from the world's big
The Management Revolution
Over the past twenty years, Hamel has authored 15 articles for the Harvard Business Review. He has also written for the Wall Street Journal, Fortune, The Financial Times and many other leading publications around the world.
Hamel's books, Leading the Revolution and Competing for the Future, have appeared on every management bestseller list and have been translated into more than 20 languages. His latest book, The Future of Management, was published by the Harvard Business School Press in October 2007 and was selected by Amazon.com as the best business book of the year.
Since 1983, Hamel has been on the faculty of the London Business School where he is currently Visiting Professor of Strategic and International Management.
As a consultant and management educator, Hamel has worked for companies as diverse as General Electric, Time Warner, Nokia, Nestle, Shell, Best Buy, Procter & Gamble, 3M, IBM, and Microsoft. His pioneering concepts such as "strategic intent," "core competence," "industry revolution," and "management innovation" have changed the practice of management in companies around the world.
Hamel speaks frequently at the world's most prestigious management conferences, and is a regular contributor to CNBC, CNN, and other major media outlets. He has also advised government leaders on matters of innovation policy, entrepreneurship and industrial competitiveness.
At present, Hamel is leading an effort to build the world's first "Management Lab." The MLab is a pioneering attempt to create a setting in which progressive companies and world renowned management scholars work together to co-create "tomorrow's best practices" today. The goal: to radically accelerate the evolution of management knowledge and practice.
Topic: Accelerating change
Gary Hamel: There’s a very good chance that over the next few years we are going to see a revolution in management, that is just as profound as the revolution in management that gave birth to the industrial age. When we moved from a craft-based and agrarian economy, to an industrial economy. Why is this going to happen?
Three forcing functions are going to make this happen. The first is accelerating change. We literally live today in a world where change has changed. We are the first generation in history where the pace of change has gone hyper-critical within our lifetimes. Think for a moment about all the things right now that are changing at an exponential pace. CO2 emissions, number of genes sequenced, number of internet domains out there, the amount of bandwidth that's available to people, global population. Whole variety of things changing at an exponential rate.
We know that the lifespan of a great strategy is shrinking. A company goes from that takeoff stage through growth, to maturity and senescence, faster than ever before. All of this is testament to a simple fact. Our world is becoming more turbulent, faster than most organizations are becoming more adaptable and more resilient. And you look around us today and you see all kinds of companies that are struggling to get their mojo back. Entire industries like music and pharmaceuticals and publishing, where the whole industry has fallen behind the change group. Historically, there was only one way to change a large organization and that was to wait until it tumbled into crisis and then to decapitate the leadership team. Start with a new leadership team.
When you read all those books on change, you get two kinds of stories. Change that's trivial, and change that is traumatic, change that is deep, but came as a result of a crisis. It's kind of sad to admit, but these large organizations tend to change in the same way poorly governed dictatorships change- belatedly and convulsively. And this is simply no longer good enough. We're going to have to change the way organizations change, make it much more like the body's autonomic systems, that are constantly taking information inputs in and responding. But not something that is crisis driven, that's episodic. We need instead change to be opportunity driven and continuous.
Gary Hamel: A second great challenge that's going to produce a management revolution is simply the fact that we live in a world today that is becoming more and more competitively intense. There's no place to hide from competition today. You have new competitors with zero legacy costs or with radically new cost models. We have pressure from consumers who are so extraordinarily well informed today, who can compare and shop and have literally perfect data. A lot of the friction that companies once relied on to prop up their margins, the friction of ignorant customers and high transaction costs, high search costs, all that friction is being driven out of the economy.
And every company is in a race to create new forms of differentiation, faster than they lost these old kind of sources of protection for their margins. And the only way you're going to win that battle, is by creating companies that are deeply, deeply innovative. Innovation's a big buzz word today, but I would argue there's not one company out of 100 that's made innovation the work of every single employee.
And if you want to test me on that, here's a simple question, a couple of questions you can ask to any frontline, first level employee in your organization. Ask them first of all this; how have you been trained as a business innovator? I hear all these CEOs talking about how important innovation is, but I know of no more than one or two companies that have trained every single employee to be an innovator. Why wouldn't we do this in the same way that Toyota trained people to be great problem solvers?
