#offthepress

The website OFF THE PRESS is topping their fold with a “Drudge Report is dead” headline.. It links to an article written by the editorial board at Issues and Insights..

You can read the full story here.. 

The main gist seems to be Drudge’s inattention to the unfolding Hillary Clinton Russia scandal in which it is alleged she paid for an Internet company to infiltrate Trump servers.. The article points out that Drudge alienated himself from Trump at some point, and this is the basis for the Drudge is dead header..

They write:

The site became decidedly anti-Trump several years ago, and it isn’t even known for sure whether Matt Drudge remains the owner, be it in whole or part. He himself once craved personal attention, with his own ill-fated weekly Fox show (wearing the cliched reporter’s fedora, though mercifully not including a “press” card tucked into its band. (For the record, back in the days when nearly all male residents of American cities wore fedoras or similar dress headwear, they had the sense and civility to keep their hats off while indoors). He even wrote a book, “Drudge Manifesto,” which one fond Drudge admirer dismissed as “Lots of little phrases, most of them not complete sentences, all strung together in an incomprehensible stream-of-consciousness style.”

While there may have been a dip in readers, the site still boasts huge numbers:

28,280,048 PAST 24 HOURS 746,361,968 PAST 31 DAYS 7,764,562,745 PAST YEAR

Similar website reports relatively strong numbers despite the conservative critics..

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An interesting article by Zeynep Ton on HBR today raises a very important point about what should be an adequate compensation for service employees, and retail associates in particular. The link to what we have discussed yesterday commenting the Business Roundtable new view on corporate purpose.

The call to pay people more, but also to create more “good jobs” is especially valid in retail. It’s true that by looking at the hard facts of a store P&L, labor cost is one of the most significant cost factors in retail, which leads too often to all possible efforts to cut and contain this line of budget. But reality is that without creating an investment mentality on store associates (i.e. pay more to get more), retailers will not succeed especially in the wake of Digital Transformation affecting the business.

Traditional approaches have led retail to pay too often just minimum wages, but also creating a lot of other negative effects with low minimum contracted hours, requests for high flexibility, no real career prospects.,

These workers struggle to pay for basic necessities like rent and health care and are rarely able to save for retirement or emergencies — even a new car battery. Many have unstable schedules, affecting not only their income but also their children’s education and their family’s healthcare. Many are assumed by their employers to be, as one retail worker told me, “a dime a dozen, just human robots.”

Zeynep Ton – Service jobs should be – and can be – middle class jobs

The article reports some interesting numbers from the US. But also in. Europe we can track some very interesting data. About 17,2% of employees in the EU is defined as “low wage earner”, and most of these belong to Service jobs. For sure, total labor cost pays an important aspect in defining the weight of labor on retail performance, but overall we still see a lot of issues in this domain, especially in countries like UK, and in the largest cities. Where Retail is more developed and relevant, paradoxically salaries don’t even reach “living standard” level due to the costs of large cities.

The key point here is that many retailers are not putting enough focus on this. Too many spread words about the importance of consumer facing roles, but this rarely translates into focused actions.

I doubt we can identify a one size-fits-all answer to what is the correct salary. But I think whatever policy we adopt needs to answer 4 key dimensions:

Salary needs to allow employees to afford a living, aligned to their age and living necessities. Too often some retailers reason that part time jobs can be underpaid simply because they’re students who don’t need to make a living out of it. But reality shows that in many countries most retail employees do need to make a living out of their retail job.

Salary needs to cover for additional flexibility required. Retail needs flexibility, But this needs to be fairly compensated, because otherwise it becomes a new burden for the person. Each company needs to find a way to balance flexibility and employees needs through appropriate rewards policies, if needed.

Perks are fine but are not the final answer. Retail population is typically very variegated, geographically dispersed, differentiated. Many perks that can make sense for office jobs are either impractical in a store environment, or do not make sense to all. That’s why sometime is best to translate them in salary where possible.

Make sure incentives are consistent. Variable is an important tool to ensure that labor cost is somewhat linked to results. However it is really important that incentive systems are aligned to the Customer Journey the brand wants to represent. Else too quickly targets become unreachable, and the motivating element disappears or becomes even detrimental.

Is all this just a dream? Quite some brands are proving the opposite, and showing that increases wages are good for the business also in Retail, as they drive better customer satisfaction.

Just treating workers better, however, will not boost a company’s competitiveness. This is an important first step, however we need to consider also that a radically different operating system is needed. One designed to better serve customers’ needs and increase workers’ productivity, motivation, and overall contributions across multiple dimensions.

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After a couple of years of less focus on reading, I’ve been back on track with my old reading habits (as you can see on my Reading Challenge on Goodreads). I’ve especially been able to keep back track on some management eBooks that had been sitting for some time on my Kindle account, and will report on some of these over the next weeks.

This book was published in 2016, and has had a great success. I don’t recall exactly when I bought it, normally this happens when finding reference in an article or another book. In any case, am happy about the choice of buying it and reading it.

Todd Rose analyzes in this books the widespread perception that Individuals do not matter in a lot of domains, including design, management, education.

Quetelet’s invention of the Average Man marked the beginning of the Age of Average

He tracks down this to some major “mistakes” that affected the history of Social Science. The first is down to Adolphe Quetelet, a Belgian mathematician, who was the first to use mathematical averages to identify common traits in human beings. His famous study on the soldiers’ average chests, has been the beginning of a major overhaul in how people where identified and treated in social sciences.

