Change management can be a test for any organization. Several studies by Towers Watson show that just 25% of change management initiatives are successful over the long term. I wouldn’t be surprised if the statistics are worse in my industry, financial services, where so many companies are large, global, regulated, and structurally complex.
So four years ago, when I was CEO of GE Capital Retail Finance and tapped to lead a mega change initiative — splitting off our unit into a new, publicly traded company, Synchrony Financial — I’ll admit I viewed it as a huge challenge. [...]
Amazon’s Alexa just got a new job. In addition to her other 15,000 skills like playing music and telling knock-knock jokes, she can now also answer economic questions for clients of the Swiss global financial services company, UBS Group AG.
According to the Wall Street Journal (WSJ), a new partnership between UBS Wealth Management and Amazon allows some of UBS’s European wealth-management clients to ask Alexa certain financial and economic questions. Alexa will then answer their queries with the information provided by UBS’s chief investment office without even having to [...]
Dave Wheeler for HBR
The idea of incentivizing CEOs and senior executives seems reasonable to most people. Yet the large executive bonus is a relatively recent phenomenon. Executive pay grew more slowly than the average worker’s income during the 50s, 60s and part of the 70s. It was in the 1980s that the ratio of CEO to average-worker pay grew dramatically. It “exploded” in the 1990s. The astronomical rates of CEO fixed pay and bonuses that we are so familiar with today are only about 20 years old.
Some researchers have argued that they’re a failed experiment. At the [...]
Marion Barraud for HBR
To gauge the impact of diversity and inclusion efforts, companies typically track metrics on the hiring, attrition, promotion, and composition of the current workforce. While such statistics are useful, they don’t provide a fully accurate picture. In reality, diversity and inclusion are not merely the number of nonwhite male employees you have. Rather, a truly inclusive organization contains a diverse cross-section of employees who actually interact with one another. So how do you measure this? A venerable management tool — organizational network anal [...]
Ironically, as congressional Republicans have been trying to replace the Affordable Care Act, the ACA’s popularity is at an all-time high, and the majority of Americans now believe that it is the federal government’s responsibility to provide health care for all Americans. This shift in sentiment suggests that a single-payer system — a “Medicare for all” — may soon be a politically viable solution to America’s health care woes.
This system has long been an aspiration of the far left, yet even the right now seems to ac [...]
Many large companies yearn to rekindle the innovative magic of entrepreneurship, but very few actually succeed. The reasons have been well documented and include:
Large, established companies answer to investors who value predictable, consistent financial results, and so are intolerant of the risks inherent in bold innovation.
Career advancement in mature companies usually demands avoiding conspicuous failures, while entrepreneurs must fail repeatedly to get ahead.
Large companies serve mainstream customers, while innovative entrepreneurs first serve early adopters.
For these reasons and mor [...]
When thinking about practical applications for artificial intelligence in your business, it’s easy to assume that you need vast amounts of data to get started. AI is fueled by data, and so it only makes sense that the more data you have, the smarter your AI gets, right? Not exactly.
When it comes to extracting intelligence by applying AI to data, context matters. In other words, you can build the biggest data lake imaginable, but if you don’t know what you’re trying to find and you don’t have the right data to do it, then you’re not going to get where you want to [...]
Dealing with today’s digital disruption begins by understanding how it differs from past industry changes. After all, stories of the end of our industry as we know it have been a trade press staple for decades. A few key elements distinguish this era of change from the past.
Disruption has accelerated dramatically, and the numbers prove it.
A 2014 study from Constellation Research quantified the accelerating rate of change in the enterprise by examining a simple benchmark — the entry and exit of U.S. corporations in the S&P 500 index.
In 1958, corporations listed in the S& [...]
At a time when many established companies are struggling to remain competitive, it’s clear that fundamental change is in order. Some established companies have found a path that works — they are surviving, thriving, and going head-to-head with an onslaught of fast-moving startups that seem to multiply overnight. What lessons have these companies learned that others need to embrace?
Digital transformation requires a new approach to strategy.
A key tenet of digital transformation is the understanding that digital strategy no longer plays a supporting role for business strategy. It is [...]
Erik Brynjolfsson, MIT Sloan School professor, explains how rapid advances in machine learning are presenting new opportunities for businesses. He breaks down how the technology works and what it can and can’t do (yet). He also discusses the potential impact of AI on the economy, how workforces will interact with it in the future, and suggests managers start experimenting now. Brynjolfsson is the co-author, with Andrew McAfee, of the HBR Big Idea article, “The Business of Artificial Intelligence.” They’re also the co-authors of the new book, Machine, Platform, Crowd: Ha [...]
Kenneth Andersson for HBR
Historically, shopping has been a sensory experience. Store associates served as personal shoppers, helping customers pick out items. Shoppers gauged quality by the look and feel of a product. They asked for sales associates’ opinions when they tried on clothes. It was as much an emotional experience as it was a physical, tactile one.
That traditional “personal touch” shopping experience is hard to replicate online. As more companies struggle to find their niche with the modern consumer, they’re turning to new technologies to recreate t [...]
For years, when I spoke with CEOs or senior leaders, it was because they were interested in how my consulting firm could help their employees become more engaged, or innovative, or sustainably high-performing. During the past year – and especially the past six months – I’ve been hearing a different and much more personal initial question: “Can you help me better manage my own life?”
Consider the challenges that modern corporate leaders — and especially CEOs — now face, in addition to running their companies every day:
A high likelihood that the compan [...]