One of the areas we are studying this Fall in a Case
Study for a MBA class is to create a business environment of blameless
reporting. A corporate culture of encouraging employees to report anything that
goes wrong or seems substandard without fear of reprisal for the act of
reporting.
To create an environment of psychological safety and
high accountability within a company. Can this work?
Finance is complex, and whenever you have
complication and uncertainty, it is a given that things will go wrong at some
point. When they do, the best way to deal with those mistakes is to use them to
learn and grow. And the only way an organization can be aware of issues while
they’re still small-scale is to create an environment in which employees and
managers at all levels feel safe voicing their concerns and thoughts.
Companies that foster a culture of blameless
problem-solving have the potential to learn from what goes wrong, and also to
innovate, through smart experimentation, while companies that habitually blame
individuals are in danger of running into large-scale disasters without a hint
of impending doom.
Here are some tips for creating a workplace
environment in which people feel they can speak up about what’s happening and
collectively work hard to improve and avoid big problems:
Promote smart experimentation. Experimentation is how companies innovate and develop tomorrow’s new
offerings, but you want to make sure that the experimentation strategy is a
smart one. Organizations should never experiment on a grand scale in uncertain
domains. Experiments need to be big enough to get valid data about their
viability, but not so big that the potential failure will be devastating to the
business.
Invite input. Leaders need to make it clear to people that their voice is not only
expected but also welcomed. There’s an implicit belief that no one ever got
fired for silence. I think the job of leaders is to flip that around. In the
complex, uncertain industry in which we operate, the people that we’re not
hearing from are not of much value.
Because the tendency for employees is to remain
silent about issues, leaders need to be proactive in inviting input. It’s one
thing to say, “I’d love to hear from all of you,” but it’s another to turn to a
specific employee and ask, “What do you think of this situation? I’d love your
thoughts.”
Avoid stretched goals and closed ears. While there are several examples of organizations doing a good job of
creating a culture of blameless problem-solving, there are also examples of
companies that have faced the consequences of squelching safe and open
communication.
Wells Fargo’s recent failure, in which millions of
accounts were created without consumers’ consent, is one such example. The
bank’s initial cross-selling strategy wasn’t fully in touch with the reality of
customers’ limited wallets, which created immense pressure to have more and
more products per customer, leading employees to activities that became
fraudulent and problematic in other ways. Had employees felt able to speak up,
push back, and say what they were learning, the strategy might have been
tweaked.
Develop a productive response to bad
news. Psychological safety in the workplace can be shattered the second a
boss erupts in anger over a reported failure.
Leaders need to train themselves not to overreact
emotionally to bad news. They need to pause, breathe, and disrupt what might be
the natural, instantaneous reaction of emotion or disapproval, and say, ‘Thank
you for that clear line of sight.” Now what should we do next? What are your
ideas? Here are my ideas.’ It’s what I call a productive response to bad news,
as opposed to a natural, in many ways normal, response to bad news.
Next Blog: How this relates to and drives the CEO Business Roundtable.
TOP FIVE – US Restaurant chains (revenues):
1. McD’s, $38.5B
2. Starbucks, $20.8B
3. Chick fil-A, $10.5B
4. Subway, $10.4B
5. Taco Bell, $10.3B
VISICALC - It’s not often you discover the secret history of something you
thought you already knew, but that’s what happened to me this summer when I
started investigating the impact of VisiCalc, the world’s first spreadsheet. Why
research the history of spreadsheets? Because in my world, I am lost without a
spreadsheet; sad but true.
Who knew Steve Jobs himself said VisiCalc was more
responsible than any other factor for the early success of Apple? Or that its
successor, Lotus 1-2-3, was built by VisiCalc’s former product manager? Or that
Excel, the next iteration of the spreadsheet, drove the adoption of Windows,
changing how both Wall Street and Main Street accomplished that most essential
of tasks: keeping an eye on the money.
Finding the key players turned out not to be hard.
Dan Bricklin, designer of VisiCalc and the historian of the bunch, once gave a
TED talk that’s been viewed more than a million times. From him, it was easy
enough to hop from one person to another. They all still keep tabs on each
other—even if they were locked in bitter competition all those years ago. In
the early days of the PC, it was a much smaller world than it is now.
But this wasn’t just a walk down Memory Lane. Not
only was VisiCalc the first killer app, but as a Promethean event in the
history of personal computing, it has come to define tech-industry disruption.
Its lessons are valuable to this day.
It was the first killer app, the spark for Apple ’s
early success and a trigger for the broader PC boom that vaulted Microsoft to
its central position in business computing. And within a few years, it was
tech-industry roadkill.
The story of VisiCalc, a humble spreadsheet program
that set the tech world ablaze 40 years ago, has reverberated through the
industry and still influences the decisions of executives, engineers and
investors. Its lessons include the power of simplicity and the difficulty of
building a hypergrowth company in a hypergrowth industry.
