Posts Tagged ‘Innovation’

Boyden: BRIC Growth Brings Back War For Talent In C-Suite

May 9th, 2011

NEW YORK, May 4, 2011—The boom in BRIC markets is driving both corporate growth and a global demand for leadership to manage the new market potential, according to the quarterly Boyden Executive Outlook, released today by Boyden Global Executive Search.

“The growth of the BRICs is driving the hiring of executives throughout the Americas, Europe and Asia/Pacific,” said Trina Gordon, President and CEO of Boyden World Corporation. “Boards are focused on appointing leaders who can adroitly manage the transformation of business as well as the challenges in both the emerging and developed markets.”

Consumer/Retail
“Until recently, strong global brands have always been prime movers in attracting the best executives, though ‘second tier’ companies can now land top talent by paying more and offering more upside and opportunity to grow a company,” said Dirk Friederich, a member of Boyden’s Global Consumer/Retail Practice and Managing Partner at Boyden Frankfurt.  “Additionally, big worldwide retailers are stepping up management hiring, especially in developing markets.”

Due to expected retirements in the next few years, recruitment of CEOs is increasing in the consumer and manufacturing sectors. In addition, demand is increasing for Chief Marketing Officers and Senior VPs of Human Resources, much in part to help lead new business opportunities in China and other high potential regions, according to Pasi Koivusaari, Senior Partner at Boyden Finland. He added companies are also once again appointing management for Strategy and Research & Development.

“Our clients are looking for talent that is able to quickly assess the marketplace and how it has changed,” said Doug Ehrenkranz, a Managing Director at Boyden Houston. “In addition to changed economic conditions, the acceleration of digital technologies has changed how people shop and how companies manage their businesses.”

In the US, companies are pushing up priorities to recruit VP’s and Directors in the areas of Digital Marketing, and Social Media as well as Analytics and Consumer Behavior, Mr. Ehrenkranz added.

Some positive trends are being observed by retailers and their suppliers, though in the US there is continued reluctance to increase hiring due to great concern about the pressure on retail pricing from higher manufacturing costs and cautious consumers. Nonetheless, CEO appointments and numerous senior and mid-level executive assignments in Merchandizing, Product Development and E-Commerce are moving forward, according to Howard Gross, a Managing Director at Boyden New York.

Financial Services
“Strong and big offers are coming back in financial services,” said Jeanne Branthover, Leader of Boyden’s Global Financial Services and Managing Director at Boyden New York. “While companies are willing to go the distance for the right executive, they are taking as little risk as possible when looking at a candidate’s track record.”

Companies are investing in technology, new products and their own infrastructure to remain competitive. Organizations are also hiring top Financial, Compliance and HR Officers, added Ms. Branthover.
“Financial Services are strongly re-emerging, with a very positive outlook for profits, growth and expansion in all the sub-sectors, and particularly in the wealth management business,” said Armin Meier, Managing Director of Boyden Switzerland. “Firms are increasingly looking for financial advisors.”

In Asia/Pacific, Singapore is increasingly becoming a global hub for financial companies, triggering huge needs to build banking IT operations, trading floors and new teams of professionals to manage operations, according to Roger Wilson, Managing Director of Boyden Singapore.

In private banking, the increasing regulation involved in bringing over clients to new institutions is pushing up the threshold to recruit top Private Bankers to change firms, due to the trepidation that clients will not follow, added Mr. Wilson.

In China, financial services executive hiring remains robust in Shanghai, but is moderating in Hong Kong, according to Brian Renwick, a Board Member of Boyden World Corporation and Managing Director of Boyden China.

In Latin America, many major US banks are planning to gradually pull out of the region, due to tougher US government compliance. The opening is creating new opportunities to hire first-tier Private Bankers and for companies to up their expansion in the region including Morgan Stanley, UBS, HSBC and others, according to Manuel Corsino, a Managing Director at Boyden Miami. This includes adding top Wealth Managers, Compliance Officers, Product Managers and Finance Executives.

In the Middle East, despite social/political risks, 2011 has been a revival year in financial services, both in Private Banking and Investment Banking. Expectations are for continued increased hiring in the second quarter, though the third and fourth quarters cannot be predicted due to political uncertainty, according to Magdy El Zein, Managing Director of Boyden Middle East.