Innovation is not something that occurs naturally. You can develop an aptitude for it, you can learn how to unpack industry orthodoxies, how to identify the unarticulated needs of customers. How to look at the world around you, the competencies, the capabilities of other companies and figure out new and creative ways of putting those together with your capabilities, to create new services, new products. You can teach people all of these things and yet we haven't done it.
Topic: Knowledge as a commodity
Gary Hamel: Thirdly and lastly, we also live in a world where knowledge itself is becoming a commodity. Over the last few years as companies have gotten into more and more relationships with other companies, industry consortia, outsourcing, off-shoring, supplier networks, all of those new arrangements are conduits through which skills and knowledge flows.
Think about Apple getting into the mobile phone business. How is a company with no history in that business, how do you get into that from a standing start, in about 18 months? How does that happen? It happens because most of the knowledge, most of the technology Apple needed to do that, it could buy off the shelf as commodity knowledge. The chipset, the RF antenna, batteries, packaging, you wrap a beautiful user interface around it, you build some wonderful new industry architecture, the App Store.
And so you have this amazing success, but the only way to do it in that timeframe was that a lot of that knowledge was already commodity. Turn an Apple iPhone or an iPod around and read the back, it will say, "Designed in California, made in China." Now what part of that equation would you like to have, right? It doesn't matter today how big you are. It doesn't matter where you sit in that eco-system. What matters is the ratio of value to cost that you're producing, right. What's your share of the total value that customers get out of this ultimate product, versus what is the share of cost that you had to incur in producing that value?
So you look at Apple today with about three, four percent of the market for mobile phones by volume, but representing about 30 percent of the profitability of that industry. Huge amount of value proportionate to the cost. How do you do that? You do that by creating a company where people every day are willing to come to work and bring you their imagination and their creativity and their passion. You have to create an extraordinary workplace that prompts that extraordinary contribution that drives extraordinary value.
Recorded on August 14, 2009
Business thinker Gary Hamel thinks accelerating change, fierce competition and knowledge becoming a commodity will fuel the fire for transforming how companies are run.
Higher education faces challenges that are unlike any other industry. What path will ASU, and universities like ASU, take in a post-COVID world?
- Everywhere you turn, the idea that coronavirus has brought on a "new normal" is present and true. But for higher education, COVID-19 exposes a long list of pernicious old problems more than it presents new problems.
- It was widely known, yet ignored, that digital instruction must be embraced. When combined with traditional, in-person teaching, it can enhance student learning outcomes at scale.
- COVID-19 has forced institutions to understand that far too many higher education outcomes are determined by a student's family income, and in the context of COVID-19 this means that lower-income students, first-generation students and students of color will be disproportionately afflicted.
What conditions of the new normal were already appreciated widely?<p>First, we understand that higher education is unique among industries. Some industries are governed by markets. Others are run by governments. Most operate under the influence of both markets and governments. And then there's higher education. Higher education as an "industry" involves public, private, and for-profit universities operating at small, medium, large, and now massive scales. Some higher education industry actors are intense specialists; others are adept generalists. Some are fantastically wealthy; others are tragically poor. Some are embedded in large cities; others are carefully situated near farms and frontiers.</p> <p>These differences demonstrate just some of the complexities that shape higher education. Still, we understand that change in the industry is underway, and we must be active in directing it. Yet because of higher education's unique (and sometimes vexing) operational and structural conditions, many of the lessons from change management and the science of industrial transformation are only applicable in limited or highly modified ways. For evidence of this, one can look at various perspectives, including those that we have offered, on such topics as <a href="https://www.insidehighered.com/digital-learning/blogs/rethinking-higher-education/lessons-disruption" target="_blank">disruption</a>, <a href="https://www.nytimes.com/2020/02/20/education/learning/education-technology.html" target="_blank">technology management</a>, and so-called "<a href="https://www.insidehighered.com/sites/default/server_files/media/Excerpt_IHESpecialReport_Growing-Role-of-Mergers-in-Higher-Ed.pdf" target="_blank">mergers and acquisitions</a>" in higher education. In each of these spaces, the "market forces" and "market rules" for higher education are different than they are in business, or even in government. This has always been the case and it is made more obvious by COVID-19.</p> <p>Second, with so much excitement about innovation in higher education, we sometimes lose sight of the fact that students are—and should remain—the core cause for innovation. Higher education's capacity to absorb new ideas is strong. But the ideas that endure are those designed to benefit students, and therefore society. This is important to remember because not all innovations are designed with students in mind. The recent history of innovation in higher education includes several cautionary tales of what can happen when institutional interests—or worse, <a href="https://www.insidehighered.com/news/2016/02/09/apollos-new-owners-seek-fresh-start-beleaguered-company" target="_blank">shareholder</a> interests—are placed above student well-being.</p>
