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I Admire Business Leaders Who’re Frugal to an Extreme

October 4, 2018 By Nagesh Belludi Leave a Comment

Business folks are rarely frugal, especially when they’re on their clients’ dime or using nameless stockholders’ funds.

I admire businesspeople and companies that are frugal to an extreme and are obsessed with reducing waste. Here are three prominent examples of leaders who’ve successfully inculcated frugality in their companies’ cultures.

Walmart founder Sam Walton was famously frugal and lived a humble life right up until his death. He drove a red 1985 Ford pickup and said, “What am I supposed to haul my dogs around in, a Rolls-Royce?” On business trips, Walton required Walmart’s buyers to lodge two to a hotel room, eat in family diners, and even bring pens from the hotel rooms for use at “home office.” One of their travel goals was to limit expenses to less than 1% of their purchases. Walmart did not have a corporate jet until they had $40 billion in sales. Walton wrote in his biographical Made in America: My Story (1992; my summary,) “A lot of what goes on these days with high-flying companies and these overpaid CEO’s, who’re really just looting from the top and aren’t watching out for anybody but themselves, really upsets me. It’s one of the main things wrong with American business today.”

Amazon is obsessed with reducing waste. From the very beginning, founder Jeff Bezos built a company focused on providing value in terms of prices and customer service. A micromanager, Bezos audited all corporate expenses when the company was much smaller and reproved everything not warranted for delivering value to customers—no first-class travel for executives, no color printers, office desks made from wooden doors, etc.

Thriftiness is at the heart of the Brazilian private-equity group 3G’s operating model. 3G is notorious for pressing the zero-base budgeting method of cutting operating costs at companies it acquires. Julie MacIntosh’s Dethroning the King (2010) has an interesting story about 3G-run InBev CEO Carlos Brito‘s first visit to Anheuser-Busch’s St. Louis headquarters after InBev purchased the American brewer in 2008:

To honor Brito’s visit and pay him the respect it felt he deserved as the soon-to-be new chief, Anheuser-Busch arranged for him to stay in a suite at the cushy Ritz-Carlton. The Ritz wasn’t Brito’s style, though, especially since he was just about to start indoctrinating Anheuser-Busch’s staffers to InBev’s frugal way of life. He had flown commercial into St. Louis from New York’s LaGuardia Airport.

He had someone call back and say, “No, no no, I’ve already reserved a room at such and such a place—like the Holiday Inn,” said one InBev insider. “I think that’s when it probably, for the first time, hit home in St. Louis that things were going to be different.” Rather than hitching a town car or helicoptering in to Anheuser-Busch headquarters from his hotel on Tuesday morning, Brito accepted a ride from [Anheuser-Busch President] Dave Peacock.

While on the subject of leaders and indulgence, I’d like to mention private jets, those symbols of corporate indulgence. Corporate jets were famously ridiculed when the CEOs of General Motors, Ford, and Chrysler flew them to Washington DC to seek government bailouts in 2008. General Electric’s former CEO Jeff Immelt’s was disparaged recently for flying around the world with a needless “backup jet” in case something happened to the corporate plane he was using. But a corporate jet isn’t an indulgence for a big company, it is a business necessity. Having used corporate jets during a previous job, I can swear that flying commercial is relatively counterproductive and costly. In the 1990s, Warren Buffett, the poster boy of thriftiness, reluctantly bought a private plane. He christened it “The Indefensible,” but within a few years, renamed it “The Indispensable.”

Our 10 Most Popular Articles of 2017

January 3, 2018 By Nagesh Belludi Leave a Comment

Top Blog Articles of 2017 Here are our most popular exclusive features of 2017.

Pass this on to your friends; if they like these, they can sign up to receive our RSS feeds or email updates.

