HP’s Meg Whitman follows Marissa Mayer’s lead: All Hands On Deck

Meg Whitman’s turnaround has not been going well. In late August Whitman told analysts that she doesn’t expect the company to grow its revenues in the coming fiscal year, and she reassigned Dave Donatelli, who had been running HP’s enterprise business for five years.

HP is still making half of its revenue from its PC and printer business, which is being slammed — like every other company in that sector — by the rapid shift to tablets, falling 9% from the same quarter a year ago. But all parts of HP are in decline, like its customer server business.

All of which is a preamble to today’s news that Whitman is revising HP’s policies around remote work, echoing Marissa Mayer’s claims that the company needs “all hands on deck” in order to affect a cultural transformation. Here’s the text of a document that supports the new policy:

My Workplace, My HP Community. What is the goal of the effort?

As part of the company’s overall turnaround strategy, there is an effort underway to bring employees who currently work from home to work from the office. This effort is part of the company’s cultural shift and will help create a more connected workforce and drive greater collaboration and innovation. In some major sites thereto large amount of underutilized workspace and we want to make the best use of our space. HP will maintain flexible work arrangement options, but with greater clarity and consistency about how to use them.

Why now?

During this critical turnaround period, HP needs all hands on deck. We recognize that in the past, we may have asked certain employees to work from home for various reasons. We now need to build a stronger culture of engagement and collaboration and the more employees we get into the office the better company we will be. Belief in the power of our people is a core principle of the HP Way Now. Employees are at the center of what we do, we achieve competitive advantages through our people. HP has amazing employees who are driving great change. We believe the more employees we have working together, the better for HP and our customers.

How does this support the company strategy end culture?

We want to make HP a great place to work and build a stronger HP Way Now culture of engagement and collaboration. Employees who are more connected tend to be more collaborative, productive, and knowledgeable. They will also have a greater sense of the company goals and experience a greater sense of pride in HP. We believe that having employees work from the office will unite and inspire them to achieve higher levels of operational excellence and innovation.

Which employees are affected?

The overall effort is designed to increase collaboration among all employees, including employees who regularly work from home despite having an assigned desk at a site, telework employees who are near HP sites, and those who regularly work in an office now. Employees with part-time or job share arrangements are expected to work from the office. Where legally permissible, contingent workers also are expected to work from the office.

I won’t recapitulate all the arguments I made earlier in the year about the downside of a “no remote work” policy (see Yahoo’s Mayer thinks that remote workers are… too remoteWhat Marissa Mayer’s ‘no remote work’ dictate meansNowhere to run, nowhere to hideThe polarization around remote work comes as no surprise, and Jennifer Magnolfi on Marrisa Mayer’s ‘no remote work’ edict).

Unlike Yahoo — where only a relatively small number of the firm’s 12 thousand staff worked remotely — HP employs 300,000+ employees worldwide, and HP’s remote work policy was general and actively promoted by the company as a way to reduce costs. In fact, it is unclear that there is room to house all the employees and consultants it employs in its current office space, despite recent layoffs. So it is likely that this will affect a lot of people, and there may be a lot of folks who will continue working remotely because of office constraints, long commutes, or other extenuating circumstances.

At the superficial level, the “all hands on deck” argument is that the company has developed a plan for its recovery and everyone has to align with that plan and work hard to achieve it. However the company has been communicating that plan and working to rally people around it in the past is inadequate for the degree of change needed at HP, which is more than a simple realignment of priorities and direction. The HP Way — which started as a set of core values and has morphed into a new HP Way Now framework of ideas that theoretically is creating a new culture at HP — apparently require more indoctrination, despite the supposed core value: “We have trust and respect for the individual”. But that trust requires the individual to do their work in one of HP’s offices, apparently.

The real, deeper push at HP isn’t intended to make people more collaborative, productive, and knowledgeable. This shift in practices is so that first-line managers can monitor people’s work more closely, and find out who is most — or least — aligned with the stress factory culture that HP has become. That will make it easier to decide who to cull in the inevitable rounds of layoffs coming in HPs next few quarters, as it sinks toward the bottom of the abyss that once was the enterprise server and PC market, and which — for all intents and purposes — is effectively dead, at least as an area of growth.

