Author: James Allworth

  • Explainer: How Corruption Is Strangling U.S. Innovation

    Tesla. Uber. Netflix. Most economies would kill to have a set of innovators such as these. And yet at every turn, these companies are running headlong into regulation (or lack thereof) that seems designed to benefit incumbents. The reason? The devastating impact of money in politics and how it discourages disruptive innovation among new businesses. Click through this explainer to learn more about legal bribery and U.S. competitiveness:

    Let us know your thoughts about this content as an explainer; it was originally published as an article on Dec. 7, 2012.

  • It’s Not Women Who Should Lean In; It’s Men Who Should Step Back

    Men should read Lean Inso said friend and fellow HBR writer Nilofer Merchant. Three compelling reasons later, I had myself a copy of the book. While it might have been written as a treatise of what women could be doing to more of to gain more leadership positions in our organizations, and how we would all benefit from that happening, there was something else that stood out for me: it read as a pretty comprehensive list of things that the men have been doing wrong.

    More concerning still — it spent a lot of time encouraging women to copy us.

    There are two broad areas where the book offers advice. The first is how to get ahead in the workplace. Here, Lean In almost always prefaces its advice by first identifying areas where, relative to their male counterparts, women are (for want of a better term) “under-performing.” They aren’t as confident. They aren’t as ambitious. Men are more comfortable taking credit for their achievements, and there’s less cost to them individually when they do so. And so on. The assertions are often backed up with a big body of research.

    The problem comes not in identifying that there are differences between the sexes. The problem is that too often, the book simply asserts or assumes that in there being this difference, women have been doing something wrong.

    Let me give you an example: the relative difference in confidence between the sexes. In exploring this phenomenon, the book cites a research study of students in a surgery rotation; the study found that when asked to evaluate themselves, the female students gave themselves lower scores than the male students, despite faculty evaluations that later showed the women actually outperformed the men. Passed through the lens of Lean In‘s judgment, the ones at fault here are the women, for not being confident enough in themselves. The recommendation that comes later in the chapter: women should “fake it until they make it.”

    But is this really good advice?

    While Lean In might see the scenario as women lacking the confidence of men, there is a pretty glaring alternative hypothesis: it wasn’t the women who were lacking confidence — but it was the men who were too confident. It’s not that much of a stretch to suggest that the men who were more confident in their ability were the ones less likely to do the hard yards in preparation before the surgery rotation. The end result? They didn’t perform as well.

    And that’s the problem that runs throughout the book. Despite spending so much time citing research about the benefits of having women in leadership positions, a lot of its recommendations focus on, to put it bluntly, making women more like men, without proper consideration of whether that would actually be a good thing. As I read, I wondered: why is it the women who should be copying the men? Why can’t it be the men who could be well served by taking a page out of an entirely different book: that of the very women Lean In is advising to change? What it is about women that men could emulate to make our workplaces, our families, and our society in general a better place?

    And it’s not just behaviors in the workplace that Lean In takes this approach — it’s in career management, too. “Women are not less ambitious than men, they insist, but more enlightened with different and more meaningful goals. I do not dismiss or dispute this argument,” writes Sandberg. “There is far more to life than climbing a career ladder, including raising children, seeking personal fulfillment, contributing to society, and improving the lives of others.” And yet, having delivered that paragraph, the book then marches straight past it as if it never happened. In doing so, it takes one of the most important conversations we can have — that about building a career in the context of a life — and, for better or for worse, tips it upside down into a discussion about building a life in the context of a career.

    You don’t have to look very far to find evidence that thinking about life like this can come with serious costs. Clay Christensen, in the HBR article that was the prelude to the book that he, Karen Dillon and I worked on, talked about making it back to his HBS school reunions only to witness an ever-increasing number of his classmates unhappy from thinking about their careers in this way. And it’s far from just high-flying MBAs and executives that suffer from this problem: Bonnie Ware, who for many years worked in palliative care, articulately speaks to the same issue. She asked her patients about their regrets as they neared the end of their lives. Five themes emerged; I encourage you to go and read them. I want to quote just one: “‘I wish I didn’t work so hard.’ This came from every male patient that I nursed. They missed their children’s youth and their partner’s companionship. Women also spoke of this regret. But as most were from an older generation, many of the female patients had not been breadwinners. All of the men I nursed deeply regretted spending so much of their lives on the treadmill of a work existence.”