Zeigarnik Effect: How Incomplete Tasks Trigger Stress. Unresolved and interrupted tasks thieve the attention of your brain until you have a clear—if subconscious—proposal of what you’re going to deal with them. Just the simple act of capturing a task that reaches your head can achieve that sense of completion.
Lessons on Adversity from Charlie Munger: Be a Survivor, Not a Victim. Berkshire Hathaway’s Vice-Chairman overcame “horrible blows, unfair blows” on the road to success. Munger counsels, “Feeling like a victim is a perfectly disastrous way to go through life.” Don’t operate life on the assumption that the world ought to be fair, just, and objective. You are neither entitled nor unentitled to good treatment.
How to Guard Against Anger Erupting. The most effective way to deal with anger in yourself is by not disregarding or repressing it. When anger rises past a threshold, it requires a reasonable and pleasing expression—an outlet—to be diffused. The key to expelling anger in a way that must feel good and fair is to invoke your calm, wise self and put out some of the fire of the emotion before moving forward.
Why People to Act Immorally and Justify Their Unprincipled Behavior. People can rationalize behavior that is at odds with their own moral principles. When people feel angry, pressured, or depressed, their mental footing tends to ebb away. They are more likely to engage in self-absorbed behaviors that they would otherwise spurn, especially if the payoff for such behavior is high and the odds of getting caught and punished are low.
Rewards and Incentives Can Backfire. Offering rewards for motivating people to do unlikable tasks could sometimes become counterproductive. In what psychologists call “the overjustification effect,” a reward, instead of motivating, could fortify a person’s revulsion for the task. In other words, the reward could reinforce the belief that the task can’t be worth doing for itself.
Choose Your Role Models Carefully. The modern world has a dangerous problem with hero-worship—pop artists, rappers, film stars, sportspersons, capitalists, and so on command attention and affection as never before. While admiring, and drawing wisdom, meaning, and inspiration from heroes can be constructive, you must take “hero narratives” with a grain of salt. Don’t blindly place much faith in today’s experts and celebrities.
Expressive Writing Can Help You Heal. People often block out thoughts that provoke negative emotions as a way of reducing their stress and regulating their moods. By exploring your deepest thoughts and feelings with a reflective, inquiring, honest attitude, you can shift perspective. Standing back and reflecting on your suffering from different points of view can bring about an improved emotional state.
Twenty Reasons People Don’t Change. If you have trouble getting people to change, perhaps one—or more—of these twenty reasons are to blame. Be realistic about changing others’ hearts and minds. If you can learn to accept them for who they are and let go of your conceptions of their perfection, your relationships become richer.
The More You Can Manage Your Emotions, the More Effective You’ll Be. People who lack the capacity to withstand psychological distresses such as anger, fear, frustration, and sadness are at a marked disadvantage in life. When faced with life’s unceasing challenges, they engage in destructive behaviors, often with verbal and physical aggression toward themselves and others.
Six Powerful Reasons to Eat Slowly and Mindfully. Cultivate a healthy relationship with food. Dedicating time to eat slowly, mindfully, and intentionally—and enjoying the pleasure of food—can make an enormous difference in your diet and health.

And here are articles of yesteryear that continue to be popular:

See our top 10 lists for 2016 and 2015.

How to Handle Conflict: Disagree and Commit [Lessons from Amazon & ‘The Bezos Way’]

May 5, 2017 By Nagesh Belludi 1 Comment

How Amazon’s Jeff Bezos Propels Innovation

Amazon’s founder and CEO Jeff Bezos once remarked that it takes five to seven years before the innovation seeds that Amazon plants flourish enough to have a significant impact on the economics of the business.

Since its founding in 1994, Amazon has made endless investments in expanding its business models. It has successfully used its money-making ventures to bankroll explorations into peripheral lines of business. Many of its capital allocation decisions haven’t yielded strong profits; yet, Amazon has flourished beyond everyone’s expectations and its growth potential is undeniable.

Central to this innovation strategy has been Bezos and his leadership team’s foresight, early commitment, and stubborn confidence in the prospect of R&D. Under Bezos’s direction and long-term focus, Amazon still operates as a founder-driven start-up in several major areas.

Bezos has a compelling cultural influence and has institutionalized his distinctive entrepreneurial mindset across the company. His core values are codified as Amazon’s 14 Leadership Principles, one of which is “Have Backbone; Disagree and Commit”:

Leaders are obligated to respectfully challenge decisions when they disagree, even when doing so is uncomfortable or exhausting. Leaders have conviction and are tenacious. They do not compromise for the sake of social cohesion. Once a decision is determined, they commit wholly.

“Disagree and Commit”

Jeff Bezos’s latest short-but-compelling annual letter to his shareholders contains pearls of wisdom on leadership, management, and teamwork. Read the letter; it won’t take long.

Speaking about high-velocity decision making in an ingenious culture, Bezos says he encourages Amazon’s leaders and employees to use the phrase “disagree and commit” to disagree respectfully and experiment with ideas:

Use the phrase “disagree and commit.” This phrase will save a lot of time. If you have conviction on a particular direction even though there’s no consensus, it’s helpful to say, “Look, I know we disagree on this but will you gamble with me on it? Disagree and commit?” By the time you’re at this point, no one can know the answer for sure, and you’ll probably get a quick yes.

This isn’t one way. If you’re the boss, you should do this too. I disagree and commit all the time. We recently greenlit a particular Amazon Studios original. I told the team my view: debatable whether it would be interesting enough, complicated to produce, the business terms aren’t that good, and we have lots of other opportunities. They had a completely different opinion and wanted to go ahead. I wrote back right away with “I disagree and commit and hope it becomes the most watched thing we’ve ever made.” Consider how much slower this decision cycle would have been if the team had actually had to convince me rather than simply get my commitment.

