Using Beer and Spouses to Foster Innovation

THE WALL STREET JOURNAL—Small businesses inevitably face bigger, better-funded rivals that can outspend them in almost every area. To keep up, companies at the Top Small Workplaces conference say they have to innovate constantly — and that often means tapping into employees’ ideas.

Surveys are a popular option — companies administer them anonymously, to find out what employees really think. One company, New Media Strategies Inc., enlists a team of volunteers to sift through the survey results so the opinions and ideas reach a broader group than the top executives.

Other popular ideas: family events that allow spouses and kids to offer ideas. A couple of beers may help lubricate and accelerate that process, note chief executives. Read article.

Dealing with the ‘Irrational’ Negotiator

HARVARD BUSINESS SCHOOL—What do you do when the people with whom you are negotiating act in ways that can best be called counterproductive? Before throwing up your hands, take a deep breath and ask yourself 3 questions. Do these people lack good information? Are they operating with constraints you don’t know about? Are they holding onto hidden interests?

According to Deepak Malhotra and Max H. Bazerman, chances are the main hurdle to smooth negotiation is behind 1 of these 3 questions. When you label someone “irrational,” you limit your own options, as they write in Negotiation Genius: How to Overcome Obstacles and Achieve Brilliant Results at the Bargaining Table and Beyond. The following excerpt describes strategies and tactics to overcome another party’s counterproductive behavior and keep the deal on track.

These are ideas that anyone can put to use in multiple settings of business. As Malhotra and Bazerman observe, negotiation geniuses are made, not born. “What appears to be genius actually reflects careful preparation, an understanding of the conceptual framework of negotiation, insight into how one can avoid the errors and biases that plague even experienced negotiators, and the ability to structure and execute negotiations strategically and systematically.” Read article.

Coca-Cola’s Global Rethink

HARVARD BUSINESS ONLINE—Why do I think globaloney is potentially dangerous to your health rather than just a useful simplification or call to arms? Probably the best example I can think of was Coca-Cola, which a decade ago, in the waning days of CEO Roberto Goizueta’s reign, was acclaimed as the aggressively globalized corporation. Goizueta emphasized that the distinction between international and domestic no longer applied (which he embodied in organizational changes), set aggressively high growth targets, focused on a handful of megabrands to drive volume growth, and engaged in an unprecedented amount of centralization and standardization.

Ten years later, under CEO Neville Isdell, Coke has executed an about-face. Isdell has separated out the domestic and international organizations and cut growth targets by half, to the cheers of analysts who had come to regard the earlier ones as unrealistic. The emphasis now falls on variety, with particular push to learn from Japan, Coke’s most profitable major market and one in which it has a particularly broad array of products, ranging from best-selling Georgia Coffee to offerings such as Real Gold, a hangover cure, and Love Body, a tea that some believe increases bust sizes. And the emphasis on variety carries over from products to strategies: in China and India, in particular, Coke has lowered price points, reduced costs by indigenizing inputs and modernizing bottling operations, and upgraded logistics and distribution, especially in rural areas. Read article.

How 2 Guys’ Iowa Connection Took Big Telecoms for a Ride

THE WALL STREET JOURNAL—Two-and-a-half years ago Ron Laudner was the anxious owner of a rural phone company serving this tiny town, where Main Street was emptying out as restaurants and other businesses disconnected their phones and moved to busier commercial districts.

More than 1,800 miles away, David Erickson was running a Web-based conference-calling business in Long Beach, Calif., shopping around for phone companies to be his partners.

In mid-summer 2005 this unlikely duo struck a deal. They routed millions of minutes of Mr. Erickson’s conference calls through the switches of Mr. Laudner’s Farmers Telephone of Riceville. To do it, they used outdated federal regulations to charge telecom companies such as AT&T Inc. and Verizon Communications Inc. steep rates and collected huge profits at their expense. Together, the two made hundreds of thousands of dollars. Soon, Mr. Laudner cut other deals to generate even more traffic.

“I’m not going to argue I didn’t think it was amazing,” Mr. Laudner says.

But the big phone companies had another term for it. “Verizon is not going to stand by while irresponsible companies use this traffic-pumping scheme to overcharge our company,” says Tom Tauke, vice president of public affairs, policy and communications for Verizon. Read article.

Greater Flexibility Advised for Logos and Branding

INTERNATIONAL HERALD TRIBUNE—Last spring, the organizers of the 2012 Summer Olympics in London experienced an unwanted, if short-lived, furor over their choice of logo. The symbol was described in the British press as a “broken swastika,” among other things.