Photo: Getty Images<p>Third, it is abundantly apparent that universities must leverage technology to increase educational quality and access. The rapid shift to delivering an education that complies with social distancing guidelines speaks volumes about the adaptability of higher education institutions, but this transition has also posed unique difficulties for colleges and universities that had been slow to adopt digital education. The last decade has shown that online education, implemented effectively, can meet or even surpass the quality of in-person <a href="https://link-springer-com.ezproxy1.lib.asu.edu/article/10.1007/s10639-019-10027-z" target="_blank">instruction</a>.</p><p>Digital instruction, broadly defined, leverages online capabilities and integrates adaptive learning methodologies, predictive analytics, and innovations in instructional design to enable increased student engagement, personalized learning experiences, and improved learning outcomes. The ability of these technologies to transcend geographic barriers and to shrink the marginal cost of educating additional students makes them essential for delivering education at scale.</p><p>As a bonus, and it is no small thing given that they are the core cause for innovation, students embrace and enjoy digital instruction. It is their preference to learn in a format that leverages technology. This should not be a surprise; it is now how we live in all facets of life.</p><p>Still, we have only barely begun to conceive of the impact digital education will have. For example, emerging virtual and augmented reality technologies that facilitate interactive, hands-on learning will transform the way that learners acquire and apply new knowledge. Technology-enabled learning cannot replace the traditional college experience or ensure the survival of any specific college, but it can enhance student learning outcomes at scale. This has always been the case, and it is made more obvious by COVID-19.</p>
What conditions of the new normal were emerging suspicions?<p>Our collective thinking about the role of institutional or university-to-university collaboration and networking has benefitted from a new clarity in light of COVID-19. We now recognize more than ever that colleges and universities must work together to ensure that the American higher education system is resilient and sufficiently robust to meet the needs of students and their families.</p> <p>In recent weeks, various commentators have suggested that higher education will face a wave of institutional <a href="https://www.businessinsider.com/scott-galloway-predicts-colleges-will-close-due-to-pandemic-2020-5" target="_blank">closures</a> and consolidations and that large institutions with significant online instruction capacity will become dominant.</p> <p>While ASU is the largest public university in the United States by enrollment and among the most well-equipped in online education, we strongly oppose "let them fail" mindsets. The strength of American higher education relies on its institutional diversity, and on the ability of colleges and universities to meet the needs of their local communities and educate local students. The needs of learners are highly individualized, demanding a wide range of options to accommodate the aspirations and learning styles of every kind of student. Education will become less relevant and meaningful to students, and less responsive to local needs, if institutions of higher learning are allowed to fail. </p> <p>Preventing this outcome demands that colleges and universities work together to establish greater capacity for remote, distributed education. This will help institutions with fewer resources adapt to our new normal and continue to fulfill their mission of serving students, their families, and their communities. Many had suspected that collaboration and networking were preferable over letting vulnerable colleges fail. COVID-19's new normal seems to be confirming this.</p>
President Barack Obama delivers the commencement address during the Arizona State University graduation ceremony at Sun Devil Stadium May 13, 2009 in Tempe, Arizona. Over 65,000 people attended the graduation.
Photo by Joshua Lott/Getty Images<p>A second condition of the new normal that many had suspected to be true in recent years is the limited role that any one university or type of university can play as an exemplar to universities more broadly. For decades, the evolution of higher education has been shaped by the widespread imitation of a small number of elite universities. Most public research universities could benefit from replicating Berkeley or Michigan. Most small private colleges did well by replicating Williams or Swarthmore. And all universities paid close attention to Harvard, Princeton, MIT, Stanford, and Yale. It is not an exaggeration to say that the logic of replication has guided the evolution of higher education for centuries, both in the US and abroad.</p><p>Only recently have we been able to move beyond replication to new strategies of change, and COVID-19 has confirmed the legitimacy of doing so. For example, cases such as <a href="https://www.washingtonpost.com/education/2020/03/10/harvard-moves-classes-online-advises-students-stay-home-after-spring-break-response-covid-19/" target="_blank">Harvard's</a> eviction of students over the course of less than one week or <a href="https://www.nhregister.com/news/coronavirus/article/Mayor-New-Haven-asks-for-coronavirus-help-Yale-15162606.php" target="_blank">Yale's apparent reluctance</a> to work with the city of New Haven, highlight that even higher education's legacy gold standards have limits and weaknesses. We are hopeful that the new normal will include a more active and earnest recognition that we need many types of universities. We think the new normal invites us to rethink the very nature of "gold standards" for higher education.</p>
A graduate student protests MIT's rejection of some evacuation exemption requests.