Note what this example is not: it’s not me thinking to myself “well, these guys are wrong and missing the point, but this isn’t worth me chasing.” It’s a genuine disagreement of opinion, a candid expression of my view, a chance for the team to weigh my view, and a quick, sincere commitment to go their way. And given that this team has already brought home 11 Emmys, 6 Golden Globes, and 3 Oscars, I’m just glad they let me in the room at all!

Bezos’s “fail-and-learn” refrain echoes what he wrote on risk-taking in Amazon’s first annual shareholder letter in 1997: “Given a 10 percent chance of a 100-times payout, you should take that bet every time … Failure and invention are inseparable twins. To invent you have to experiment, and if you know in advance that it’s going to work, it’s not an experiment.” That letter has become Amazon’s manifesto on the benefits and methods to long-term thinking and Bezos quotes that letter in every year’s annual letter.

To “disagree and commit” compels people to step out of their comfort zones and to sincerely commit to a project’s success. There is no room for sabotage and disruption—neither can people wait in the wings to exclaim “I told you so.” To “disagree and commit” is to be willing to take prudent risks by acknowledging that others may have diverse beliefs, approaches, ideas, and styles.

Idea for Impact: Embrace Failure because it Leads to Innovation

Many people want to be curious, creative, and experimental—they like to take initiative and investigate new products and solutions. But, when facing difficult choices, they’re naturally afraid of what they don’t know. Self-doubt sets in. They resort to safe and predictable processes. This mindset stifles the very inventive approach they want to apply and foster.

Fear of failure and self-doubt are not usually rooted in facts. They’re emotional. Don’t let this emotion make you play it safe. Don’t overthink your way out of challenges. Understand the types and amounts of risks that are acceptable to you. When facing the prospect of failure, you’re more likely to get unstuck by trying low-risk actions. Experiment. Fail. Learn. Innovate.

Success may instill confidence, but failure imparts wisdom.

Books I Read in 2016 & Recommend

December 27, 2016 By Nagesh Belludi Leave a Comment

Personal Finance: Thomas Stanley and William Danko’s The Millionaire Next Door summarizes anthropological research from the ’90s on the attributes of unassuming wealthy Americans. The authors discuss the fancy trappings of affluence and the high cost of maintaining social status. They explain that prosperous individuals prioritize financial independence over a high social status. Key takeaway: It’s easy to get rich by living below your means, efficiently allocating funds in ways that build wealth, and ignoring conspicuous consumption. {Read my synopsis in this article.}

Decision-Making / Problem-Solving: Dan Ciampa’s Taking Advice offers an excellent framework on the kind of advice network you need on strategic, operational, political, and personal elements of your work and your life. Taking Advice offers important insights into a seemingly obvious dimension of success, but one that’s often neglected, poorly understood, or taken for granted. {Read my synopsis in this article.}

Creativity / Decision-Making / Teamwork: Edward de Bono’s Six Thinking Hats describes a powerful problem-solving approach that enriches mental flexibility by encouraging individuals and groups to attack an issue from six independent but complementary perspectives. Key takeaway: The ‘Six Thinking Hats’ method can remove mental blocks, organize ideas and information, foster cross-fertilization, and help conduct thinking sessions more productively than do other brainstorming methods. {Read my synopsis in this article.}

Presentation / Communication: Edward Tufte’s The Cognitive Style of PowerPoint argues that presentations reduce the analytical timbre of communication. In other words, presentation slides lack the resolution to effectively convey context, “weaken verbal and spatial reasoning, and almost always corrupt statistical analysis.” Tufte contends that, by forcibly condensing our ideas into bullet point-statements, phrases, and slides, we break up narrative flow and flatten the information we’re trying to convey. Key takeaway: Well-structured and succinct memos can convey ideas comprehensively, clearly, and meaningfully. {Read my synopsis in this article. Also, learn about Amazon’s ‘Mock Press Release’ discipline and Procter & Gamble’s ‘One-Page Memo’ practice to communicate ideas.}

Happiness / Relationships: Janice Kaplan’s The Gratitude Diaries. For one year, Kaplan maintained a gratitude journal and wrote down three things that she was thankful for each day. She also decided to “find one area to focus on each month—whether husband, family, friends, or work—and … see what happened when I developed an attitude of gratitude.” Key takeaway: A grateful heart is a happy heart. Stop whatever you’re doing, take stock of your blessings, and be grateful for everything you have in life. {Read my synopsis in this article.}

