable and succinct information about something as new, unfamiliar and dynamic as the Coronavirus.  Businesses, consumers and the government are reacting more to the lack of information than to anything that might be described as definite or even probable.

That said, here are a few articles about Corona that you might find thoughtful and if not reassuring, at least somewhat informative.  

The Short Term: Tech Industry Watcher Robert X. Cringely offers the first of two blog postings about the impact of Corona including what similar events in the past have taught us… and what’s different this time.

The Investment Perspective:  Investment writer and economist Bill Maudlin looks at how this is like and unlike the Y2K crisis of 20 years ago: the supply chain impact; the Fed’s role and possible opportunities in his blog posting “Covid-19: A Crisis the Fed Can’t Fix.”

Ready, Set, Fear?:  Stock market reversals this past week make investors wonder if the losses represent a new longer term bear market cycle, and whether the general economy can be far behind.  Economist Brian Wesbury walks his readers through a thoughtful analysis of the impact on stock markets and the larger economy as he explores the question “Is it Time to Fear the Coronavirus?”

An Update from ITR:  Brian Beaulieu, CEO of ITR Economics, wrote the following note over the weekend:

“The COVID-19 outbreak is clearly foremost in the minds of many of our clients and people in general. We are discussing it with our clients, and others, as a means to clear the way for a discussion about economics. We are not MD’s at ITR Economics but we know stats and history. Both are important and indicate that is unlikely a plague was about to be let loose in the US given our prior knowledge of the problem (unlike the Chinese), the status of the health care system in the US,  and the statistics associated with COVID-19 specifically.  Given the non-plague status of the outbreak and acknowledging there is hysteria in many circles, it is probable that the US consumer will perform as always: they will consume. We will watch this very closely. We will alert you if this changes. The correction in the stock market is disconcerting but we think this represents a buying opportunity.  There is time to pause here and make sure the market stabilizes before acting. However, that is the direction we think investors should be leaning.  We are also watching commodity prices, like oil, very closely as a “tell”.  But our assessment currently is that the economy is larger than all of this. The leading indicators in the next several weeks and months will inform considerably. Thankfully our children seem relatively safe, and life goes on. So, let’s plan for our businesses and maximizing profits assuming that the rational behavior and economics will rule the day. The key issues in China appear to be logistics and getting people back to work in their factories following the new year holiday. I expressed confidence in the Chinese to overcome these issues, but it may take 1 to 2 quarters.  Expect supply chain disruptions but expect them to be relieved in 2H20. Demand isn’t going to go away as the US consumer will continue to consume. Longer run, layered on top of tariffs and politics, expect this black swan event to hasten the shift away from China (and Asia in general) as a supply source and expect to see more nearshoring going forward.  While they say change is a constant, the pace at which it occurs is not.  Assess and seize the opportunities.”

Second Order Effects: In a complex system like the world, wise leaders have to go beyond simple cause and effect to further consequences, or “second order effects” down the line.  This short article in the New York Times may help you estimate the unexpected impacts on your business.