Indeed, its lessons have been so internalized by
today’s tech titans that they have significantly inoculated themselves against
that sort of tumultuous, competitive dynamism—aka disruption.
VisiCalc was unveiled on June 4, 1979 and shipped
that October. Dan Bricklin first dreamed it up in a classroom at Harvard
Business School—the room now bears a plaque commemorating his idea—and
partnered with Bob Frankston, who coded VisiCalc and collaborated in its
design.
When users opened VisiCalc, they would see a
character-based grid where numbers or text could be manipulated. It was handy
for budgeting, financial projections, bookkeeping and making lists. Today it’s
instantly recognizable as a spreadsheet, as familiar to us as a blinking
cursor, but at the time it was a novel idea that had to be experienced to be understood.
Initially VisiCalc ran only on the Apple II, a
then-revolutionary new personal computer and Apple’s first major consumer
product. While some Apple II models had just 4 kilobytes of RAM, VisiCalc
demanded a whopping 32KB. (Even the cheapest of today’s iPhones have tens of
thousands of times as much RAM.)
“It was a cute little program but who was going to
expect anything big out of it?” recalls Mr. Frankston.
Steve Jobs subsequently said that VisiCalc
“propelled the Apple II to the success it achieved more than any other single
event.”
VisiCalc was the first piece of software that was so
popular that it drove people to buy computers just to run it. A 1984 article
for PC Magazine noted: “People entered computer stores to purchase VisiCalc and
something to run it on.” At the time, VisiCalc cost $100, but the Apple II to
run it could set you back $2,000 or more—much more. The revenue of VisiCalc’s
publisher, which was almost entirely attributable to VisiCalc itself,
mushroomed from virtually nothing in 1979 to more than $40 million in 1983,
says Edward Esber, who was VP of marketing at the company.
This was the first lesson of VisiCalc—that the dawn
of a new platform is when empires are built. In this case, the shift was from
the paper ledgers that accountants had used for centuries, to their digital
equivalent on the PC.
The PC was arguably the first modern tech
platform—that is, a thing that had value because it enabled many different
types of software and services—and much of what happened next became typical of
every computing platform that has come since.
Unfortunately for Messrs. Bricklin and Frankston,
the second lesson of VisiCalc was that a killer app doesn’t guarantee enduring
success. The software might have been the first tech victim of what academic
Clayton Christensen would later call “disruptive innovation”—when a smaller
company outflanks an incumbent by targeting an overlooked market.
Mitch Kapor, who worked for VisiCalc’s publisher as
a product manager, left the company and began working on his own spreadsheet
program. Instead of creating it for the Apple II, Mr. Kapor put his money on
another horse: the brand-new IBM PC. Released in 1983, his software—Lotus
1-2-3—took the world by storm on a scale that even VisiCalc’s success couldn’t
have foretold.
“It honestly seemed to most people like a very risky
thing to do, because in the market at the time, Apple II was the dominant
machine,” says Mr. Kapor.
Lotus 1-2-3 included the major features of VisiCalc,
and even allowed direct import of VisiCalc files. But it could do more. As
someone who was very familiar with the spreadsheet market, Mr. Kapor knew what
customers were clamoring for. Lotus 1-2-3 had variable column widths, a macro
language to allow simple programming in cells, and the ability to create charts
and graphics. Plus, it was fast.
VisiCalc, meanwhile, was mired in a lawsuit between
its creators and its publishers—software in its early days was distributed
under an author-publisher model, like books. The acrimony was likely one reason
the developers failed to capitalize on the rise of the IBM-compatible PC.
One year after the IBM PC debuted, fewer than
100,000 units had shipped. In that time Lotus 1-2-3 shipped $53 million of
spreadsheets. By year two, the IBM PC had sold 280,000 units and Lotus achieved
$156 million in sales.
On the strength of pre-orders alone, Lotus
Development, the parent company, won a then-extraordinary $5 million in venture
capital, and in 1983 the company went public. Within a few years of its
founding, Lotus had thousands of employees.
“At the time we were the world’s largest independent
software company, and two years before that we didn’t exist,” says Mr. Kapor.
The third lesson of VisiCalc and its successors is
that the tech industry’s biggest players now understand the threat of
disruption, and make it harder for upstarts with innovative ideas to challenge
their dominance.
Now, when trend watchers spot a potential new
platform, even the largest companies invest heavily in it—especially if it
might mean their disruption, says Steven Sinofsky, former head of the Windows
division at Microsoft and current partner at venture-capital firm Andreessen
Horowitz.
After Mr. Kapor stepped down as CEO of Lotus, the
company focused on porting its product to IBM’s OS/2, its attempt to beat
Microsoft at PC operating systems, missing the shift to Microsoft’s Windows.