Psychology: Viktor Frankl’s Man’s Search for Meaning. When subject to brutal treatment at Nazi concentration camps in Germany, Frankl changed his initial reaction from ‘Why me?’ and ‘Why is this happening?’ to ‘What is life asking of me?’ Such profound shifts in thinking, Frankl argues, could help you find meaning in life, regardless of what is happening on the outside. Key takeaway: The one power you have at all times is the freedom to choose your response to any given set of circumstances. Uncover a sense of purpose in life and you can survive nearly anything. {Read my synopsis in this article.}

Psychology: John Tierney and Roy Baumeister’s Willpower: Rediscovering the Greatest Human Strength. The book’s central theorem is the much-debated “muscle metaphor” of self-control, which states that willpower is like a muscle that tires out—or runs out of energy—as you use it, but can be replenished and purposely fortified through practice. Key takeaway: Budget your willpower and spend it where and when you need it the most. Eliminate distractions, temptations, and unnecessary choices. {Read my synopsis in this article.}

Biography / Leadership: Sam Walton’s Made in America is the Walmart founder’s very educational, insightful, and stimulating autobiography. It’s teeming with Walton’s relentless search for better ideas learning from competitors, managing costs and prices to gain competitive advantage, asking incessant questions of day-to-day operations, listening to employees at all levels of Walmart, and inventing creative ways to foster an idea-driven culture. Takeaways: ten rules of management success, learning from failure, cost and price as a competitive advantage, and Walton’s ‘Ten-Foot Rule’ to become more likeable.

Biography / Leadership: Deborrah Himsel’s Beauty Queen: Inside the Reign of Avon’s Andrea Jung offers an insightful tale of the spectacular rise to the top and the tumultuous fall from grace of the former Avon CEO. Jung initially led six consecutive years of double-digit growth and then presided over a series of operational missteps that led to her resignation. “Her story is a cautionary tale, one that suggests the critical importance of being aware of your weaknesses and how they can sabotage you.” Key takeaway: Spectacular success, especially those attributable to external circumstances, can often conceal on organization’s or an individual’s flaws. When the tide turns, the deficiencies are exposed for all to see. {Read my synopsis in this article.}

Biography / Leadership: David Packard’s The HP Way recalls how Bill Hewlett and David Packard built a company based on a framework of principles and the simplicity of management methods. In addition to their technical innovations, Bill and David established many progressive management practices that prevail even today. Starting in the initial days, the HP culture that Bill and David engendered was unlike the hierarchical and egalitarian management practices that existed at other corporations of their day. Key takeaway: The essence of the “HP Way” was a strong and clear set of values, and a culture of openness and respect for the individual. {Read my synopsis in this article. Also learn about management by walking around and Bill Hewlett’s ‘Hat-Wearing Process’ for decision-making.}

Leadership: Warren Bennis and Robert Thomas’s Geeks and Geezers. The authors posit that all potential leaders must pass through a “leadership crucible” that provides an intense, transformative experience. Only after they “organize the meaning” and draw significant lessons from their “crucible experiences” can they become leaders. Key takeaway: Find your “leadership voice” by reflecting on transformative experiences in your life and examining what you’ve learned from them. {Read my synopsis in this article.}

Look at my articles on how to process a pile of books that you can’t seem to finish, and on how self-help books bring hope that change is possible.

Also, see a list of books I read in 2015 and 2014 and recommend.

How to Increase Your Likeability: The 10/5 Rule

December 16, 2016 By Nagesh Belludi Leave a Comment

The 10/5 Rule, also known as the “Zone of Hospitality Rule,” is a well-known guiding principle for extending courtesy to customers in the hospitality, healthcare, retail, and other service industries. The rule instructs,

Whenever a staff member is within ten feet of a guest, the staff member must make eye contact and smile to greet the approaching guest.
When a staff member is within five feet of a guest, the staff member must also look the guest in the eye and acknowledge him/her with a salutation such as “Hello” or “Good Morning, Mrs. Smith.”

Many companies have adapted versions of the 10/5 Rule to improve friendliness, customer-service, and responsiveness. As I’ve written in a previous article, Walmart’s iconic founder Sam Walton instituted the ‘Ten-Foot Attitude’ and said, “… I want you to promise that whenever you come within 10 feet of a customer, you will look him in the eye, greet him, and ask him if you can help him.” At Disney theme parks, “cast members” are encouraged to make eye contact, smile, greet, and welcome each guest as part of Disney’s famous “Seven Service Guidelines.”

Courtesy is an Influence Technique

As expounded in Dale Carnegie’s classic self-help book How to Win Friends & Influence People, we are much more likely to feel warmly toward any person who sincerely makes us feel good about ourselves.