Technology
“Digital media and social networking companies continue to aggressively recruit seasoned digital marketing executives who can leverage social platforms to drive revenue,” said Daniel Grassi, Managing Director at Boyden Atlanta.  “Compensation for this type of executive has increased given the high demand.”

To scale more rapidly, companies are committing to higher premiums for senior executives in General Management, Sales, Marketing and Engineering, according to Dan Grosh, a Managing Director at Boyden San Francisco. He added there has been a substantial increase in hiring by emerging growth and cleantech companies.

“Indian software services giants like TCS and Infosys continued to make strong gains to start the year,” said Dinesh Mirchandani, Managing Director of Boyden India. “We are also seeing changes in leadership at top Indian IT companies such as Microsoft India, Mindtree and Wipro with the recent spate of C-level resignations in this sector.”

The UK technology market remained buoyant in the first quarter as most technology firms saw a positive start to the year, according to Mark Soden, Partner of Boyden UK. The overall forecast for the sector in 2011 remains cautiously optimistic though, as Chairmen and CEOs continue to live with some level of uncertainty. “The general consensus among management is often that an inadequately executed strategy is better than no strategy at all,” said Mr. Soden.
Specific sectors of technology that continue to thrive are those connected with Cloud, Data Centers and companies involved with SAAS (Software as a Service). European clients increasingly conduct global searches to occupy senior management roles for Senior Vice President and Sales Director positions, according to Mr. Soden.

Board Services
Risk assessment is a top priority for boards today.  “Many boards are making time to discuss inherent risk at every board and committee meeting,” says Sarah Stewart, a Principal at Boyden Pittsburgh and a board expert. However, identifying potential risk is only part of the job. “Boards also need to make sure the company has a well-constructed and rehearsed disaster response plan in place.  The planning includes deciding who are the members of the disaster response team, how the board will be kept informed and what external resources will be used,” she added.

“As boards place new emphasis on the issue of risk, many may want to add a familiarity with crisis management to the attributes they seek in new directors.  This has as much to do with tapping director candidates whose expertise comes from first-hand experience as it does their personal leadership skills,” according to Thomas Flannery, Leader of Boyden’s Board Services Practice in North America and Managing Director at Boyden Pittsburgh.  “Every board member needs at least one director (preferably more) whose wisdom and composure help keep the panic at bay.”

In the UK, compensation for Non-Executive Directors continues to rise, to ensure attracting the right board members, according to John Ellis, Managing Partner of Boyden UK.

Mr. Ellis added the renewed push to increase placement of women directors in FTSE 100 companies in the UK follows the recent report released, led by Lord Davies, which emphasizes that more women on boards will result in better diversity and ultimately better governance. In Switzerland, there is also a drive for more female board members in publicly traded companies. The goal is to implement diversity without having formal quotas, according to Mr. Meier of Boyden Switzerland.

Industrial/Energy
“In the oil and gas sector, there’s a demand for managers who are able to facilitate and close deals,” said Andy Baggus, a Partner of Boyden UK. “Position recruitment is picking up for Regional VPs, Commercial Planners and Business Developers.”

Leadership talent is also being aggressively pursued to develop in the Middle East and other challenging regions, Mr. Baggus added.

In South America, high commodity prices are driving growth and recruitment of management in Engineering, Construction and Infrastructure, throughout Brazil, Chile, Peru and other markets, according to John Byrne, Managing Director of Boyden Chile.

In South Africa, an influx of foreign multinational companies continues as the country is perceived as an excellent springboard for growth in Sub Saharan Africa and a location that’s relatively lower risk. Talent recruitment remains steady for roles including Managing Director, Country Manager, Chief Financial Officer and Chief Technology Officer, according to Jules Kieser, Managing Director of Boyden South Africa.

In the Aerospace and Defense sector, the effect of the pressure in the U.S. and other “allied” nations’ governments to cut defense spending will mean large scale programs are being reviewed and trimmed,” according to Tim McNamara, an aerospace/defense industry expert and Managing Director of Boyden Washington DC.