The real downside of this episode is that it casts a negative light on remote work and flexible working schedules, which HP was a pioneer in. As Peter Burrows wrote in BusinessWeek in 2004,

They shunned the rigid hierarchy of companies back East in favor of an egalitarian, decentralized system that came to be known as “the HP Way.” The essence of the idea, radical at the time, was that employees’ brainpower was the company’s most important resource.

To make the idea a reality, the young entrepreneurs instituted a slew of pioneering practices. Starting in 1941, they granted big bonuses to all employees when the company improved its productivity. That evolved into one of the first all-company profit-sharing plans. When HP went public in 1957, the founders gave shares to all employees. Later, they were among the first to offer tuition assistance, flex time, and job sharing.

But the company has veered backwards, with a more reactionary style of management, and undoing the culture that Hewlett and Packard started in a one-car garage in Palo Alto in 1938.

 

Marissa Mayer talks about ‘no remote work’ edict

And doesn’t say much:

“There’s a theory I subscribe to: that people are more productive when they’re alone, but they’re more collaborative and innovative when they’re together.”

Successful organizations have very strong company cultures, said Mayer, so her goal after taking the helm of the stagnating company was “not to change the culture because [Yahoo!] has a tremendous culture already, but to amplify the culture,” she said.

And what are the basic tenets of that culture? Free lunch, so people don’t leave the office. No remote work, so people have to come to the office.  She doesn’t say much else, because the cultural foundation is work hard, the elite will decide all important issues, do what you’re told. Oh, and the nine figure rule: if an idea won’t generate $100 million in revenue or won’t add 100 million new users ‘then it’s probably not a big enough idea for us’. And everyone at Yahoo now shares their quarterly goals, but the subtext is you shouldn’t achieve them all: she expects a norm of around 70%, to indicate that people are aspiring to do immense things. And to accomplish 70% of them.

It all sounds like a bunch of platitudes, and not deep culture. And maybe that’s what she’s confronted with: the need to build some kind of a deep culture, and not enough time to do it. I can’t blame her for trying, I just wish she had gone for fast-and-loose instead of slow-and-tight.

 

 

Why isn’t the future of work top of mind?

From one perspective. last week’s ‘big story’ was the continuing fall-out and discourse about Marissa Mayer’s ‘no remote work’ diktat. I added a bit of fuel to the fire with Cultural change is really complex contagionWhy are disengaged employees disengaged?, and Why work doesn’t happen at work. But since I analyzed that issue at some length last week, I’ve decided to talk about something different.
Last week, SxSW ramped up, with the event’s curious admixture of tech Mardi Gras and the search for the next-shiny-app. I decided, several months ago, to sit out SxSW, for a variety of reasons.
SxSW obviously jumped the shark a few years ago. In Jan 2011, I wrote about SxSW:

Stowe Boyd, Why I Am Not Going To SxSW
I have attended SxSW Interactive a few times, and I’ve found it to be a high-tech Woodstock, without the mud or the music. Just lots of people milling around, and queued up for the parties, the after parties, and the after-after parties.
The selection approach for the talks is all about popularity, and there is no obvious thematic control, and no MC, so the sessions are very uneven. Some can be great, but the majority are a rewarming of shopworn topics. The most popular talks are too crowded to admit all those that want in, so you’re lucky if you get into one in five of those.