Likeable people not only succeed in their personal relationships, but also tend to be more successful at the workplace. Indeed, highly competent but unlikeable employees do not thrive as well as their moderately competent but more likeable peers.

Idea for Impact: Be courteous. Even simple acts of courtesy (making eye contact, smiling more, listening, showing sincere interest in others, for example) work as an influence technique because folks are much more likely to do things for—and accede to requests from—people they perceive as likeable.

Adapt to Your Boss’s Style: Cases from Andy Grove and Steve Ballmer’s Expectations in Meetings

November 25, 2016 By Nagesh Belludi Leave a Comment

Andy Grove’s Meeting Style at Intel

Intel’s former Chairman and CEO Andy Grove (1936–2016) was known for his brash management style. He habitually resorted to fear as a management technique. In an effort to aggressively pursue the right answers, he devoted his focus to facts and data, as I wrote in my article on lessons from the Intel Pentium integer bug disaster.

In meetings, Grove expected his employees to be self-willed, clear-sighted, and obstinate. Grove wrote in his autobiography / management primer Only the Paranoid Survive (1996,) “Don’t sit on the sidelines waiting for senior people to make a decision so that you can later criticize them over a beer.”

With an “in-your-face” interpersonal style, Grove bellicosely challenged his interlocutors and called his meetings “constructive confrontations.” In contrast, his executives recalled them as “Hungarian inquisitions” in reference to his childhood in Hungary under Nazi and Communist regimes.

Recalling Grove’s technique for meetings, one executive said, “If you went into a meeting, you’d better have your data; you’d better have your opinion; and if you can’t defend your opinion, you have no right to be there.” In pursuit of accuracy and rationality, Grove would rip his employees’ ideas to shreds even while they were still on the first page of their carefully prepared presentations.

Steve Ballmer’s Meeting Style at Microsoft

Another case in point is how Steve Ballmer conducted meetings. For most of his career as Microsoft’s CEO, Ballmer expected his employees to deliver a presentation he hadn’t seen before, take the “long and winding road” of discovery and exploration, and then arrive at the conclusion. This allowed Microsoft employees to expose Ballmer analytically to all their contemplations and postulations before steering him to their conclusions.

Years later, Ballmer reflected that this meeting style wasn’t efficient because, as a high-energy person, he couldn’t bear longwinded narratives and grew impatient for the conclusions. Ballmer changed his expectations of meetings and required employees to send him the presentation materials in advance. He would read them and directly venture into questions, asking for data and supporting evidence only if needed. This gave him greater focus in meetings.

Idea for Impact: Attune to Your Boss’s Communication Style

As I’ve discussed in previous articles, your ability to work well with others can mean the difference in whether your career progresses or stalls. To advance professionally, it’s particularly important that you have a good working relationship with your immediate supervisor.

Bosses, like all people, differ greatly in their capacities and communication styles. You and your boss may be reasonably compatible or you may have entirely different communication preferences, temperaments, and styles. Regardless, you need to achieve a beneficial and cordial way of working with your boss.

Invest time and energy in understanding how your boss works, her ambitions and goals, her priorities, her strengths and weaknesses, the specificity she expects from your projects and decisions, her hot buttons, and her flash points.

Accommodate your boss’s work style. Discuss communication preferences and seek feedback. Be flexible. Ask questions to clarify what you don’t understand.

Silicon Valley’s Founding Fathers // Book Summary of David Packard’s “HP Way”

August 9, 2016 By Nagesh Belludi Leave a Comment

David Packard’s The HP Way recalls how he and Bill Hewlett started one of the world’s most successful corporations in 1937 with just $538 (today’s $8,850 when adjusted for inflation) and a rented one-car garage in Palo Alto, California. That garage is recognized today as the birthplace not only of Silicon Valley, but also of a new management approach.

Bill and David first met as electrical engineering students at Stanford University. Despite their different dispositions, they shared a passion for the outdoors and, with a professor’s encouragement, started Hewlett-Packard (HP) to commercialize the latest “radio engineering” theories. Over the decades, HP invented many groundbreaking electrical gadgets that were crucial to the development of radars, instrumentation devices, computers, and other technological revolutions.

In addition to their technical innovations, Bill and David established many progressive management practices that prevail even today. Starting in the initial days at the garage, the culture that Bill and David engendered at HP was unlike the hierarchical and egalitarian management practices that existed at other corporations of their day.

The essence of the “HP Way” was openness and respect for the individual. (Bill Hewlett once sawed a lock off a tool-room cabinet and left a note, “HP trusts its employees.”)

Management by objectives, managing by wandering about, nursing-mother facilities, flextime, decentralization, intrapreneurship, catastrophic medical insurance, profit sharing, employee stock ownership, tuition assistance, and many other management principles that dominate human resources practices today were all pioneered—if not invented—at HP.

