Is the Time Right for Self-Management?

Recently it was reported that Zappos.com, the online clothing retailer, is in the process of implementing "self management" under a program called "Holacracy," a concept being adopted by several hundred other firms. Instead of being led by managers, associates along with their former managers are encouraged to define their own jobs ("energize their roles" in the language of the initiative) and form teams ("circles"). The guidelines for the effort are spelled out in a 30-page "Constitution" used as the basis for orienting associates to the new form of organizing work.

Self-management is not a new idea. For example, it was adopted at Taco Bell 25 years ago under John Martin when a long-term strategic plan was put in place that called for the company to distribute its products through more than 100,000 locations of various kinds. The 25-fold increase in the number of distribution points called for more managers than the company could possibly hire and train under then-accepted principles of multiunit retail management. As a result, the company raised the number of units for which a manager was responsible from one to ten or more. By necessity, managers could do little more than provide minimal oversight and occasional problem solving. Store associates, with some coaching, were given responsibility for hiring, training, and disciplining each other as well as such things as scheduling and cash management.

The results were remarkable.

Teams of associates worked out new methods. For example, they trained people new to their jobs during slack business hours. When the meal-time rush hit, each associate moved to a job at which he or she was most accomplished-something they called "Aces in Your Places." Within minutes productivity rose 60 percent to accommodate the rush. Sales targets were met at self-managed units, associate turnover dropped 29 percent, and customer satisfaction scores actually improved when compared to conventionally managed stores. The effort stalled only when the planned strategy was scaled down and Martin's successor halted further expansion of the initiative.

Interest in self-management was later stimulated by Gary Hamel's book, The Future of Management, in which he described innovative efforts to enable employees to define their own jobs and shape their work at companies such as Google, Whole Foods Market, and W. L. Gore & Associates, Inc. The idea may have particular appeal to Millennials who are thought to have high levels of self-confidence, non-traditional work habits, and, at least in their early careers, an interest in personal development that exceeds their desire for high wages.

Change, of course, is difficult. At Zappos, 14 percent of associates have left. Presumably, a number of these are former managers, although it's not clear what Holacracy had to do with the departures. (In anticipation of possible departures, a circle called "Reinventing Yourself" was formed at Zappos for former managers.)
Even though Zappos is only several months into the initiative, its leader, Tony Hsieh, urges patience. He is quoted as saying, "It's a gradual process. It's not a light switch."
How successful do you think the initiative at Zappos will be? Why? Regardless of its potential for success, does it and efforts like it presage an important trend? Is the time ripe for self-management? What do you think?

The Foods and Beverages Merchants in Jabodetabek Lost Their Income Until Rp 200 billion

The Foods and Beverages Merchants in Jabodetabek Lost Their Income Until Rp 200 billion

Bad weather that hit several regions in Indonesia is large enough to impact the food and beverage industry in this country. For only the Jabodetabek area, the floods predicted suppress the turnover to 25 percent.

Chairman of the Food and Beverage Association of Indonesia (Gapmmi) Adhi Lukman explained, a decrease of revenue is due to the difficulty of the distribution of products from the factory to the market because of the flooding block. Thus, it spreads on the decline in consumption.

As an overall result, Adhi estimated the food and beverage industry in Jabodetabek lost the income until Rp 200 billion per day. “In the normal situation, the income in each day for this region reached USD 800 billion,” he said on Tuesday (01/21/2014).

It is not only the distribution to the consumer, food and beverage manufacturers must also bear the losses due to the distribution of raw materials from the another region which also faltered.

For example, the transportation of fresh fruit and meat from Central Java, currently takes up to four days. Though, it usually takes only a half day. “Whereas within five days, the fresh raw materials will rot in about 50 percent” he said.

It hasn’t counted yet the losses because the factory could not be operated due to workers who could not get in because of flooding, or because there is no electricity supply due to outages by PLN in some areas.

Despite the losses is in sight, according to Adhi, manufacturers of foods and beverages will not raise their selling prices. Because this problem is only temporary.

