“Innovation is the specific instrument of entrepreneurship, the act that endows resources with a new capacity to create wealth.” -Peter Drucker
“The only worse design than a pie chart is several of them.” -Edward Tufte
One of my favorite hobbies is oversimplifying the world, and I’ve decided to share my latest instance. Two very different kinds of thinkers exist; I call them Pie Charts and Venn Diagrams. How are they alike, how do they differ, and which one is your default thought process?
A Pie Chart is useful for gaining perspective on the distribution of a resource. It shows the relative percentage that each portion of a finite thing is allotted within the whole. While it can identify how large an opportunity is today relative to other parts, the universe could change tomorrow, e.g., the size of the pie may increase or diminish.
A Venn Diagram illustrates how two or more things are related. Are they separate? Do they overlap? If they overlap, then to what extent? The Diagram evolves as the size of each circle changes, as the degree to which they overlap grows or diminishes, or as a new circle is introduced.
How does using a Pie Chart versus a Venn Diagrams influence our imagination?
Pie Chart thinking constrains your vision to that which already exists. An everyday example is seen in political economics. Portraying the U.S. economy as a zero sum game (i.e. a pie chart) manipulates us into focusing on how someone is taking our piece of the scarce resources that constitute the pie. In business, the outcome of Pie Chart thinking is usually suboptimal. For example, when a company’s only growth option is “more of the same” or “sell harder,” a Pie Chart mindset is behind it.
Remember “think out of the box”? A Pie Chart is the box outside of which we need to think all the time, not just during brainstorming sessions at offsite retreats. Venn Diagram thinking enables you to break out of the box by forcing you to consider which of several circles you will include. The size of each circle is unbounded, and the overlap between them is dynamic. Venn Diagram thinking empowers us to envision how we can grow the pie, while Pie Chart thinking inhibits innovation by limiting our consideration of alternatives.
Understanding the difference between these two modes of thought elevates our vision. Consider the effect of Pie Chart thinking versus Venn Diagram thinking on what we choose to emphasize, on the perspective we bring, and on the outcome we experience:
Pie Charts emphasize how two things are different; Venn Diagrams encourage a search for synergy. Pie Charts constrain us to a finite perspective; Venn Diagrams encourage us to include more factors. Pie Charts divide the whole into its constituent parts; Venn Diagrams influence us to identify common interests and create unity.
How can we apply this heightened vision to lead our companies more effectively? Here are a few examples:
- Organizational Dynamics: Root out instances of narrow, self-interested departmental silos (Pie Chart) and replace them with improved collaboration and common commitment (Venn Diagram).
- Product Management: Notice when product managers focus very narrowly on their own product lines (Pie Chart) and encourage them to see consider whether the combination of their products with additional products and services can accelerate growth (Venn Diagram).
- Strategic Partnerships: When a manager is at an impasse trying to grow the business using available resources (Pie Chart), identify a compelling reason that a partnering company would share needed resources (Venn Diagram).
Every man must decide whether he will walk in the light of creative altruism or the darkness of destructive selfishness.
–Martin Luther King Jr.
In his recent bestselling book entitled Give and Take, organizational psychologist Adam Grant divides people into givers, takers, and matchers, then analyzes how each type defines and achieves success. His descriptions and rich examples provide critical insight for CEOs into how their leadership style impacts their organization and its success.
In ten years of studying reciprocity in organizations, Grant has identified three fundamental styles. While each of us may use all three styles on occasion, we tend to use one of these primary interaction styles:
- Takers like to get more than they give;
- Givers prefer to give more than they get, and
- Matchers seek an equal balance of giving and getting.
Examples of takers abound. Although most of us possess a kind of “justice radar” protecting us from predatory types, many takers are good at hiding their true nature. The Achilles heel for takers, however, is that they can’t help themselves and eventually display evidence of their true nature. The late Ken Lay of Enron is cited as a perfect example of a taker in giver’s clothing, often able to ingratiate himself to those in a position to help him. Eventually, though, public company taker CEOs expose their attitude that they are the “suns in their companies solar systems.” Useful unobtrusive measures cited by the author are the size of the CEO’s picture in the annual report, the CEO’s overuse of first person pronouns when describing the company’s progress, and the high degree of compensation the CEO receives relative to his direct reports. For example, taker CEOs tend to earn 3 times as much as the next highest paid executive, while the multiple averages 1.5 for givers.