Average, and later on Ranking (that the author refers together as Averagarianism) have created a revolution in Social Science, that led to the birth of Scientific Management and Taylorism, with the consequence that systems came first, and man (reduced to parts of efficiency) needed to adapt to the system.

Typing and ranking have come to seem so elementary, natural, and right that we are no longer conscious of the fact that every such judgement erases the individuality of the person being judged.

Even if Taylorism is now seems as a negative word by many (and this view has been consolidated in the last decades), it’s true that many basic assumptions are still existing. Most of Talent Management, argues Rose, is still based on the assumption that we can summarize individuals in one “number” (make it potential, performance or an average of the two). Forced rankings are still a default in many organizations, and continue to cause issues. This can be seen also in the continuous use of personality testing, that tend all to reduce individuals to a “fit” organized on a number of different dimensions (and way too often just to adhere to what the manager wants).

One of the key concepts introduced is that of “Jaggedness”. Two people with same IQ can have, in reality, two very difficult profiles. And it’s the gaps that make the uniqueness of the individual, vs. the “average” identified by the IQ score alone.

Another area explored, is the effect of this approach on Education and Training. All the educational systems are framed to get people to adapt to an “average” curriculum, instead of allowing individuals to find their own paths and bloom.

One of the most interesting consequences of “Averagarianism”, is the link with Diversity and Inclusion practices. The concept itself of “Equal Access”, comments the author, is an averagarian solution to an averagarian problem. Stating that we need x% of women simply to reflect an average of the population, again forces people to “fit” an average solution, which in the long term does not allow for real opportunities to be achieved.

Great book and reading overall, supported by a very well documented bibliographical research.

What’s in it for me?

I think that a the key concept (and solution proposed by the author) is the fact that at the end if we all look at our own life, we all walk the road less travelled. If I see my personal career, I have done many things that do not “fit” a traditional HR curriculum. And I am aware that this is actually and advantage both for my profession and how I’ve been able to contribute to the business.

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The recent statement issued by the Business Roundtable on corporate purpose, has raised a lot of media attention and buzz on professional networks like LinkedIn. Although the statement itself is not as revolutionary as it seems, (already the 1981 version did also acknowledge the importance of multiple constituencies for companies’ long-term success). Yes, for sure the 1997 version did focus a lot on shareholder’s primacy, and overall its true that aligning 200 CEOs around such a statement must have been a difficult endeavor.

As HBR underlines, the question is what are the effects of this statement going to be. Multiple authors and academics have focused on the risks of excessive focus on Shareholder value (Ralph Gomory is just one of the many names, that has been focusing on Corporate Goals). This declaration is not setting out a new world of corporate affairs though.

the language of the preamble suggests that it is little more than a new description of what CEOs already do—or believe they do.

This is why a lot of the articles and commentary, that saw a “victory” for example of Employees over Shareholders, are a faux-pas. Which is why some of the most interesting suggestions where on what can be the steps needed to really make a difference.

What is the purpose of a company?

I believe that all this discussion has luckily raised the curtain again on a very important topic, around what the purpose of a company really is. For too much time we have simply equated “for-profit” as the sole (or main) purpose for which an organization was actually built. During my years at the University of Bologna teaching Strategy for Non Profit, I used to challenge this assumption already by showing a different classification of organization, where profit was incidentally defined as a “mean for some specific organizations to reach their purpose”. What however needs to be recognized is that the legal and regulatory frameworks across the globe have typically favored very specific forms of organizations, characterized on sharing this profit among shareholders.

This very narrow focus is definitely an issue, as brilliantly illustrated in Daniel H. Pink’s books Drive – The surprising truth about what motivates us.

Way too often Purpose has been confused to a certain extend with Vision, Mission and Values. In my mind it is something that is much broader than this, and is directly and intimately linked to what keeps all of the stakeholders “attached” to an organisation: Employees, Shareholders (or other forms of investors, or donors in the case of not-for-profit), Customers, Suppliers… all relate to the organization because of its purpose. And only if we find a purpose that can encompass and balance this multiple “stakes” at play, our organization will be successful.

Recent developments: Customers and Suppliers

In the past decade or so, the impact of a renewed conscience by consumers, has led to a more focused drive of importance of the relationship with Customers and Suppliers. The raising importance of CSR (often pushed also by country requirements and political intervention, another important stakeholder), has brought a lot more focus on this relationship, with renewed investments and a more focused attention.

Purpose or Goals?

Employees: The loosers in the traditional world

Way too often, the primacy of Shareholders, joined with the increased focus on Customers and Suppliers (addressed in “silos”), led to a negative impact on Employees consideration. Sacrificed on the altar of “cost cuttings” measures, kept under the radar of one of the top cost dimensions, a lot of the focus on employees has given raise too issues, that also the most actual Talent chatter has never really solved. In too many cases employment is still subject to a burden of legal, regulatory and customary burdens that end up even more stressing this negative relationship.

In this context, a lot of the discussions around giving more focus on employees are really welcome. The Silicon Valley model has created a new understanding of Talent that requires more attention and focus. But unfortunately there are still too many areas of our economy where Employees are not yet put at the core of the corporate strategies.

Is creating a Purpose-led company the next Nirvana?

The answer is simply no. And the reason is that Purpose will for sure help (yes), but only if the entire and intricate web of dependencies that form the governance and management structure of an organization, are consistently adapted to be purpose-linked. In other terms, we can write the most wonderful Purpose for our organization, but if management is still incentivized on P/E ratio, or Shareholder Return, or short erm sales targets… all this will still contribute to a less-then-relevant result for most of the employees in an organization.