“This cut in defense spending has a carryover effect of less aggressive talent recruitment by defense contractors and management consulting firms, which have in recent years been the beneficiary of huge defense spending,” explained Mr. McNamara.  “However, programs dealing with cyber security and C4ISR issues continue to expand.”

Human Resources
In the Human Resources sector in Europe, companies are currently appointing fewer new senior executives in HR.

“There’s a dearth of qualified candidates and companies are reluctant to take risks,” said Lisa Gerhardt, Leader of Boyden’s Global HR Practice and Partner of Boyden UK. “Thus, at the moment, we are seeing more business people from other sectors and more internal candidates who are being considered for HR roles.”

In the US, executives are being recruited for roles including HR Business Partner, Internal Management Development and Talent Acquisition & Retention. These executives will be able to drive revenue results and create effective development programs, according to Greg Coleman, a Managing Director of Boyden New York with extensive experience placing global HR executives.

“We are seeing strong demand for HR executives who are able to build trust and morale again among employees who became angry and frustrated during the downturn,” said Mr. Coleman.  “Most important, companies are looking for executives in HR with a strong commercial orientation.”

Life Sciences
In the Life Sciences and Healthcare sectors, companies have a strong need for executives with both international management skills and regional understanding of Central and Eastern Europe, according to Kerstin Roubin, Director of Boyden’s CEE Life Sciences Practice.

“The number of expatriates being hired is shrinking as tax systems make it more attractive to hire local experts,” said Mrs. Roubin.

Professional Services
Demand for talent in professional services is building especially for specialists focusing in financial services, energy and infrastructure. Professional services tends to staff up six to 12 months ahead of other industries and currently organizations are reinforcing teams to be ready for economic growth and new projects, according to Miguel Zuil, Managing Director of Boyden Spain.

“Companies and their professional services providers are needing global teams to work in more complex situations and experience in South America, Africa and other growing markets is highly coveted,” said Mr. Zuil.

About Boyden World Corporation
Boyden is a global leader in the executive search industry with more than 70 offices in over 40 countries. Founded in 1946, Boyden specializes in high level executive search, Interim Management and Human Capital consulting across a broad spectrum of industries. For further information, visit the firm’s website at www.boyden.com.

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Innovation Desire Lines

April 21st, 2010

By Gunnar Branson

It is a common mistake to believe that innovation happens when someone comes up with a new idea.  New ideas are a common occurrence – every day, people all over the world come up with great new ideas, new solutions and brilliant potential inventions that could possibly end poverty, build a successful company, or make peeling an orange much easier.

Experiments, though crucial to discovering what is possible and how something might be innovated, aren’t innovation.  Prototypes and inventions aren’t innovation either, though they are an important step towards proving how innovation could happen.

Innovation doesn’t happen in the lab, the skunkworks or the strategy off-site.  It doesn’t happen in the garage of a genius, nor does it happen when a government task force comes up with an innovation blueprint.  Innovation might happen afterwards when the products of everyone’s labors are used by others, but there are quite a few good projects and initiatives that are easily forgotten in a few years.

What about all the patents?  According to the U.S. Patent office, over 350,000 new patent applications are filed every year with less than 200,000 patents secured – but a patent is no guarantee of innovation.  U.S. registered Patents in the last few years for the “Insect Death Ray”, the “Beerbrella”, (illustrated above), the “Flush Toilet for Dogs”, and the “Electro Shock Game”, are interesting, but can they be described as innovations?   They may be useful as entries in the Museum of Obscure Patents, but I question if they are innovation.

According to Richard Maulsby, director of the office of Public Affairs for the US Patent and Trademark Office, “There are around 1.5 million patents in effect and in force in this country, and of those, maybe 3,000 are commercially viable.” (Karen E. Klein, “Avoiding the Inventor’s Lament,” Business Week, November 10, 2005)

If someone invents something that no one buys, did innovation occur?

A good analogue to that question, surprisingly, can be found in metaphysics.  In the early eighteenth century, the philosopher and developer of “subjective idealism” George Berkeley introduced the idea of “To be is to be perceived”.  His ideas are usually introduced with the question,   “If a tree falls in the forest and no one hears it, did it really fall?”

