Three Traps: Complacency, Cannibalization, Competency

The Three-Box Solution: A Strategy for Leading Innovation by Vijay Govindarajan is a great book to help leader innovate with simple and proven methods for allocating an organization’s energy, time, and resources across the three boxes:

Box 1: The present—Strengthen the core

Box 2: The past— Let go of the practices that fuel the core business but fail the new one

Box 3: The future—Invent a new business model.

Below is an excerpt on the three behavior traps. How do you manage them to the lead your organization to innovate?

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While there were many within IBM who clearly understood the implications of both nonlinear shifts, their insights had difficulty penetrating the entrenched logic of the past. The dominant logic of the past exerts its hold on business cultures and practices in three distinctive but tightly interlocking ways. I think of their dynamic effects as traps that snare the unprepared. All three have common origins in mind-sets that focus excessively on past values, behavior, and beliefs.

The Complacency Trap

Current success conditions a business to suppose that securing the future requires nothing more than repeating what it did to succeed in the past. This is the complacency trap. Complacency shrouds the future in a fog of misplaced confidence, hiding from view a clear understanding of the extent to which the world is changing around you.

IBM’s extraordinary success driving revenues in its Box 1 mainframe business masked difficulties to come. Rather than face up to looming threats to the mainframe business, IBM applied temporary patches. One such patch ‘was to change the revenue model from leasing mainframes to selling them outright. S This produced a pleasing surge in near-term revenues that postponed IBM’s day of reckoning.

The loyalty of successful organizations to the past is often so potent that they become quite ingenious at ignoring the onset of fatigue in the Box 1 business. Instead of building the future day by day, IBM prolonged it’s past with what amounted to an accounting change. The resulting years-long period of bolstered revenues made it easy for the company to think that everything was just fine-four words that fairly summarize complacency.

Another way to understand how IBM fell into the complacency trap is that the company’s continuing Box 1 profitability delayed development of a sense of urgency that might have motivated a more prescient Box 2 judgment: that it was important to invest aggressively in the new enterprise model of client/server computing.

This is the dark side of success. No matter the industry or company, each great innovation spawns a steady accumulation of Box I-based structures, processes, and attitudes of the kind that blinded IBM to its predicament. IBM mainframes were not simply smart machines; they were smart machines that over the years had created at customer work sites whole new layers of enterprise management that had never existed before.

Mainframe computers were island fortresses, secured and operated by a newly empowered IT function and inaccessible, except through IT proxies, to the rest of the enterprise. If a technology can embody a governing philosophy, the mainframe’s philosophy was exactly opposite that of the open, accessible internet that was yet to appear. Even before the internet emerged as a business tool, there were pitched battles within almost every company about making valuable mainframe data accessible to and usable by employees with networked PCs. This increasingly loud demand clashed with the mind-set of IBM’s IT customers, who saw their mission as protecting the security and integrity of corporate data: allowing liberal access would lead to data corruption and to proliferating unreliable versions of the “truth.”

In fact, customers can play an important role in deepening a complacency trap. IBM had collaborated with its customers in creating what became an entrenched system of governance for computerized organizations. That system’s structures and attitudes were a self-reinforcing feedback loop amplified by IBM’s large-enterprise customers.

Ultimately, a more modern version of the mainframe emerged and made peace with the rest of the IT infrastructure. Today’s version powers big data analytics and other applications in many large enterprises. But in the IBM of the 1990s, mainframes cast a long shadow over the emergent model of more open, democratized network computing.

The Cannibalization Trap

The cannibalization trap persuades leaders that new business models based on nonlinear ideas will jeopardize the firm’s present prosperity. So, like antibodies attacking an invading virus, they protect the Box 1 business by resisting ideas that don’t conform to models of the past.

At its heart, the fear of cannibalization reflects a wish to keep the world from changing. It is perhaps easy to understand that wish, but it’s much harder to excuse it. The glib answer to those who suffer from this fear is to remind them that change is inevitable and the world will change either with them or without them. When a business allows worries about cannibalization to interfere with its strategy, it has overinvested in its past and is doomed to undermine its future.

Cannibalization is typically understood-and feared-as a near-term threat. As foresighted as IBM was in developing its personal computer in the early 1980s, forces marshaled within the company to protect the legacy business. Those who feared the PC believed it had the potential to threaten the mainframe computing model, perhaps by feeding the growing appetite to liberate enterprise data or by diverting attention and investment away from the company’s dominant business.