Recommendation: Read. The HP Way tells the story how Bill and David built a company based on a framework of principles and the simplicity of their management methods. Good to Great author Jim Collins once wrote in commending David Packard’s The HP Way, “The greatest lesson to be divined from this book isn’t so much how to create a similar company but how creating a company based on a strong and clear set of values can lead to outstanding success.”

Postscript: Notes from ‘The HP Way’

Like Sam Walton, the other illustrious entrepreneur of their generation, Bill and David grew up witnessing Americans’ hardships during the Great Depression. This made them risk-averse; they vowed never to incur long-term debt to expand their fledgling company.
On the day Hewlett-Packard went public in 1961, David Packard took a subway instead of a taxi to Wall Street, lost his way, and reached the New York Stock Exchange late.
The foundations that Bill Hewlett and David Packard established individually with 95% of their stakes in HP are today two of the most prominent philanthropies in America.

Five Principles of Career Success from Intel’s Andy Grove

June 28, 2016 By Nagesh Belludi Leave a Comment

Andy Grove (1936–2016,) the illustrious cofounder and CEO of Intel, passed away earlier this year. Grove was arguably the most influential tech executive the Silicon Valley has ever seen. He achieved fame and success in his adopted country and provides an outstanding modern-day immigrant success story.

Modern-Day Immigrant Success Story

Born András István Gróf to a middle-class Jewish family in Hungary, he survived the Nazi occupation by taking a false name, hiding with Christian families, and escaping the heartbreaking fate of half a million Hungarian Jewish people. After the war, when the Russians occupied Hungary and installed a repressive Communist government, Grove’s father was forced to take up menial work despite having been emaciated from torture at a Nazi labor camp.

During the brutal response to the anti-Soviet 1956 Hungarian Revolution following Stalin’s death, Grove’s family hid themselves in a coal cellar whilst Soviet artillery shells destroyed their neighborhood. Grove joined a flood of people who took advantage of the pandemonium to walk across the border into Austria. He fled to the United States in 1957, arrived in New York with less than $20 in his pocket, and settled in with relatives.

As a child, Grove was afflicted with scarlet fever and an ear infection that left him nearly deaf. In spite of his hearing impairment and an inadequate knowledge of English, he studied chemical engineering at the City College of New York and graduated at the top of his class. Grove learned to lip read and then deciphered his notes after class. He recalled to The New York Times in 1960, “I had to go over each day’s work again at night with a dictionary at my side.” He then earned a Ph.D. in chemical engineering at Berkeley and joined Fairchild Semiconductor. When his managers Gordon Moore and Robert Noyce left Fairchild to start Intel, Grove went with them as director of engineering.

High Performance Management and Paranoia

Intel evolved swiftly. As President and later CEO, Grove brilliantly led Intel’s strategy and operations, established a near-monopoly on CPUs, and played a central role in the PC revolution. During this tenure as CEO from 1987–98, Intel’s stock price rose 32% a year. After relinquishing his role as Intel’s CEO in 1998 and as Chairman of the Board in 2005, he mentored prominent Silicon Valley entrepreneurs.

Grove was famous for his rigorous, no-nonsense, confrontational, non-hierarchical management style; his approach still dominates the Silicon Valley culture. He zealously demanded high performance. In 2004, the Wharton School him the most influential business leader of the past quarter-century, over Microsoft’s Bill Gates, General Electric’s Jack Welch, and Walmart’s Sam Walton.

Grove was a conspicuous voice for reason in the immigration, offshoring, and jobs-creation debates. He was also a prolific author and public speaker. His autobiography Swimming Across (2001) recounts the first 20 years of his life—from childhood in Hungary up until his move to California. His other autobiography, Only the Paranoid Survive (1996,) describes how companies should deal with emergent competitors, transform themselves, and perhaps change the nature of the industry itself. Forbes magazine calls it “probably the best book on business written by a business person since Alfred Sloan’s My Years with General Motors.” High Output Management (1995) explained how to maximize productivity and has become a cult classic in Silicon Valley. One on One with Andy Grove (1988) compiles his “Dear Abby”-style newspaper Q&A column on work- and career-advice.

Five Principles of Career Success

Wrapping up One on One, Grove summarized his advice on career, management, and leadership with five suggestions:

FIRST—and this is very important—enjoy your work. It’s impossible to like all of it. Sometimes you’ll chafe under its unrelenting nature, other times you’ll be bored, but overall you must enjoy it. I am convinced that most people will like their work if they can see that what they do makes a difference and if they approach their work with a bit of zest, maybe even playfulness. Doing so introduces a bit of levity when it’s most needed and leads to camaraderie.