    The advice that Sandberg dispenses comes with serious costs. Those costs have traditionally been borne by men. But the book never considers that, rather than women not leaning in enough, that it actually might be men who have been leaning in too much. “Women rarely make one big decision to leave the workforce. Instead, they make a lot of small decisions along the way, making accommodations and sacrifices that they believe will be required to have a family.” “When asked to choose between marriage and career, female college students are twice as likely to choose marriage as their male classmates.” The book takes the research, applies its judgment to it, and implores women to change their point of view — because the men have it right. I’m not so sure, and nothing in Lean In convinced me otherwise.

    Early on in the book, Sandberg quotes Judith Rodin, president of the Rockefeller Foundation and one of the first woman to serve as president of an Ivy League university: “My generation fought so hard to give all of you choices. We believe in choices. But choosing to leave the workforce was not the choice we thought so many of you would make.” “So what happened?” asks Sandberg, before listing a number of reasons why it’s still incredibly tough for women to make it to the top. I don’t dispute any of them. But I want to posit that there’s another reason why so many women have chosen alternative paths, and it’s not because it’s difficult: it’s because that in terms of what generates sustained long term happiness in our lives, careers are a long way from the be all and end all, and women have simply done a better job of recognizing it.

    If men have taken the C-suite hostage, then Lean In presents with underlying symptoms of Stockholm syndrome. 50/50 is a worthy goal — both getting women in leadership, and getting men at home — but it’s not just important that it happens, but how it happens, too. That’s what I wish Sandberg had pushed for: not for more leaning in, but more pushing back from the current model.

  • The 787’s Problems Run Deeper Than Outsourcing

    The 787 Dreamliner was supposed to be a big jump forward for Boeing — notably, the first plane to be made entirely of composites rather than aluminum. It consumes 20% less fuel than an equivalent 767; which, given today’s increasing fuel prices and airlines’ diminishing profit margins, should make it an extremely desirable aircraft.

    Unfortunately, things haven’t quite worked out as planned.

    While the first 787 was originally scheduled to be delivered back in 2008, a string of delays and cost overruns meant that deliveries didn’t start until 2011. Boeing looked to have turned the corner with the 787 once deliveries had started, but since launch it has been plagued with a number of high-profile problems — fuel leaks, smoke in the cabin, and fires. The troubled plane has been grounded as global regulators investigate whether it’s safe to fly.

    Now, it is true that problems like these are always a feature of new plane launches. But the extent to which the 787 has been troubled both in gestation and post-launch suggests that something more is at work. Boeing undertook one of the most extensive outsourcing campaigns that it has ever attempted in its history. That decision has received a lot of press coverage, and the common wisdom is coalescing around this as a cause of the problems.

    But Boeing is no stranger to subcontracting. And while outsourcing can certainly lead to problems, I’m not convinced it’s the cause of these problems. Outsourcing leads to business model risk — you open the door to outsourcing your profits (in fact, a 2001 Boeing paper that is incredibly prescient and worth the time to read identified exactly this problem). But this isn’t the problem that the 787 is suffering from. At least not yet.

    Rather, the issues the plane has been facing have much more to do with Boeing’s decision to treat the design and production of such a radically new and different aircraft as a modular system so early in its development.