By a curious turn of events, I had clients who wanted me to meet with them during SxSW that year, so I wound up in Austin during the event, but without a pass. And I found that sort of interesting, since I could observe the goings-on without the same expectation of attending a conference, but more like an errant anthropologist. Again, in an odd twist of events, I was asked to be on the program committee — which meant a free pass in ’12 — and I accepted thinking that I might have some impact on the program. And, I also had a panel accepted for ’12 (with Dave Gray, Megan Murray, and Gordon Ross), so I had reasons to attend.
But there were only a small number of sessions that appealed to me last year, and some I couldn’t get into because Interactive has become just way too packed. I looked carefully at the program, and there just wasn’t enough that I wanted to see to make it worth the money, time and travel. So, although I am still on the program committee, and I have a free pass, I opted to not go.
But I want to use that as a pivot point to ask a related question: why isn’t the future of work more of a burning issue? Why aren’t there more sessions at SxSW on social business, why aren’t more social business vendors out there promoting their vision of the future?
Perhaps the acquisition of Yammer, Podio, and Socialcast has made social business software seem like ‘business as usual’ and not as likely a breakthrough in productivity as apps like Tempo or Mailbox.
I think there is a huge dislocation going on. Issues like Yahoo’s ‘no remote work’ ban are top of mind, as are the societal stressors like our increasing work/life imbalance, the freelance economy, the downsides of temp work a la Amazon distribution workers, and a long list of others.
We seem to be lacking a positive vision of the future of work, one that would make it more interesting. In business terms, some set of ideas that would put the future of work in the black, and pull it out of the red.
I’ve written a bit about open work (see Open work is the next high water mark for social business), but absent some actual software products being developed to implement that (where are you, LinkedIn?) it’s just a handwave by a futurist.
What I think is needed is a better understanding of what is going on, in the office buildings and home offices across the country and across the world, to help people understand that we aren’t just being blown before the winds of a precarious economy, we are actively headed somewhere, even if we haven’t been able to say exactly where that is.
So I think that the fact that this critical and timely discussion isn’t occupying top of mind in the business world reflects a failure of people like me to do our jobs, which is to try to make sense of the large trends shaping the world of work, and to cast those in terms that help others to take affective action. And specifically, to make clear where we are headed, and why. I promise to rededicate myself to that task.

Cultural change is really complex contagion

I have been thinking a great deal about cultural stability and cultural change in business, recently. Partly that’s the outgrowth of a report I am working on, and partly it’s the result of the Yahoo ‘no remote work’ brouhaha, which boils down to Marissa Mayer trying to change the culture of Yahoo. So, I thought I would advance a science-grounded discussion about cultural change, and risk an overly long piece. (I haven’t gotten any ‘TL;DR’ messages here, yet.)

First of all, let me submit to you that the tangible result of culture change is behavioral change. For example, if a company went through some series of activities intended to improve meeting hygiene — shorter, more effective meetings, with agendas and action plans, etc. — the proof would be that meetings were measurably shorter, participants hated them less, they led to higher degrees of follow-through, and so on. Yes, leading up to those measurable behavioral changes, cultural change has to start in the minds of the individuals: they have to change their value systems, learn new skills, and reject old ways of doing things. But the proof is in the pudding.

I recently wrote about ‘social deviants’ playing a key role in cultural change (see How ‘positive deviants’ help a culture change itself). Social deviants are not perverts: they are members of a community that already display some set of desired characteristics when most of the other members do not. In that earlier post, I recounted the story of how MRSA — the drug resistant strain of staph infection that plagues many hospitals — was stamped out at a Pittsburgh hospital. The technique was to have the community identify those positive deviants that were already displaying behaviors likely to decrease the spread of MRSA, and then put those deviants into a role of disseminating their practices, so that others could try to adopt them personally. In the Pittsburgh hospital, the MRSA infection rate fell by more than half in less than six months.

The premise behind positive deviant-based innovation is that you can find insiders approximating the behaviors needed for a cultural change, and the community can work within itself to spread those behaviors, and find new ones, and to make the change collectively. It doesn’t require outsiders, except to bring and spread the idea of positive deviancy.

But what is the social network analysis behind this sort of cultural transformation? What sorts of companies are most likely to be able to make cultural changes?

Damon Centola and his colleague Michael Macy wrote a foundational article about this issue, called Complex Contagions and the Weakness of Long Ties. Their work builds on the work of Mark Granovetter, who developed the distinction between the ‘strong ties’ between close friends or kin, and the ‘weak ties’ that exist between more casual acquaintances. Weak and strong are not only relational — referring to the strength of the tie, and the frequency of the individuals’ interactions — but also indicate a structural dimension. Weak ties connect strongly linked clusters — cliques of friends or tightly-knit families — and act as a mechanism for novel information to move from one cluster to another, and once that information reaches a cluster, it spreads to all the members. As a result, Grannoveter called this the ‘strength of weak ties’, and he credits them with being the most important means of information transfer. And information also includes disease, like passing around the newest flu bug, and other social phenomena, like happiness.

So the scenario for contagion is fairly intuitive: on Monday no one in Betty’s office has a head cold. Monday night, Betty attends a meeting of communications professionals, none of which are close friends, but she has a cocktail with a few casual acquaintances, and the new morning has a slight sniffle. She goes to the office Tuesday, but leaves early with a head cold. By Friday, 70% of the office has it.