SECOND, be totally dedicated to the substance of your work, to the end result, the output; not how you got to it or whose idea it was or whether you look good or not.

THIRD, respect the work of all those who respect their own work, from vice presidents to sales clerks, from maintenance technicians to security officers. Nobody is unimportant: It takes all levels and all jobs to run a functioning organization.

FOURTH, be straight with everyone. I hate it when people are not honest with me, and I would hate myself if I weren’t straight with them. This isn’t an easy principle to stick to. There are always many reasons (better to call them excuses) to compromise a little here or there. We may reason that people are not ready to hear the truth or the bad news, that the time isn’t right, or whatever. Giving in to those tempting rationalizations usually leads to conduct that can be ethically wrong and will backfire every time.

And, ALWAYS, when stumped, stop and think your way through to your own answers!

Self-Assessment Quiz: Are You A Difficult Boss?

April 12, 2016 By Nagesh Belludi Leave a Comment

If you answered “yes” to any of the following questions, you need to reflect on and adjust your management style.

Do you give employees more critical feedback than appreciation, compliments, and positive feedback?
Do you undercut praise with criticism? In other words, do you deliver criticism with praise in the form of a “feedback sandwich,” undermine the positive impact of praise, and weaken the significance of the corrective feedback?
Do you give unfeasible or contradictory orders? For example, do you fail to give employees enough resources, time, and direction to get a job done?
Do you play favorites?
Do you reward “yes” people?
Do you avoid taking responsibility for your mistakes?
Do you focus on assigning blame and finding fault instead of fixing a problem?
Do you set deadlines and forget to follow up?
Do you micromanage too often?
Do you regularly coach your employees?
Do you invent busy work?
Do you stand up for your employees?
Are you sometimes self-absorbed and manipulative? Are you sometimes cold or abrupt?
Do you fail to give productive people encouragement, autonomy, and latitude?
Do you expect that there’s only one way to do a job, and that’s your way?
Do you raise your voice unnecessarily?
Do your employees avoid eye contact or dread meeting with you?
Do you act as if your team or organization would fall apart if you were to go on a vacation for a week? Do you expect regular updates from your team even while you’re on vacation?
Do you withhold information from your staff because it takes too much time to fill them in?
Do you ignore workplace concerns (inappropriate dressing, for example) until they evolve into problems? In other words, do you let concerns fester and let problematic situations get worse?

Persuade Others to See Things Your Way: Use Aristotle’s Ethos, Logos, Pathos, and Timing

January 19, 2016 By Nagesh Belludi 1 Comment

During argumentation—i.e. when putting forward a point of view—your goal is to persuade your audience that your thesis is valid, engage them in your favor, change their opinion, and influence them to act as you’d like them to act.

The American literary theorist Kenneth Burke wrote in his Rhetoric of Motives, “Wherever there is persuasion, there is rhetoric. And wherever there is meaning, there is persuasion.” Learning to make effective arguments is helpful in every facet of decision-making and sharing ideas with others—not only in verbal and written discourses, but also in marketing, sales promotion, crisis-management, storytelling, courtship, social etiquette, and education.

Some 2400 years ago, the Greek philosopher Aristotle wrote one of the most important works on argumentation. In his treatise Rhetorica, he explained that arguments are more persuasive when applied in three distinct but inseparable dimensions: ethos (credibility,) logos (reason,) and pathos (emotion.) He wrote,

Of the modes of persuasion furnished by the spoken word there are three kinds. The first kind depends on the personal character of the speaker; the second on putting the audience into a certain frame of mind; the third the proof, or apparent proof, provided by the words of the speech itself … The modes of persuasion are the only true constituents of the art: everything else is merely accessory.

There are, then, these three means of effecting persuasion. The man who is to be in command of them must, it is clear, be able (1) to reason logically, (2) to understand human character and goodness in their various forms, and (3) to understand the emotions—that is, to name them and describe them, to know their causes and the way in which they are excited.

Element #1 of Persuasion: Ethos (‘Character’ in Greek)

Aristotle contended that audiences are more likely to be convinced when an argument comes from someone of standing, repute, authority, and legitimacy:

We believe good men more fully and more readily than others: this is generally true whatever the question is, and absolutely true where exact certainty is impossible and opinions are divided … It is not true, as some writers assume in their treatise on rhetoric, that the personal goodness revealed by the speaker contributes nothing to his power of persuasions; on the contrary, his character may almost be called the most effective means of persuasion he possesses.

Your ability to persuade depends on demonstrating that you are a credible authority on a subject. Credibility comes from your academic and professional credentials, social standing, integrity of character, and trustworthiness.