    In the creation of any truly new product or product category, it is almost invariably a big advantage to start out as integrated as possible. Why? Well, put simply, the more elements of the design that are under your control, the more effectively you’re able to radically change the design of a product — you give your engineers more degrees of freedom. Similarly, being integrated means you don’t have to understand what all the interdependencies are going to be between the components in a product that you haven’t created yet (which, obviously, is pretty hard to do). And, as a result of that, you don’t need to ask suppliers to contract over interconnects that haven’t been created yet, either. Instead, you can put employees together of different disciplines and tell them to solve the problems together. Many of the problems they will encounter would not have been possible to anticipate; but that’s ok, because they’re not under contract to build a component — they’ve been employed to solve a problem. Their primary focus is on what the optimal solution is, and if that means changing multiple elements of the design, then they’re not fighting a whole set of organizational incentives that discourage them from doing it.

    Conversely, if you’re trying to modularize something — particularly if you’re trying to do it across organizational boundaries — you want to be absolutely sure that you know how all the pieces optimally work together, so everyone can just focus on their piece of the puzzle. If you’ve done it too soon and tried to modularize parts of an unsolved puzzle across suppliers, then each time one of those unanticipated problems or interdependencies arises, you have to cross corporate boundaries to make the necessary changes — changes which could dramatically impact the P&L of a supplier. Lawyers will probably need to get involved. So too might the other suppliers, who could quite possibly be required to change the design of their component, also (chances are, you’ve already contracted with them, too). The whole thing snowballs.

    Historically, Boeing understood that, and had worked with its subcontractors on that basis. If it was going to rely on them, it would provide them with detailed blueprints of the parts that were required — after Boeing had already created them. That, in turn, meant that Boeing had to design all the relevant pieces of the puzzle itself, first. But with the 787, it appears that Boeing tried a very different approach: rather than having the puzzle solved and asking the suppliers to provide a defined puzzle piece, they asked suppliers to create their own blueprints for parts. The puzzle hadn’t been properly solved when Boeing asked suppliers for the pieces. It should come as little surprise then, that as the components came back from far-flung suppliers, for the first plane ever made of composite materials… those parts didn’t all fit together. Time and cost blew out accordingly.

    It’s easy to blame the outsourcing. But, in this instance, it wasn’t so much the outsourcing, as it was the decision to modularize a complicated problem too soon.

    Boeing’s experience bears comparing to another company, one which has mastered the art of managing design as an integrated process, while still utilizing outsourcing — Apple. Apple doesn’t manufacture their own products; but anyone who has used an Apple device can tell you that having someone else doing the manufacturing hasn’t compromised the quality of the product at all. But Apple treats both the design process and its suppliers very differently to the way that Boeing does — or at least did, in the case of the 787.

    Two key questions remain:

    Has Boeing learned from the mistake? Recent comments from their leadership suggest that they may have: Jim Albaugh, the company’s commercial aviation chief, noted that “in hindsight, we spent a lot more money in trying to recover than we ever would have spent if we tried to keep many of the key technologies closer to Boeing. The pendulum swung too far.” The company’s Chief Executive, Jim McNerney, said that he “would draw the lines in a different place” — but don’t mistake that for ditching the outsourcing, because he also said that he “would still have the same supplier/partner concept.”

    And why did Boeing decide to do this in the first place? The New Yorker provides some context on this question — and it relates to McDonnell Douglas. While ostensibly Boeing took over McDonnell Douglas, what really happened was more akin to a reverse takeover — McDonnell Douglas took over Boeing. Several of the top positions in the merged Boeing were assigned to executives who had previously worked in St. Louis, where the heritage of McDonnell Aircraft had been one of fighter and attack aircraft for the military. The thing about these Government contracts is that they are paid as development proceeds. This is entirely different — and a lot less risky — than the development model for a traditional commercial airliner, where an aerospace company needs to find all the capital. My hypothesis is that McDonnell’s mindset from its defense work — minimizing the amount of capital put at risk during R&D — was applied to the 787.

    They didn’t want to pay full price for the Dreamliner’s development, so, they didn’t — or at least, that’s what they thought. But as Henry Ford warned almost a century earlier: if you need a machine and don’t buy it, then you will ultimately find that you have paid for it and don’t have it.