That shift was driven largely by users clamoring, yet again, for the best
system to run the best spreadsheet—in this case Excel, which Microsoft
announced for Windows in 1987.
Microsoft went on to largely flub other platform
shifts, especially to mobile computing. But more recently, it managed the shift
to cloud-based software with great success by embracing the disruptive
technology—witness the fact that it is again the world’s most valuable publicly
traded company.
Big companies getting ahead of their own disruption
is now common. The iPhone was born out of Apple’s paranoia that someone else
might supplant the iPod. And Facebook ’s acquisition of potential disruptors
Instagram and WhatsApp gave the company the dominant social platforms on
mobile, where most online social networking subsequently moved. Amazon’s
dominance in voice-controlled assistants is a product of the company’s
willingness to launch startups within itself and allow them to quickly fail—as
the Fire Phone did—or disrupt much bigger incumbents, as Alexa took both Apple
and Google by surprise. And Google, of course, had the foresight to acquire and
invest heavily in Android.
Certainly, there are still examples of new companies
rising, but it’s hard today to imagine the handful of giants that loom so tall
over the tech world allowing themselves to go the way of VisiCalc or Lotus. And
the more wealth they accrue to buy into new technologies, spreading their bets
evenly around the whole roulette wheel, the more invulnerable they appear.
BIRTHDAYS
THIS WEEK – Birthday wishes and thoughts this week to Jimmy Fallon (45),
Tommy Lee Jones (73), Dan Pugliese …famous hockey Dad, Ava Suffredini ….the
best niece, Trisha Yearwood (55).
FOGCAM - This month, the oldest
operating internet webcam will shut down, the site’s administrators said last
week. FogCam started as a student project at San Francisco State University (go
Gators) and, barring a few location changes and maintenance updates, has
faithfully broadcast campus images since 1994.
FogCam was inspired by the first internet webcam, a coffee pot
live stream created by scientists at the University of Cambridge.
By today’s standards, FogCam’s pretty simplistic. But in 1994,
when the internet was pay-per-minute, it was cutting edge. FogCam's basically a
lock for the Smithsonian Guggenheim Museum of Internet History.
Early webcams gave internet users their first taste of streaming.
In the decades since, they’ve sped up, streamlined, and democratized video
communications.
FogCam co-founder Jeff Schwartz said Adam Curry used it as a model
for his website (something called “MTV”). And another early webcam of a fish
tank—created by Netscape’s founding engineer Lou Montulli—served as a test bed
for internet improvements that laid the foundation for e-commerce, GIFs, and
uploaded photos.
NORTHERN EXPOSURE - On the highway, when people
slow down to look at a car crash, climate change is like that because everyone
is slowing down to look at the accident but not realizing that we are actually
the car crash. Reuters takes you to Longyearbyen. "With a population of
slightly more than 2,000 people, it is the northernmost town on the planet. It
is also the fastest-warming." A climate-change frontier in the world's
northernmost town.
From the fastest warming town on the planet to the fastest warming
city in America. The hellish future of Las Vegas in the climate crisis: 'A
place where we never go outside.' (It's a dry heat.)
While the very different towns of Longyearbyen and Las Vegas give
us a view into climate change's ominous future, the intensity of Dorian
provides a real time look at its present. People who live in The Bahamas are
used to hurricanes. But they're not used to this. The epic power of Dorian came
to The Bahamas. And it stayed there. AP: Humanitarian crisis unfolds in
hurricane-stricken Bahamas.
L.E.D. ZEPPELIN - The gradual shift toward more
efficient light bulbs is one of the largely unsung success stories in the fight
to reduce energy use and greenhouse gas emissions. U.S. household energy
consumption is down 6 percent since 2010, and this is due in part to the
increase in the use of energy-efficient lighting. Well, if it's good for society and good for
the environment, you probably know what's coming... NYT: Trump Administration
Is Rolling Back Rules Requiring More Energy-Efficient Bulbs. (No one ever
accused him of being the brightest bulb...)
INGLEWOOD, CALIFORNIA — SoFi Stadium at Hollywood Park, the future
home of the Rams and Chargers, will cost roughly $5 billion to build, making it
the priciest NFL venue by a mile.
Naming rights: Private
lender SoFi will reportedly pay more than $30 million annually over 20 years to
put its name on the stadium — the most ever paid for stadium naming rights.
The big picture:
Hollywood Park will also feature residences, hotels, retail spaces, public parks,
a concert venue and office space. Add it all up and the complex could cost $10
billion, making it one of the largest privately financed projects in the
country.
Looking ahead: In
addition to housing the Rams and Chargers, SoFi Stadium is already set to host
the Super Bowl in 2022, the college football championship in 2023 and the
Olympics in 2028.
