Managing Individual Differences Assessing Personalities

Why Personality? Top managerial challenge: –“The most frequent problems are a result of mismatched personalities” Davenport and Harris (“Competing on Analytics”) Selection and placement in the right roles PI Index: Clients include Microsoft, Exxon, IKEA, Caterpillar

Alan Mulally CEO, Ford The Demanding Cheerleader Dan Akerson CEO, GM Management by Barking Sergio Marchionne CEO, Chrysler Management by Walking Around “gives hugs and means it… no blame thrower but no soft touch either… has swept aside a culture of politicking and back-covering among Ford executives” “A gruff former naval officer with a frosty demeanor…doesn’t do hugs.” Shook up bureaucracy at GM but analysts “worry about the effect of all that ordering- about on morale... [wrong] approach to take with unions/dealers” “constantly on the move, dressed casually in a dark sweater (he says he buys them in bulk)… frequently pops up at Chrysler’s and Fiat’s factories to fix things on the spot– for good or ill, a micromanager”

Personality in the workplace Should we select on the basis of personality for jobs? If so, how? Should managers seek to provide feedback on personality issues? Should they attempt to “fix” personalities? Should they coach others on personality “improvement”? Do organizations need to be diverse in terms of personality? Will organizations that are diverse in terms of personality perform better in the marketplace than those that are homogenous?

Key Challenges What is personality, and what is its relation to behavior? Is personality in the eye of the beholder? What of self-fulfilling prophecies? What’s an appropriate scientific measure of personality? Is it valid? Is it reliable? How does one distinguish the influence of personality on actions from that of culture on actions? Is personality destiny?

The Blank Slate? We all harbor theories of human nature: we use them to persuade, threaten, inform, love, deceive. We also use them to manage people in the workplace. The human mind has no inherent structure; it is malleable and can be shaped by socialization, culture, etc.? John Locke’s empiricism vs. modern genetics

14 The Blank Slate? Personality Predicts Brain Response During Cognitive Tasks Kumari, Ffytche, Williams, and Gray (2004), The Journal of Neuroscience

History in Brief Earliest work: Personality as inner essence. Freud/Jung: Influence of early experience on later personality; structure of personality; role of sub- conscious and collective conscious. Skinner: Focus on observable behaviors; operant conditioning.

Personality Today Walter Mischel (1960s): Key influence of situation on behaviors Current focus: -Behavior as function of disposition and situation -More recent work looking into the link between biology and personality (resurrection of social darwinism?) -The Big 5; Self- monitoring

The Big Five Personality Dimensions Intellectual, imaginative, curious, broad minded 1) Openness to experience Relaxed, secure, unworried 5 ) Neuroticism/Emotional stability Dependable, responsible, achievement oriented, persistent 2) Conscientiousness Trusting, good natured, cooperative, soft hearted 3) Agreeableness Outgoing, talkative, social, assertive 4) Extraversion Characteristics of a Person Scoring Positively on the Dimension Personality Dimension

Myers-Briggs Attitudes ExtraversionIntroversion Action Reflection Perceiving Functions SensingINtuition Objective evidence Abstract evidence Judging Functions Thinking Feeling Detached Empathetic Ambassador Functions Judging Perceiving Closure Open-ended - Preferred modes of action (not aptitude), like being left or right handed. Type (one or the other) not trait (matter of degree). -93 forced choice questions used to categorize into one of 16 possible types. (e.g., ENFP; ISTP; etc.)

Sample Questions from MBTI You are almost never late for your appointments YES NO You like to be engaged in an active and fast-paced job YES NO You enjoy having a wide circle of acquaintances YES NO You feel involved when watching TV soaps YES NO You are usually the first to react to a sudden event: the telephone ringing or unexpected question YES NO 89% of the Fortune 100 use the MBTI

MBTI INFJ: “The counselor” I: 11%; N: 88%; F: 75%; J: 1% I= Introvert; N=Intuitive; F=Feeling; J=Judging -Contribute to others’ welfare -Like jobs requiring solitude -Also like interacting non-superficially with people -Exert influence behind the scenes - Attuned to values and seeking unique identity Examples: Sidney Poitier, Alec Guiness, Carl Jung 1.5% of the US population is INFJ

Problems with Psychometric Tests Forced choice questions (but we’re often in the middle: continuous not binary) Assumes that who we are is consistent; but in fact it depends, it varies depending on other factors (e.g., preference for type of boss depends upon type of job) Personality: A consistent pattern of behavior– but this pattern may vary across situations Very low test-retest consistency (Jung: “every individual is an exception to the rule”; “…a parlor game”) Adaptive unconscious versus constructed self: which self are we tapping. Two steps removed: personality trait  behavior  test Test for global personality traits or local behaviors related to the specific role you are trying to select for?

Why do Firms Use these Tests? (Despite the fact that they are potentially invalid) Speed of processing Desperate need to anticipate, understand, and resolve interpersonal issues Self-fulfilling prophecies “Hawthorne” effects

The Opacity of Behavior? Why can’t we simply divine intent and motivation from observed action?

Paul Ekman e/120104/faces.htmlhttp:// e/120104/faces.html The face is like a penis? Can one learn about true intentions by looking at discrepancies between spoken words and body language?