Rephrased by Charles Riborg Mann and George Ransom Twiss in their 1910 book,Physics, the question became easier to answer, “When a tree falls in a lonely forest, and no animal is nearby to hear it, does it make a sound?”  When addressed as a physics question versus a metaphysical question, the answer is straightforward:  Sound, as explained by Mann and Twiss, is made up of three things:

  1. A source of waves – such as a tree falling and creating vibrations as it hits the ground.
  2. A medium for those waves to travel – such as the air
  3. A receiver – such as an ear, which translates changes in air pressure into what animals perceive as “sound”

Without any animals around to hear the sound, there are only rippling changes in air pressure – no actual sound has been created.

Much like sound in a forest, innovation requires three things:

  1. A source of innovation – a person or a team that is motivated enough to not only to come up with good ideas – but to develop them and influence others to follow.
  2. A medium for their ideas to travel – such as the marketplace, writing, broadcasting, the Internet, classrooms, churches or any other gathering of people.
  3. Receivers – People pay for the innovation, who will change their lives, collaborate with the source, give up something in order to innovate. The more people who receive it, the more innovative it becomes.

And just like the theoretical forest with no animals to listen – if no one adapts the new idea, process, concept or machine – innovation has not occurred. Put another way, “If someone doesn’t pay for it, then it didn’t happen.”

Innovation then, happens when others do it.  When customers buy a new technology, when a community stops doing what they did before and begins using a new rule of behavior, when an old paradigm is abandoned for a new one…when people make an invention their own – then innovation happens.

Innovation occurs, not when a new idea or invention is discovered, but when everyone else innovates.  The great innovators, whether it was Thomas Edison, Steve Jobs or Henry Ford, were not necessarily the greatest inventors – but they were the most effective at getting others to innovate their lives around a new invention.

So how do they get everyone else to innovate?

Consider the notion of “Desire Lines”.  Originally described by Gaston Bachelard in his 1958 book, The Poetics of Space, a desire line is a path left by people’s use of space.  A particularly graphic example is the erosion created in the ground as people and animals walk over vegetation towards their destination.  Most parks and college campuses have desire lines etched in the grass lawns – areas where people took short cuts off the carefully designed, planned and constructed concrete footpaths.  Frustrated landscapers have long tried to keep people from destroying the grass and flowers by creating fences and other obstacles – but they rarely work, as people tend to simply walk around those obstacles, creating new desire lines.

Most of the roads in older communities were built on top of desire lines created by horses, people and carts as they made their way from destination to destination.  Never a perfect geometric grid, these roads responded directly to the actual needs and behaviors of those who used them.  Instead of fighting desire lines – it is possible to put them to use.  Many designers will intentionally delay the building of walkways for several months and instead just plant grass around and between buildings.  After a few months, the natural traffic of students will create desire lines in the grass that can be “read” as a plan for final concrete walkways.  A wider path is built in the deeper areas of erosion and a smaller path in the light areas because the desire lines illustrate where more or less people walk.

By building on the desire line – it is possible to outsource the design to the hundreds of people who use the paths every day and unconsciously improvise their own course.

Desire lines can be found everywhere – not just on the ground.  Whenever people move through their lives, interact with others, buy things, change things and improvise things, they leave a path.  Everyone doesn’t always follow precisely the same path, but the desire lines can be read and understood.

A company that sells products to customers can often find desire lines right in their own balance sheet. A clear customer desire line was found when accounting discovered that one of their most profitable and steadily growing areas of business, despite falling new bike sales, was their after-market parts business.  In other words, customers were changing their Harley Davidson motorcycles themselves, using parts provided by the company.

Up until the 1970’s, Harley Davidson focused primarily on supplying transportation to military and police organizations.  The motorcycle gangs and tough guys that were modifying surplus bikes to their own needs were seen as an annoyance, and perhaps even a threat to their core business. Much as an eroded path through a field could threaten the beauty of a college campus.

Harley Davidson followed the desire line.  They started to sell more customization, club membership and the romance of an old-fashioned, rebellious, and incredibly loud experience that had been developed by their customers.  Motorcycle sales moved upwards, along with branded clothing, accessories, tattoos, and of course, after-market parts.