SWAMI’S WEEK
TOP PICKS
–
NFL Football Pick of the Week – Sunday 9/22, 8:20 PM (ET), NBC: Los
Angeles Rams (2-0) vs. Cleveland Browns (1-1). The Los Angeles Rams have won
three NFL championships, and they are the only franchise to win championships
representing three cities (Cleveland in 1945, Los Angeles in 1951, and St.
Louis in 1999). Yes, this week the Rams return to their original city,
Cleveland. Rams win 24 – 14. (Season to Date 1-1)
NFL Football Pick of the Week – Thursday 9/26, 5:20 PM (ET), FOX/NFL: Philadelphia
Eagles (1-1) vs. Green Bay Packers (2-0). Tough to win in Lambeau, especially
with a depleted offense: Pack win 30 – 17.
College Football Pick of the Week – Saturday 9/21,
8:00 PM (ET), CBS: #7 Notre Dame Fighting Irish (2-0) at #3 Georgia Bulldogs
(3-0). Sanford Stadium will be drinking Sweetwater Happy Ending brew not
Guinness in this one. Bulldogs win 35 – 24. (Season to Date 3-1)
College Football Pick of the Week – Friday 9/27,
8:00 PM (ET), FS1: #13 Penn State Paternos (3-0) vs. Maryland Terrapins (2-1).
I smell an upset in the Big Ten, Maryland wins 38 – 34.
DIII College Football Pick of the Week – Saturday
9/21. 1:00 PM (ET), HGTV: Alfred Saxons (2-0) at #22 Ithaca College Bombers
(1-0). Two Central New York rivals clash at Butterfield Stadium on South Hill,
Bombers prevail 42 - 20. (Season to Date 1-1)
DIII College Football Pick of the Week – Saturday
9/28. 1:30 PM (ET), HGTV: #2 Mt. Union Purple Raiders (1-0) vs. #14 John
Carroll Blue Streaks (1-0). Mt. Union heads to Don Shula Stadium with one of
D-III’s best programs in recent memory. Purple Raiders win 38 – 28.
SCIAC Pick of the Week (Football) – Saturday
9/21, 7:00 (PT), Hallmark: #10 Whitworth Pirates (1-0) vs. Chapman University
Argyros (1-0). The Pirates continue their march through the SCIAC, 40 – 24.
(Season to Date 2-0)
SCIAC Pick of the Week (Volleyball) – Tuesday
9/24, 7:00 PM (PT), Hallmark: University of La Verne Leopards (6-5) vs. #3
Claremont-Mudd-Scripps Republicans (9-2). SCIAC conference play begins and
these two rivals clash in both teams league opener. Republicans continue to
dominant 3 – 1.
MLB Pick of the Week – Saturday 9/21, 11:20 AM (CT) Comcast: St. Louis Cardinals (86-67) vs. Chicago Cubs
(82-71). I t is time to say adios to the Cubbies, Cards win 5 – 3.
(Season to Date 7-4)
MLB Pick of the Week – Saturday 9/28, 1:05 PM (ET) FS1: Cleveland Indians (90-63) vs.
Washington Nationals (83-68). The last weekend of the 2019 season and these two
teams are slugging it out for a one game playoff. Nats win 6 – 2.
English Premier League Pick of the Week – Saturday 9/21, 4:30 AM (PT) CNBC: Leicester City (2-2-1) at Tottenham
Hotspur (2-2-1). The Spurs win this one, 3 – 1. (Season to Date 1-3)
English Premier League Pick of the Week – Saturday 9/28, 7:00 AM (PT) NBC: Everton (2-1-2) vs. Manchester City
(3-1-1). Man City is playing nice football thus far this season, they win 2 – 1. (Season to Date 1-3)
2019 Season
to Date (29 -22)
Next Blog: Words of the Month, Dear Rink Rats, and Digital Cash.
Until
next time Monday September 30, Adios
Claremont,
California
September
20, 2019
#X-9-398
3,380
words, eight minute read
CARTOON OF
THE WEEK – The New Yorker, Teresa Burns
RINK RATS
POLL – What is your safe place?
_____ Home
_____ Work
_____ With Family/Friends
_____ DraftKings
_____ I
never feel safe
_____ Hoot
Owl
_____ Don’t
know
QUOTE OF THE
MONTH
– “No work is insignificant. All labor that uplifts humanity has dignity and
importance and should be undertaken with painstaking excellence.”
—Martin Luther King, Jr.
Rink Rats is a blog
of weekly observations, predictions and commentary. We welcome your comments
and questions. Also participate in our monthly poll. Rink Rats is now viewed in
Europe, Canada, South America and the United States.
Posted at Rink Rats The Blog: First Published – May 3, 2010
Our Tenth Year.
www.rhasserinkrats.blogspot.com