Why Does Personality Matter in the Contemporary Workplace? If this were 1965 [you] would have gone to work for a company, donned a blue suit, sat in your office and kept your head down; the particulars of your personality wouldn’t have mattered much. The culture of most companies out there today is such that you will not get a social script, blue suit, and organizational chart. You are expected to be part of a fluid team, flexible and innovative, to work with shifting groups in the absence of hierarchy. The workplace doubles as a rec room: The particulars of your personality matter a great deal. What is personality? –Motivations, skills, preferences, patterns of if..then responses (learned or hardwired?)

Who cares about personality? Select based on performance?

The Talent Myth The very best companies have leaders who obsess over talent. Recruit stars; reward disproportionately; push them into upper management track:”bet on the natural athletes” “The only thing that distinguishes Enron from competitors is our people, our talent. We hire very smart people and we pay them more than they think they are worth.” Ken Lay Differentiation and Affirmation: A (challenge and handsomely (>2/3) reward), B (encourage and affirm), or C (shape up or ship out). How should talent be assessed? Intelligence and intrinsic qualities or raw experience and past performance? What’s wrong with obsessing over talented employees? Is “talent” a fixed endowment, or can it be developed/wasted? Is the system is only as strong as its strongest stars vs. the system is the star: Enron vs. P&G

The War for Talent Hire those with the highest IQs/those from the “best” schools? -Correlation between IQ and job performance is around.1 -At school, most things are about “working by yourself. If you work with someone else, it’s called cheating….in the real world, everything you do involves working with people.” Assessing workplace ability: notoriously difficult: how do you assess performance when someone is moving too fast for a meaningful assessment? The story of Lou Pai at Enron: Is talent something separate from performance?

Kronos and the P.I. Index: A Classic Story of a Growing Organization What problems arose as Kronos went from being a small startup to a (pre-public offering) company with $30 million in annual sales? (Today: 3400 employees; taken private in 2007) Describe Mark Ain’s personality: What kind of a manager was he (before Praendex)? What problems prompted Mark to bring Praendex into the picture? What are the theories underlying Praendex’s approach to personality assessment? Do you buy into their views? Why or why not? What kinds of benefits did Kronos gain from the use of personality testing? Would you recommend a product like Praendex to companies? Why or why not.

Mark Ain and Problems before Praendex Mark Ain: –Founded company in ’77; by ’90, –B.S., MIT; MBA, Rochester (OB) - “I was always interested in what made organizations and people tick” - “I always knew that I wanted to do my own thing” - Early years: “did everything” - People thought: “I made decisions from the hip”; too involved in everything - “My philosophy was the best argument would win.’ - “I assumed this was a good way to operate because I was comfortable operating in this mode” -Hired Garret Lewis as COO in ’86; by ’90 let him go Question: “Could my management team handle higher level of responsibility? Should I look for another COO?”

Praendex and PI index Uncover behavioral styles to help managers understand their own and others’ behaviors PI index: approx. 80 words (e.g., shy, helpful): pick ones you see as desirable. A– Dominance (unassuming belligerent) [motivated by money vs. encouragement) B- Extraversion (shy/secretive friendly/sociable) [motivated by prestige and status vs. prefer to work alone/want to show competence) C- Patience (impatient/restless unresponsive/lazy) [need for security and routine] D- Formality/conform to rules (detail oriented rebellious/sloppy) [like to know what’s expected; structure and certainty; versus “do your own thing”] “The behavior of most individuals is remarkably consistent: a person tends to respond in the same way to particular stimuli” PI index not perfect predictor; must control for relevant factors, such as education, experience Tool for pre-employment screening; promote awareness of self and others;

Benefits of PI? Guidance on what kinds of sales people and branch managers to hire (more high As and Bs instead of high Ds) Insight into self: “I realized how different I was from most of our people”; and “how similar the management team was to me”; Paul Lacy (lower A and higher D): a valuable asset Mark Ain: Venturer; Paul Lacy: Specialist; Decker: authoritative salesperson, etc.

Kronos after PI The PI gave us a framework to understand our own and others’ behaviors. It gave us a language to talk about things in a non-threatening way; it legitimated talk about these things; and it provided an analytical lens to make sense of these issues. Mark Ain started delegating more: realized he was different; delineated responsibility; stopped second-guessing everyone. Paul Lacy: from curmudgeon to valuable player (who thinks differently than others– implementation oriented guy) Created a set of common goals: Everyone is now paid based on the company’s (not department’s) performance plan Instituted a “communications committee” made up of a mix of people so Paul wouldn’t have to do the communicating. Went public on June 5, 1992 (offered at $56 million)

What to do? Manufacture liking: –Promote familiarity –Redefine similarity –Foster bonding: the Sherif experiments/outward bound Leverage the likable: –Affective hubs: identify; protect Work on the jerks: Reassess contribution Socialize and coach Reposition (independent role)

Marshall Goldsmith Do you think that Goldsmith is providing a useful service? Do you buy his “recipe”? Why or why not? px?PageID=2http:// px?PageID=2 m/BusinessWeek.phphttp:// m/BusinessWeek.php

Marshall Goldsmith Do you think that Goldsmith is providing a useful service? Do you buy his “recipe”? Why or why not? There are no selves, only behaviors Not behaviors, perceptions Self is an illusion “Easier to get un-f*ed up than to understand why you’re f*ed up, so just get un-f*ed up” Recipe: Apologize, reject excuses, declare dependence

Impressions Don’t Manage Themselves © Michael E. Wasserman,