ENSTO TODAY 1/2016 35 et The case studies you shared with Ensto, General Electric and Google, placed a heavy emphasis on speed in every aspect of business. Laws and culture differ around the world, and change can’t always be made as fast in one place as another. Would you comment on that aspect of change? First, keep in mind those cases were selected because GE and Google were in particular situations and focused on general managers. But regardless of regional differ-ences, best practices still apply. There’s no argu-ment that if you look at speed of change, it’s dra-matically different now than 10 or 20 years ago. We’re in a global economy now. If in a global economy there are companies in one region moving at a different speed than others, then it creates a comparative advantage for one. Labor laws and legal issues we have to keep in mind, of course. It might be easier in the US to manage out underperfor-mance. You have to manage performance, which means rewarding the best people. No longer do companies have the luxury on the balance sheet to carry under- per-formers for decades. I think there are still com-panies where people put in different efforts but get the same reward. But this is changing in the global economy. et In your book, Chasing Stars: The Myth of Talent and the Portability of Performance, you write about “workers who are increasingly far more committed to an occupa-tion than to an employer.” But in the Nordic cultures, it seems employees already matter more – employers and employees value each other more, there is more of a team culture. If this is, in fact, true of Nordic compa-nies, is it an advantage in the global marketplace? Individual performance is an outcome of many dif-ferent cultures. Our research suggests that the more of a “we” culture you have, the less portable you are, because you depend on other people. The issue of whether talent is portable and whether you can hire from outside and expect them to exhibit high performance is a big ques-tion mark. If what you say is true that Nordic companies are by reasons of culture more team oriented then this trend of Finnish companies hiring more from outside becomes a problematic solution. We should spend more time devel-oping people from inside companies. If you believe in unique cultures (and, by the way, I think Ensto has a unique culture) then developing from within becomes a lot more important. People hired from outside in unique cultures might experience organ rejection. I think there is no substitute for developing the best and brightest, whether speaking about this company or overall. et You discuss two approaches: Nature and Nurture. Nature means hiring in volume so stars will rise, and hiring stars away from other firms. Nurture means con-stant training, mentoring, fostering loyalty, a long-term perspective. Is the Nurture approach particularly difficult for public companies that must deliver results each quarter? Do family firms like Ensto have an advantage here? First, it’s important to note that Nature matters. People have to have a positive IQ and without that nurturing does not help. But when we talk about stars it should be pointed out that there are quite a lot of people with talent who are able to accom-plish nothing. Maybe they wasted their talent, or an organization did not leverage their talent. The bottom line from our research is that stardom is a partnership between you and your employer. The employee has to bring some ambition and smarts to the table, but it’s a part-nership. If you’re a team-oriented “we” who works for a team- oriented company, that produces a better outcome than if you’re an “I” working for a “we.” The proper match is a multiplier of talent. It’s possible that you can be working for a company that has a negative impact on your performance. Is it easier to focus on nurturing and developing in companies that have a long-term orientation? I think the answer is yes. Are there fewer companies with long-term orientations that are publicly traded? The answer is also yes. It’s actually really hard nowadays with investors that focus short term. Look at how institutional investors turn over their portfolios versus 20 or 30 years ago. Look at investor activism, at hedge funds. It’s really hard for a company to have a long-term perspective. And development strategy is about long-term yield. With many of our businesses it’s an apprenticeship model. You work with a person and observe what he or she does. There is no book on how to become a great salesman, for example. It’s an apprenticeship model, and this takes time. Formal training is a small part of overall development. On-the-job and mentoring are the two big-gest pieces. In a partnership or privately owned company it’s easier to say, “We are building performance over the next decade, not over the next quarter.” Speaking of team-oriented cultures, in Chasing Stars you quote someone with Goldman Sachs who talks about “pronoun education,” noting that first-person singular is only used to describe a mistake, not an accomplishment. Accomplishments are expressed as “we.” That’s encour-aging, yet at the same time you noted there are many com-panies with the opposite culture. My research was mostly conducted when Goldman Sachs was a partnership. It went public in 1999, and it’s a different company today. To clarify: I think we need to continued "We should spend more time deve- loping people from inside companies." BORIS GROYSBERG , HARVARD BUSINESS SCHOOL PROFESSOR
EnstoToday 2016 No1 / ENG
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