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Presentation by Stephen Porter Authors of the article: Dorothy Leonard, Walter Swap.

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Presentation on theme: "Presentation by Stephen Porter Authors of the article: Dorothy Leonard, Walter Swap."— Presentation transcript:

1 Presentation by Stephen Porter Authors of the article: Dorothy Leonard, Walter Swap

2 Deep Smarts Mysterious quality, good judgment System view as well as expertise in individual areas Their knowledge is essential Organization cannot progress without it

3 Dorothy Leonard Ph.D. Stanford University Business Administration professor at Harvard organizational innovation, technology strategy, and the commercialization of new ideas 35 articles and books

4 Walter Swap Grew up in Alaska Bachelors at Harvard Ph.D. University of Michigan Lectured at Tufts University Founding member of the university’s Innovative Center for Decision Making Married Dorothy Leonard Work together publishing

5 People with Deep Smarts Stand out among other people Know the business, the customers, product line both overall and in depth Experience based: Can’t be produced overnight Ex. Marketing director promoted previous director left and knowledge lost

6 Teaching Deep Smarts can be taught but it takes

7 Brad Anderson Believes in innovation Hired Strategos to coach employees about the importance of innovation Rare investment for a company

8 Most Organizations More developed by chance than intent Trial-and-error learning instead of carefully planned transitions Increases turnover rate of employees Most training programs transfer technical or managerial knowledge-not deep smarts

9 Research 35 companies in two years Interviewed 200 people The following illustrates how organizations can develop and sustain profound knowledge among employees

10 Weapon Tech 1980s Two companies competing for contract for tactical missiles Neither had a competitive advantage Scientist stepped forward, called meeting Thrilled buyers of details of design change Company won contract

11 CEO (Bill Campbell) talks board of directors out of allowing the company to miss earnings commitment Revenues were down If stock dropped, employee options would be worthless He new where to cut costs and did just that Cut expenses and hit financial targets

12 Did Campbell have Deep Smarts? Knew details of company operation Found areas for potential cost cutting Understood the big picture and financial environment Could foresee Wall Street, employees reaction Persuasive arguments for board members Emotionally intelligent and understood the system as a whole

13 The Science Behind (Experience) Rather fly with a pilot who has flown in all kinds of weather Surgeon saying “Wow-never seen one of those before” Encountering situations accumulates a storehouse of knowledge Have the ability to react quickly without a lot of effort Becomes a gut feeling Ex. Accountant who finds number mistakes can’t explain how she got the answer but know its wrong from experience

14 Are experts always right? Confidence leads to myopia or arrogance Reject contributions from others Mistakes can be made Ex. Doctor prescribing acid suppressant for indigestion when in reality it’s more serious Overconfidence Difficulty transferring knowledge May assume expertise where none exists

15 Passing on the Knowledge We use what we have to absorb new experiences “For someone to capture complex, experience-based knowledge, his brain has to contain some frameworks, domain knowledge, or prior experiences to which current inputs can connect.”

16 Sink or Swim Depends on the person Usually inefficient and ineffective Better to create receptors with framework to which experience can be tied

17 Guided Experience p.91 Learning by doing with feedback The novice has to discover the expert’s know-how through practice, observation, problem solving, and experimentation SituationExample New situation, great uncertainty Launching a new service product in a new market using a new mode of manufacturing

18 Guided Practice Practice makes better It’s better to assess outcomes after practice and see what needs to change. An experienced coach (boss) can help guide in the right direction

19 Guided Observation Have a catcher to observe then discuss afterword Ex. Junior consultant sat in on client meetings “Listen and learn” Learn more from debriefs than two years of business school Challenge beliefs, be exposed to foreign ways of thinking

20 Consultant group sent Best Buy team members to American Girl Place in Chicago Initially unsettling, out of comfort zone Socializing atmosphere for grandmothers, mothers, and daughters Also went to Mexico City, Amish countryside, Seoul

21 What did they learn? Different behavior/social patterns Generate ideas for products and services that would offer an experience or social happening Jennifer Rock a mid-level manager learned about employees- “Our success boils down to the interaction between one customer and one employee, Is that employee happy and productive and informed and excited? We need to know that employee's state of mind better than anyone else in the company."

22 Guided Problem Solving Coach transfers know-how more than know-what Physicians convert book smarts into experienced- based smarts by working with veteran doctors during residencies Apprenticeships Focusing attention, sharpening process skills, giving feedback, providing opportunity to mimic an expert

23 Guided Experimentation Children experiment and learn quickly ActivePhoto (software) initially chose three customer bases and by experimenting (pilot studies), found two that worked Whirlpool learned that customers like customization; ended up actually spending more

24 Admired for efficient manufacturing; attracted imitators True advantage of Toyota: Mind-set of employees, hypothesize about possible improvements, experiment

25 Does it cost to much? One executive says “the days of apprenticeship are over. We’re convinced that guided experience is the only way to cultivate deep smarts” Guided experience increases value of employees and the business as a whole; how can companies afford not to invest in it?

26 My Thoughts It takes the right person to have Deep Smarts The way a company passes on knowledge depends on the situation and industry Some people may be taught through knowledge experience but may never develop the skill

27 References Biography-Dorothy A. Leonard. Harvard Business School Faculty and Research. DeBold, Joseph. (2004). Resolution on the Retirement of Walter C. Swap. Tufts University Arts, Sciences, and Engineering. Leonard, Dorothy, & Strauss, Susaan. (1997). Putting Your Company’s Whole Brain to Work. Harvard Business Review, July-August, 3. Tucker, Robert. (2010). Listening to Employees is a Best Buy. Blogging Innovation.

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