CEOs who are givers can be harder to detect but refreshing to find. Grant describes a number of giver CEOs who have been very successful while giving much to those around them. Jon Huntsman and David Hornik are two of a number of business leaders mentioned who have succeeded through their unselfish support of those around them.
Matchers “operate on the principle of fairness: when they help others, they protect themselves by seeking reciprocity.” You can tell you’e a matcher if you continually seek to create an even exchange of favors, rather than looking for an advantage for yourself or not keeping score at all. Often, givers become matchers when they have to deal with takers, in order to protect their interests from being bulldozed.
Which style produces the least successful people? Which style is practiced by the most successful? Surprisingly, in both instances, it’s the givers. Two types of givers emerged: selfless givers and other-focused givers. Selfless givers have “high other-interest and low self-interest… and they pay a price for it. Selfless giving is a form of pathological altruism.” Giving without any getting eventually leads to burnout. The real winners are other-focused givers. As Grant puts it, “if takers are selfish and failed givers are selfless, successful givers are otherish: they care about benefiting others, but they also have ambitious goals for advancing their own interests.” Otherish is a term he uses to describe these winning givers who, while they aren’t selfless, they “help with no strings attached; they’re just careful not to overextend themselves along the way.”
Grant offers practical actions you can take to leverage the insight provided by the book. Here are a few:
Test Your Giver Quotient – He provides online self-assessment tools at www.giveandtake.com that you and people in your network can take to rate your reciprocity style.
Run a Reciprocity Ring – What would happen if groups of people in your organization met weekly for 20 minutes to make requests and help each other fulfill them?
Help Other People Craft Their Jobs to Incorporate More Giving – A VP at a large multinational retailers met one-on-one with each of his employees and asked them what they would enjoy doing that might also benefit other people.
Embrace the Five-Minute Favor – Ask people what they need and look for ways to help that are valuable to them but have minimal cost to you.
If you’re interested in moving your business forward using practical knowledge based upon social psychological research, you’ll find Give and Take highly thought-provoking and beneficial.
While the latest formula or insight sells business books, most business leaders tend to find their own way, then apply and reapply principles that emerge through their experience.
James Weaver is a serial CEO who’s led multiple companies out of deep holes back to relevance and profitability. He’s one of those gifted CEO’s who quickly finds the right course of action for a failing company and leads the organization to a new and better way to operate.
When I invited him to participate in a book of CEO principles I’m assembling called Shoot the Runt, he suggested a topic immediately. In turning around companies like Gold’s Gym, James developed a mindset and process that encourages everyone in the organization to achieve their highest potential, and he was generous in sharing that process to help the book.
James found repeated success by generating a sense of accountability that drives organizations to new heights of success. Check out the latest CEO/mentor dialog called Mutual Accountability Magic that’s based on the process he’s used successfully multiple times.
If you’re a CEO, you may have days when you’d be ecstatic to learn that instant teamwork would happen by simply asking each employee to take a pill. That day may be imminent, but recent research points to ways you can get more cooperation without prescription meds.
Paul Zak organized and leads the first doctoral program in neuroeconomics at Claremont Graduate University. In 2004, his lab discovered the role that the brain chemical oxytocin plays in enabling us to determine who to trust – the higher the level of the hormone, the greater the degree of trust. He’s worked for years to understand the connection between brain chemistry and decision-making, and how that ultimately affects our economic system.
The research around the hormone oxytocin provides a neurochemical understanding of important management principles that have evolved over the years. For example, keeping employees engaged in the outcome of the project they’re working on yields more success. Dr. Zak suggests that team leaders identify goals, establish how those goals will be reached, and put stress on each individual by explaining his/her role in achieving the group’s success. “Clear outcome measures build trust.”
Even more interesting is the work his lab has done in determining the effect that social media has on oxytocin levels in the brain. The findings show that oxytocin goes up during the use of social media, and furthermore, the precise level correlates with the subject’s perceived closeness to the person he/she is engaged with.
A video interview conducted by Harvard Business Review gives more detail. To oversimplify his conclusions, be nice to those around you. It’ll make you and your employees feel better and you’ll both produce more.
In this video interview, researcher Paul Zak describes recent findings about how oxytocin encourages cooperation in the workplace and how its level is affected by the use of social media.