Harley-Davidson built their new business model on the desire lines laid down by their customers.  Despite some difficulties in recent years, this remains one of the more innovative re-inventions of a company in great part because, instead of trying to stop the desire lines, they followed them and strengthened them.

Finding desire lines should not be confused with typical customer research or focus group work.  Whenever a customer is asked, “what do you want?”  the answer is always a version of “what I have, but cheaper, easier, or more.”  As valuable as customer research is, it should never be relied upon solely to help companies and leaders chart an innovative path – largely because it reflects what exists today versus what could exist tomorrow.

One way to find a desire line in research is to ask customers or voters to fix something that bothers them.  Here’s an idea for a new product – how would you make it work better?  Here’s a new idea, how would you make it more attractive to others?

But even more powerful than asking questions is to watch behavior.  The Internet in particular has become a very good tool for finding desire lines – by aggregating data on what people look at, how they interact with it, how they change it, how they talk about it and ultimately, how they make it their own.

The desire lines are even easier to find and harness on the Internet.  Google, Wikipedia, Netflix, and now Twitter are all examples of on-line businesses that have figured out ways to harness the power of desire lines.  As Eric von Hippel, author of “Democratizing Innovation” (NYT Monday October 26, 2009) put it,  “Twitter’s smart enough, or lucky enough, to say, ‘Gee, let’s not try to compete with our users in designing this stuff, let’s outsource design to them.’”  The same thing can be said of many newer on-line businesses.  In an environment of transparency, where the behaviors of millions of people can be tracked and translated into data, the strange attractors become easier and easier to understand.

And if you can find the desire line – you can build new products, new services, new ideas that have already been “bought” by everyone else…that have already been innovated for you.

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Value creating CEO – Steve Jobs, Innovation and Apple

November 18th, 2009

Adam Hartung head shot

By Adam Hartung

$150billion. That’s a lot of money.  And that’s how much shareholder value has increased at Apple since Steve Jobs returned as CEO. Can you think of any other CEO that has aided shareholder wealth so much?  Do any of the cost cutting CEOs in manufacturing companies, financial services firms, or media companies see their share prices rising like Apple’s?

Fortune has declared this “The Decade of Steve“ in its latest publication at Money.CNN.com.  Such over-the-top statements are by nature intended to sell magazines (or draw page hits).  But the writer makes the valid point that very few leaders impact their industry like Apple has the computer industry, under Jobs leadership. Under his leadership Apple has also had a dramatic impact on the restructuring of two other industries - music and mobile phones/computing.  Another company Mr. Jobs founded, Pixar, had a major impact on restructuring the movie business. So with Mr. Jobs as leader, no less than 4 industries have been dramatically changed – and huge value created for shareholders.

No cost-cutting CEO, no “focus on the core” CEO, no “execution” CEO can claim to have made the kind of industry changes that have occurred through businesses led by Steve Jobs.  And none of those CEO profiles can say they have created the shareholder value Mr. Jobs has created. While Microsoft’s value has declined the last decade, Apple’s has almost caught up with the innovation-lacking behemoth.  Today Apple has more cash and marketable securities than the entire value of the historically supply-chain driven Dell Corporation.

Mr. Jobs is constantly pushing his organization to focus on the future rather than past products and customer requests.  It was a decade ago that Apple created its “digital lifestyle” scenario of the future, which opened Apple’s organization to being much more than Macs.  Jobs obsesses about competitors and forces his employees to do the same, to make sure Apple doesn’t grow complacent he pushes all products to have leading edge components.  Mr. Jobs embraces Disruption, doesn’t fear seeing it in his company, doesn’t mind it amongst his people, and works to create it in his markets.  And he makes sure Apple constantly keeps White Space projects open and working to see what works with customers – testing and trying new things all the time in the marketplace.

Almost bankrupt a decade ago, it wasn’t financial re-engineering that saved Apple. It was launching new products that met emerging needs.  Apple showed any company can turn itself around if it follows the right steps.Value is not created by cost cutting and waiting for the recession to end.  Value is created by seeking innovations and creating an organization that can implement them. Especially Disruptive ones.

Whether Steven Jobs is CEO of the decade or not I can’t answer.  But saying he’s one heck of a good role model for what leaders should be doing to create value in their companies is undoubtedly true.

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