And it doesn’t require very many weak ties in a city for the head cold to reach everyone. It’s a small world, as Granovetter famously put it. But not all contagion is simple, like a head cold, and so the primacy of weak ties — in other situations — may diminish. Centola and Macy call this the ‘weakness of long ties’.

In simple contagion, only one exposure to the rhinovirus is necessary to get the disease. But other sorts of information transmittal — especially around information that is controversial, advocates risky behavior, or is counterintuitive — has a greater threshold for being passed along. As the authors say,

A contagion is complex if its transmission requires an individual to have contact with two or more sources of activation. Depending on how contagious the disease, infection may require multiple exposures to carriers, but it does not require exposure to multiple carriers. The distinction between multiple exposures and exposure to multiple sources is subtle and easily overlooked, but it turns out to be decisively important for understanding the weakness of long ties. It may take multiple exposures to pass on a contagion whose probability of transmission in a given contact is less than one.

[…]

By contrast, for complex contagions to spread, multiple sources of activation are required since contact with a single active neighbor is not enough to trigger adoption. There are abundant examples of behaviors for which individuals have thresholds greater than one. The credibility of a bizarre urban legend (Heath, Bell, and Sternberg 2001), the adoption of unproven new technologies (Coleman et al. 1966), the lure of educational attainment (Berg 1970), the willingness to participate in risky migrations (MacDonald and MacDonald 1974) or social movements (Marwell and Oliver 1993; Opp and Gern 1993; McAdam and Paulsen 1993), incentives to exit formal gatherings (Granovetter 1978; Schelling 1978), or the appeal of avant-garde fashion (Crane 1999; Grindereng 1967) all may depend on having contacts with multiple prior adopters.

The authors enumerate conditions of complex contagion:

  1. Strategic complementarity — Knowing about some new innovation is not enough to induce people to adopt it. We all evaluate the costs and benefits of an innovation, and wait until we feel it’s ‘worth it’.
  2. Credibility — When other people we know adopt innovations, we are more likely to do so too. Hearing the same story for different people makes it more believable, and we are them more likely to pass it along.
  3. Legitimacy — When we see others wearing a fauxhawk or jeggings, we are more inclined to do so ourselves. As the authors point out, ‘Innovators risk being shunned as deviants until there is a critical mass of early adopters’.
  4. Emotional contagion — Again, it has been shown that emotionality can be passed along in tight social groups, like cruelty and happiness.

Adopting innovative behaviors, like stand-up desks, or dropping older behaviors, like smoking, is more likely in settings where others are talking about or doing the same things. And since the greatest frequency of interaction takes place with close friends and family, people can be pushed over the threshold to adopt new behaviors in settings of higher social density.

Note that this doesn’t necessarily have to involve face-to-face interactions. Online friendships are as real as those IRL (in real life): the same brain chemicals surge when someone give you an ‘attaboy’ in the company chat, as when you are physically patted on the back.

But the big takeaway for me, with regard to cultural change in the business, is that new behaviors are hard to spread when the following conditions hold:

  1. Workers have few trusted and close company friends
  2. The new behaviors being advocated are unfamiliar, risky, or contrary to the current status quo
  3. Very few employees have adopted the new behaviors.

We can consider this the downside conditions for ‘complex cultural change’. The trick for turning it around is demonstrated in the research of the authors, as well. They demonstrated that new healthy behaviors are more likely to be adopted when clusters of people who are all friends or kin meet and discuss  on the progress or difficulties they are experiencing in adopting the new behaviors. This is also congruent with positive deviancy.

So,  when companies want cultural change, the first step is not to tell people how to change their behaviors. The first step in cultural change is to increase the density of social engagement, or, more simply, to try to help people make more friends at the company. The second step is to find positive deviants — people who are already demonstrating the behaviors that will define the new culture. Then, those deviants and the deviants’ closest contacts should work to share their efforts in amplifying the desired behaviors, and as those ideas become less controversial and more mainstream, others will begin to be more open to adoption as well. But for fast and lasting change, this must all grow from within. As Centola and Macy’s work shows, the weakness of long ties make it very difficult for Betty in the New York City office to be convinced to adopt new marketing approaches from people she doesn’t know and trust in the San Francisco office. She will have to hear about it many times, and with the words coming from trusted mouths.