Photo: Maddie Meyer/Getty Images<p>Finally, and perhaps most importantly, we had started to suspect and now understand that America's colleges and universities are among the many institutions of democracy and civil society that are, by their very design, incapable of being sufficiently responsive to the full spectrum of modern challenges and opportunities they face. Far too many higher education outcomes are determined by a student's family income, and in the context of COVID-19 this means that lower-income students, first-generation students and students of color will be disproportionately afflicted. And without new designs, we can expect postsecondary success for these same students to be as elusive in the new normal, as it was in the <a href="http://pellinstitute.org/indicators/reports_2019.shtml" target="_blank">old normal</a>. This is not just because some universities fail to sufficiently recognize and engage the promise of diversity, this is because few universities have been designed from the outset to effectively serve the unique needs of lower-income students, first-generation students and students of color.</p>
Where can the new normal take us?<p>As colleges and universities face the difficult realities of adapting to COVID-19, they also face an opportunity to rethink their operations and designs in order to respond to social needs with greater agility, adopt technology that enables education to be delivered at scale, and collaborate with each other in order to maintain the dynamism and resilience of the American higher education system.</p> <p>COVID-19 raises questions about the relevance, the quality, and the accessibility of higher education—and these are the same challenges higher education has been grappling with for years. </p> <p>ASU has been able to rapidly adapt to the present circumstances because we have spent nearly two decades not just anticipating but <em>driving</em> innovation in higher education. We have adopted a <a href="https://www.asu.edu/about/charter-mission-and-values" target="_blank">charter</a> that formalizes our definition of success in terms of "who we include and how they succeed" rather than "<a href="https://www.washingtonpost.com/opinions/2019/10/17/forget-varsity-blues-madness-lets-talk-about-students-who-cant-afford-college/" target="_blank">who we exclude</a>." We adopted an entrepreneurial <a href="https://president.asu.edu/read/higher-logic" target="_blank">operating model</a> that moves at the speed of technological and social change. We have launched initiatives such as <a href="https://www.instride.com/how-it-works/" target="_blank">InStride</a>, a platform for delivering continuing education to learners already in the workforce. We developed our own robust technological capabilities in ASU <a href="https://edplus.asu.edu/" target="_blank">EdPlus</a>, a hub for research and development in digital learning that, even before the current crisis, allowed us to serve more than 45,000 fully online students. We have also created partnerships with other forward-thinking institutions in order to mutually strengthen our capabilities for educational accessibility and quality; this includes our role in co-founding the <a href="https://theuia.org/" target="_blank">University Innovation Alliance</a>, a consortium of 11 public research universities that share data and resources to serve students at scale. </p> <p>For ASU, and universities like ASU, the "new normal" of a post-COVID world looks surprisingly like the world we already knew was necessary. Our record breaking summer 2020 <a href="https://asunow.asu.edu/20200519-sun-devil-life-summer-enrollment-sets-asu-record" target="_blank">enrollment</a> speaks to this. What COVID demonstrates is that we were already headed in the right direction and necessitates that we continue forward with new intensity and, we hope, with more partners. In fact, rather than "new normal" we might just say, it's "go time." </p>
Sallie Krawcheck and Bob Kulhan will be talking money, jobs, and how the pandemic will disproportionally affect women's finances.
Scientists uncovered the secrets of what drove some of the world's last remaining woolly mammoths to extinction.
Every summer, children on the Alaskan island of St Paul cool down in Lake Hill, a crater lake in an extinct volcano – unaware of the mysteries that lie beneath.
Manly Bands wanted to improve on mens' wedding bands. Mission accomplished.
- Manly Bands was founded in 2016 to provide better options and customer service in men's wedding bands.
- Unique materials include antler, dinosaur bones, meteorite, tungsten, and whiskey barrels.
- The company donates a portion of profits to charity every month.
These new status behaviours are what one expert calls 'inconspicuous consumption'.