Ethos is also about how you express your expertise. Enhance your ethos by projecting confidence and paying attention to your mannerisms, dress, demeanor, tone, style, posture, body language, and crispness of your message. Appeal to ethos because your audience is likely to be persuaded if they believe you’re likeable and worthy of their respect. If you lack credibility, you must determine how to produce credibility, address your lack of it, or involve somebody credible who can vouch for your ideas.

Element #2 of Persuasion: Pathos (‘Suffering’ or ‘Experience’ in Greek)

As the saying goes, when the heart pulls, the head tends to follow.

Aristotle contended that persuasion also depends on making an emotional and imaginative impact on the audience by “putting the hearer into a certain frame of mind” (“ton akroaten diatheinai poos”):

Secondly, persuasion may come through the power of the hearers, when the speech stirs their emotions. Our judgments when we are pleased and friendly are not the same as when we are pained and hostile.

To appeal to emotion, you must understand and relate to the needs, values, and desires of your audience. Identify and appeal to what motivates the audience to anger and happiness, what irritates them and leads them to fear, what animates them and arouses their empathy. Defense attorneys often use this technique: they try to appeal to a jury or judge’s emotions by invoking sympathy for the accused and swaying them into thinking that the accused has done little or no wrong.

Element #3 of Persuasion: Logos (‘Word’ in Greek)

Logos refers to the argument’s clarity and integrity. Aristotle stressed logic and the appeal to reason:

Thirdly, persuasion is effected by the speech itself when we have proved a truth or an apparent truth by means of the persuasive arguments suitable to the case in question.

Appeal to your audience using logical consistency, analytical reasoning, rationale, and supporting evidence. Don’t just persuade your audience from your vantage point. Instead, construct a viewpoint that can assert your audience’s own objectives and goals.

Element #4 of Persuasion: Timing

Aristotle mentioned that timing of delivery is a fourth dimension of successful argumentation. Therefore, even if ethos, pathos, and logos are in place, efforts to persuade may fail if they are deployed at the wrong time.

These three kinds of rhetoric refer to three different kinds of time. The political orator is concerned with the future: it is about things to be done hereafter that he advises, for or against. The party in a case at law is concerned with the past; one man accuses the other, and the other defends himself, with reference to things already done. The ceremonial orator is, properly speaking, concerned with the present, since all men praise or blame in view of the state of things existing at the time, though they often find it useful also to recall the past and to make guesses at the future.

To persuade your audience, know where to focus the conversation—the past, present, or future. As the Greek didactic poet Hesiod emphasized in Works and Days, “observe due measure, for right timing is in all things the most important factor.”

Use Four Vantage Points to Improve Your Abilities in Argumentation and Negotiation

You can be more persuasive if you understand what truly moves your audience. Some people are swayed by logic, others by appeals to emotion, and still others quickly defer to those who seem to possess authority and expertise.

Aristotle’s ethos, pathos, and logos provide a clear, understandable, and easy-to-apply framework for developing argumentation. Although these three elements can be analyzed separately, they often overlap and work together. Often it may not be possible or useful to completely distinguish them.

Recommended Resources

Round up your persuasive skills by combining Aristotle’s technique with these recommended approaches.

Robert Cialdini’s best-selling books, Influence The Psychology of Persuasion and Science and Practice, identify six ways to persuade another person. Watch this and this YouTube videos for excellent summaries of these six principles.

reciprocity, when the other acts in expectation that his/her favors will be returned
commitment and consistency, when the other takes actions consistent with his/her self-image
social proof, when the other replicates the actions of others
authority, when the other acquiesces to authority even if the request is questionable
liking, when the other is persuaded by those whom they know, like, respect, and admire
scarcity, when an object becomes more desirable because it is in short supply

Simon Sinek’s Start with Why advocates that when pitching a product, service, idea, or proposal to an audience, you must start with answering why they should they care. “People don’t buy what you do, they buy why you do it.” Sinek’s TED talk (this YouTube video) describes his concept of “The Golden Circle”—with the ‘why’ at the core, surrounded by ‘how,’ and the finally the ‘what.’
Richard Shell and Mario Moussa’s The Art of Woo recommends that people use relationship-based, emotionally intelligent approaches to persuade others of the value of their ideas to “win them over” rather than to “defeat” them.
William Ury’s The Power of a Positive No offers a “yes-no-yes” framework to (1) connect a situation, circumstance or dilemma to your core set of interests and values, (2) communicate your decision assertively and respectfully and yet obtain the most positive outcome for you and for others.
Roger Fisher, William Ury, and Bruce Patton’s popular book Getting to Yes offers an step-by-step plan of action for coming to mutually satisfactory agreements to conflict.

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