And this suggests both a path for Mayer to take and why her challenge is so significant. She may think that barring remote work will lead to people making more close connections in the office, but she might have been better off framing her first step as increasing the social density of the distributed workforce across Yahoo, and then as a second act, finding the social deviants inside of Yahoo and let them figure out how to spread that cultural change, themselves. You have to leave cultural change up to the deviants, not to management.

In the Pittsburgh hospital, for example, the doctors — the most well-educated and highest paid on staff — were the worst offenders in spreading MRSA, and the single most effective positive deviant was a low-paid health care aide with only a high school diploma.

You can’t predict where the cultural change will start, but you can predict how it will spread: through strong ties.

Jennifer Magnolfi on Marrisa Mayer’s ‘no remote work’ edict

I was talking with Jennifer Magnolfi, a leading proponent of the new thinking behind workplace design and its impact on innovation, creativity, and work culture. Since I had her on the line, I thought I’d get her take on Marissa Mayer’s motivations for the recent Yahoo ‘no remote work’ edict.

Stowe Boyd: I wanted to take a minute to get your thoughts about Marissa Meyers ‘no remote work’ edict.  it’s not in effect yet, it will be going into effect in June. There’s all sorts of controversy about it but I think the biggest question is does it represent a step backward to the panopticon notion that workers have to be watched in order to be productive?

Jennifer Magnolfi: Yes, of course I’m familiar with the case. There’s been a storm online of responses: critics and supporters alike have shared their opinions. From my perspective I wouldn’t attribute to this business decision to a broader statement of about the way we should work in the 21st century. I would imagine this to be a more specific business tactic, serving a near-term strategy to reinvent and bring the company forward to a degree of innovation that hasn’t been present there in a while.

Boyd: I think that’s the most generous interpretation I’ve seen. Various entrepreneurs are saying she has a problem, her house is on fire, and she has to put it out. The fact that she believes pouring water over the building is the best thing to do now doesn’t mean she wants it soaking wet for the rest of all time.

Magnolfi: I just got back from Las Vegas where I worked with another business leader of a tech company who is making a very specific, conscious investment in the importance of the physical environment of the culture. At Zappos, Tony Hsieh sees that as having strategic importance for the future of the business. It is widely known that this is what Tony has brought to his company. And to the world of business management — from a purely research-based perspective — it sounds really contrary to the mainstream view. And many people outside of Yahoo think companies benefit from the concept of worker mobility.

This is one of the biggest shifts in technology, and that has caused shifts in business culture, and in the social contract between employees and employers. From a purely research perspective there is no doubt that the potential for increasing knowledge creation, or the probability of increasing knowledge creation (which just means the creation of new ideas) is much higher when you are able to combine digital space interaction and physical space interaction. When you can combine the serendipity or the seemingly random knowledge streams you have online to offline, and to develop a ‘community of work’: it’s obviously a tremendous asset.

Boyd: I agree to the extent that you are looking at it micro-economically, relative to a single business for a short period of time.

Magnolfi:: I don’t think Yahoo’s internal strategy has been disclosed. I certainly haven’t come across it. It strikes me that it makes sense that one of the tactics that Mayer is deploying — at a specific moment in time — to reignite or accelerate a certain type of performance. I just can’t imagine the company or certainly Ms Meyer isn’t aware of the potential mobile technology has. Given her previous track record,  I’m a little less shocked by this. For a quite a bit of time now, I’ve been studying the potential and actual benefits of certain types of interactions being augmented in the physical environment.

Boyd: The term I use is concidensity: by increasing the density of people you are increasing the probability of coincidence, or serendipity.

Magnolfi: That’s a really good term, it’s a really fun term. I think if you are in that position, why wouldn’t you leverage that asset? I guess that’s the question I would ask, not knowing the internal context. I guess I’m not as harsh a critic of that, since it’s a tactical move. I don’t think it means more than that at this point.

Yes, I think coincidensity is a useful (and fun) term, one that I stole outright from Matt Biddulph, formerly of Dopplr. And I have to grant that Mayer is trying to make a cultural shift: specifically trying to get a culture that has been running in a fast-and-loose, networked way to a more tight-and-slow, collective mindset.

Mayer thinks that sort of culture is what is needed to turn the boat at Yahoo, and, grant you, she might be right. But it is running cross-grained against a number of newly instituted cultural work norms related to the  value of higher individual autonomy, results-oriented work, and application of social and mobile tools to support distributed, disconnected, and decentralized work.