While the shape of the logo drew the most derision, some critics were also appalled that it could be adapted by Olympic sponsors, who will be permitted to put their own brand symbols or colors into the 2012 emblem, in effect creating logos within the Games’ logo.

In the buttoned-down world of corporate branding, that seemed like a no-no. Companies employ armies of executives to make sure the color, shape and placement of a logo never varies. Share it with another brand? No way.

But Wolff Olins, the firm that created the 2012 design, thinks that brands need to loosen up.

“In the past, corporate identity was about control and consistency,” said Karl Heiselman, chief executive of Wolff Olins, which is part of Omnicom Group. “With too much control, what happens is that people forget about the content.”

Wolff Olins, which has offices in London and New York, has designed logos for other clients, including New York City and the New Museum of Contemporary Art in New York, that are intended to be used in a flexible way – as “containers” for content, according to Heiselman. Read article.

Whose Company Is It Anyway?

THE WALL STREET JOURNAL—“What do you think this is, a democracy?” When it comes to decision making at employee-owned companies, the question isn’t necessarily a sarcastic comeback. Given an often greater degree of employee input, the process can lead to confusion over roles and responsibilities if it isn’t managed well.

If you’re looking for ways to teach employee shareholders about your company’s decision-making process, you may want to check out this quick reference guide: “Rights, Roles and Responsibilities of Decision Making.”

Reflexite Corp., an employee-owned company in Avon, Conn., developed the handout for its employee owners to clarify whom is responsible for making what kind of decisions. Read article.

How the Philippines Shoots Itself in the Foot

THE ECONOMIST—THINGS have been going pretty well for the Philippines recently. For the first time since the 1970s its economy has grown by at least 5% in each of the past three years. This year it may grow almost 7%, aided by a boom in exports, especially to China.

Inflation has fallen in recent years, while tax reforms have improved the government’s finances. May’s congressional elections were fairly peaceful (especially in light of the country’s turbulent history), raising hopes for political stability. All this has prompted analysts who had written off the country as a basket case to take a fresh look.

But a political scandal has erupted over a dubious telecoms deal that President Gloria Macapagal Arroyo’s government struck with China, reminding investors why they tend to avoid the Philippines. Read article.

Infectious Leadership

HARVARD BUSINESS ONLINE—For good or ill, the senior leadership of every organization is infectious. By this I mean that leaders’ behaviors tend to be transmitted to their direct reports, who pass them on to the next level, and so on down through their organizations. Over time, they permeate the organization from top to bottom, influencing activity at all levels. Eventually they become embodied in the organizational culture, influencing the types of people who get promoted and hired into the organization, creating a self-reinforcing feedback loop — either positive or negative.

The idea that senior leader behavior is truly viral became clear to me when I was doing organizational change consulting for the CEO of a manufacturing company in the mid-1990s. Facing aggressive competition, the business was in dire need of adopting a new generation of technology and moving to team-based production methods. Doing so required breaking down barriers between functions in manufacturing, as well as retraining the unionized workforce. Read article.

Harnessing the Power of Informal Employee Networks

MCKINSEY QUARTERLY—In any professional setting, networks flourish spontaneously: human nature, including mutual self-interest, leads people to share ideas and work together even when no one requires them to do so. As they connect around shared interests and knowledge, they may build networks that can range in size from fewer than a dozen colleagues and acquaintances to hundreds. Research scientists working in related fields, for example, or investment bankers serving clients in the same industry frequently create informal—and often socially based—networks to collaborate.

Most large corporations have dozens if not hundreds of informal networks, which go by the name of peer groups, communities of practice, or functional councils—or have no title at all. These networks organize and reorganize themselves and extend their reach via cell phones, Blackberries, community Web sites, and other accessories of the digital age. As networks widen and deepen, they can mobilize talent and knowledge across the enterprise. They also help to explain why some intangible-rich companies, such as ExxonMobil and GE, have increased in scale and scope and boast superior performance.

As we studied these social and informal networks, we made a surprising discovery: how much information and knowledge flows through them and how little through official hierarchical and matrix structures. Read article.

Virtually Clean

THE ECONOMIST—Hacking used to be done by kids for kicks or bragging rights. Nowadays, it’s big business for organised crime, often out of reach of the law, on the far side of the world. Connect an unprotected personal computer to the internet for more than 15 seconds and it will almost certainly be attacked by a virus or worse. That’s how ruthlessly effective the army of malicious robots, dispatched by criminals to scour the net for vulnerable computers, has become.

Security firms reckon some 2.3m “bots” are currently on the prowl. While suppliers of anti-virus (A-V) software have every reason to magnify the claim, the fact remains that only four out of five computers connected to the internet have A-V software installed. And less than half those have their software bang up to date. Read article.

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