Questions :
1. What is affects the food and beverage industry turnover decreased?
2. Who is Adhi Lukman?
3. Where is the floods predicted suppress the turnover to 25 percent?
4. When  did the interview to Adhi do?
5. Why manufacturers of foods and beverages will not raise their selling prices?
6. How much the food and beverage industry in Jabodetabek lost the income per day?

Managing the Family Business: Are Optimists or Pessimists Better Leaders?

Managing the Family Business: Are Optimists or Pessimists Better Leaders?

In general, optimists are best suited to lead family-run entrepreneurial organizations. At least until disaster strikes. John A. Davis explains why both perspectives are so valuable.

by John A. Davis

Editor's note: This is part of a series of occasional columns on managing the family business written by Senior Lecturer John A. Davis.

Optimism and pessimism are strong, stable traits that reflect our coping strategies. We live in an uncertain world. To cope with uncertainty, most people basically assume that things will either turn out well (the optimists) or turn out badly (the pessimists).

So here's a question to ponder: Is it better to have an optimist or a pessimist leading your family organization? As I'll show below, both have their own unique traits that can benefit a business. But they will do it in different ways, with different goals.

Which are you? Here's a quick test. I plunk down two magazines in front of you. One, Time, has Warren Buffet on the cover, under the headline "The Optimist." The other publication is ThePessimist.com, whose tagline is "Expecting the worst. Never disappointed." Which do you pick up first?

It's probably a good thing for us that so-called rationalists (tagline: "Why so emotional?") are in the minority, because studies show that without optimism or pessimism people don't accomplish as much. These natural traits motivate people to take action-different actions, but at least action.

Are you a pessimist?

If you're a pessimist, you tend to focus on safety and security. Pessimism drives you to seek and find safe havens, establish clear advantages, and protect resources. When pessimistic about needed economic recovery, for instance, families save money and companies build war chests. When the news is bad and likely to get worse, a pessimist is your best ally because pessimists thrive on fixing errors.

To get the most out of the pessimist in your family-owned company, researchers say, you need to provide "targeted negative feedback" from a trusted authority. Pointing out what has gone wrong or what's less than perfect will motivate the pessimist to innovate products, improve plans, and solve problems. For this reason, pessimists can make good operational leaders. But pessimists in the corner office or leading the family are less likely to foster a culture of growth, risk taking, and wealth creation.

According to Jeremy Dean, a researcher at University College London, optimists prefer to think about how they and others can advance and grow. Optimists also have larger social networks, solve problems cooperatively, and are more likely to seek help in difficult situations. They make good spouses. People with optimistic spouses were healthier in a 2014 study by researchers at the University of Michigan.1 To energize an optimist, positive feedback is absolutely essential, because the optimist builds on incremental achievements and a sense of positive movement.

Choose optimists to lead growth activities in your family organization. Entrepreneurs, for example, are much more likely to be optimists. But if you choose an optimistic business leader, you should probably pair them with "reality testers," not necessarily authority figures, advises University of Pennsylvania professor Martin Seligman, the father of positive psychology.

For decades, scientists regarded optimism and pessimism as fixed traits we are born with. But last year, researchers at a German University reported that 18-39 year-olds were more optimistic than people 40-64, and far more than people 65 and older.2 For reasons we don't fully understand but can appreciate, life experience turns some people into pessimists. By the way, the same study of 40,000 people also found that grumpy people live longer. Their caregivers? You guessed it: Optimists.

Use the power of both traits

Leaders, whatever their orientation, need to learn to harness the power of both traits. "In a striking turnaround," writes Annie Murphy Paul in Psychology Today, "science now sees optimism and pessimism not as good or bad outlooks you're born with but as mindsets to adopt as situations demand."

When testing strategic plans, deploy defensive pessimism, imagining all the things that can go wrong in the future. But when the task requires flexibility and had work toward uncertain goals, build teams with optimists.

As a determined optimist who has grown a bit more pessimistic during my life, I do want to share one important finding from my 35 years of field research: Effective long-term planning and investment requires an optimistic approach, with contingency planning by pessimists—because things never go exactly as you want them to