Many entrepreneurs make the fatal mistake of jumping directly to a mass market with an innovation. They fail to grasp the central dynamic of innovation adoption: most people respond not to the superiority of an idea but to whether other people are using the innovation. Most people don't want to look dumb trying something novel that turns out to be stupid. To make an innovation successful, first you target the most influential venturesome innovators and early adopters and move sequentially through the cycle. If you jump straight to the mass-market laggards, your idea will probably fail.
Tapping human potential to enhance performance
The Human Side of Enterprise
BY DOUGLAS MCGREGOR (1960)
This masterwork has had a profound effect on the trajectory of management thinking and is as relevant today as when it was written, more than 35 years ago. McGregor set forth the foundations of humanistic management and argued that how well an organization performs is directly proportional to its ability to tap human potential. That ability, in turn, relies on rejecting the Theory X view of people and embracing the Theory Y view of people.
Which of the following two sets of assumptions more closely resembles your beliefs? 1) The average person would prefer a life of leisure over a life of work; organizations must have mechanisms of control, direction, and punishment to ensure adequate effort from the average person; most people seek security over achievement; the average person would rather be told what to do than shoulder significant responsibility. 2) For the average person, work is as natural and desired as rest or play; most people will exercise self-control, display self-initiative, and actively seek responsibility when they feel committed to a set of objectives; commitment comes primarily not from fear but from rewards, especially intangible rewards like the feeling of achievement and self-actualization; the average person has significant untapped capacity for creativity and ingenuity. If you chose the first set, you operate under a Theory X view of people; if you chose the second, you fall into the Theory Y category.
Theory X management still dominates most organizations. Many managers and entrepreneurs still hold hidden assumptions that people cannot be fully trusted, need to be "checked up on," need "motivation," or don't really like to work all that hard. Fear, distrust, coercion, carrot-and-stick management, and authoritarianism are alive and well in the 1990s. And it's not just limited to big old companies; many entrepreneurs rule their kingdoms with a Theory X iron fist, too.
Unfortunately, McGregor died in 1964, long before the popular explosion of management books, and his work never reached a broad audience. Too bad--it would do the world a lot of good.
Motivating high-performance work teams
The Soul of a New Machine
BY TRACY KIDDER (1981)
Read The Human Side of Enterprise and The Soul of a New Machine simultaneously; they complement each other beautifully. Kidder's book portrays the dynamics of high-performance work teams and of Theory Y management at its best by telling the true story of a project team working with limited resources to design a new computer in less than a year.
Kidder reveals a truth of management that all who have worked on a great team know but that most businesspeople and economists seem to forget: the strongest motivation and the best work do not come primarily from the lure of money, stock options, formal recognition, or advancement. Not that those are irrelevant (most people--even creative artists--want to be recognized and rewarded for their work), but I can point to many companies laced with such incentives that utterly fail to display the high performance, dedication, and team spirit portrayed in Kidder's book. The challenge of a difficult task, the pursuit of a clear and compelling goal, personal responsibility for a significant contribution to the overall effort, and individual freedom in the pursuit of one's work--those elements provided the primary fuel and source of commitment. The individuals in Kidder's story had to come through; they could not let their comrades down.
Not one of the engineers in the book had the prospect of getting rich off the project. The pursuit of the project itself--not the rewards it would bring--made life meaningful for the people on the team. I'm reminded of NASA scientists on the moon mission, and pilots who worked without pay in the early days of Federal Express. They look back on their experiences as some of the most satisfying of their lives--even though they looked forward to the end of the struggle--for it was then that they felt most alive.
Setting down the bible on management thinking
The Practice of Management
BY PETER F. DRUCKER (1954)
Drucker stands as the most significant management thinker of the 20th century. Enlightened and, above all, effective management is to him the central skill needed in all parts of a free society. Effective management dispersed throughout society--in business, in nonprofits, in education, in local government--made the triumph of the free world and the end of the Cold War possible and is the only workable alternative to a resurgence of tyranny or dictatorship. Drucker's goal is to make society more productive and more humane. He strives to lift us to a higher standard, not merely to help us be successful or amass wealth.