People who fear new technology are usually more right than wrong about its potential to supersede legacy products. The truth is, every Box 1 business has reason to fear, sometimes even hate, whatever shiny new thing is being launched. When Steve Jobs gave a big push to the Macintosh launch toward the end of his first stint at Apple, the group in charge of the incumbent Apple II felt threatened and undercut. It was as if cofounder Jobs had sponsored an insurrection.”

In reality, however, cannibalization should be understood as a long- term benefit. The new Apple Macintosh embodied features that soon enough would make its predecessors obsolete. If Apple hadn’t moved quickly, a competitor-maybe even IBM-would have filled the vacuum. Given its history, IBM’s embrace of microcomputing was unexpected. But it quickly set the standard for PCs and legitimized them as tools for both home and business users. While IBM’s marketing of the PC initially tilted toward home users, the real revenue bonanza came from businesses. Suddenly, at least part of IBM had reason to root for client/ server computing. No matter what anyone in the mainframe business thought about it, the client/server model had the shine of inevitability.

So, while companies must take the fear of cannibalization seriously as a problem to manage, it can’t become a reason not to act with foresight when new nonlinear strategies or business models present an opportunity.

The Competency Trap

The competency trap arises when positive results the current core business encourage the organization to invest mainly in Box 1 competencies and provide little incentive for investing in new and future-oriented competencies. In established companies built around a spectacular success, such as IBM’s industry-defining mainframe computers, it is natural to want to create a workforce whose skills dominantly reflect the legacy success. But a competency trap is a double- edged sword. IBM’s investments in Box 1 competencies helped its mainframe business. But Box 1 logic asks, why invest in skills not vital to the company’s current profitability? That is why Box 2 is necessary.

IBM eventually recognized that the dominant computing model it had exploited to achieve such great success was changing. Yet, despite having made significant investments in a robust R&D function, it was having chronic difficulty incubating new ventures. It struggled to find what IBM insiders called “The Next Big Thing.” The organization appeared to have succumbed to a “four monkeys” value system.

Believing that there were indeed systemic problems, then-CEO Louis Gerstner commissioned an internal inquiry to identify root causes. The inquiry, led by Bruce Harreld, IBM’s head of corporate strategy, confirmed Gerstner’s fears. Looking at a number of recent examples of flawed new-business incubation, Harreld’s team concluded that the company’s dominant Box 1 systems, structures, processes, and culture had:

  • Created a powerful bias for near-term results.
  • Encouraged a focus on existing customers and offerings to the extent that new technologies and nonlinear trends were either underestimated or escaped detection entirely.
  • Burdened new businesses with unreasonably high performance goals-especially damaging to ventures that targeted newer, riskier, but often more promising markets.
  • Motivated an unimaginative approach to market analysis that impaired the company’s ability to understand the sorts of “embryonic markets” most likely to spawn nonlinear Box 3 ideas.
  • Interfered with development of the skills necessary to adaptively transition a new business through its emergent and growth stages until it finally became an established enterprise.
  • Caused assorted failures of execution, many owing to the inflexibility of Box l=driven organizational structures, which leaders of new ventures “were expected to rise above … Voicing concerns over [such challenges], even when they were major barriers to new business initiatives, was seen as a sign of weakness.”

What the report didn’t say is important to note. IBM’s problem was not caused by a lack of research competency. On the contrary, its workforce possessed at least some expertise in a wide array of disciplines and technologies. Among its research projects were some that were quite promising and others that were highly speculative, unproven, and obscure. But for all the reasons listed, even ideas that managed to get traction were being ineptly developed and executed. What IBM needed was a well-designed process for enabling, supporting, and rewarding its maverick monkeys and likewise for managing new ventures onward through their developmental stages.

Such a process typically should incorporate a range of structural, cultural, and leadership remedies. At IBM-first under Gerstner and later Sam Palmisano-these distinctive remedies came together under the emerging business opportunities (EBO) framework, which created new structures, changes to the buttoned-down IBM culture, and more versatile and adaptive leadership behavior.

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HBR: Ineffective Sales Leaders Can Cause Lasting Damage

Is your vison or strategy going in the right direction? Are you retaining the right talent? Are you serving your customers? Or managing your sales team badly? Is your culture wrong for your vision and strategy? Below is a blog from the Harvard Business Review by Andris A. Zoltners, Sally E. Lorimer, PK Sinha.

Ineffective Sales Leaders Can Cause Lasting Damage

Success in a sales force requires having strong talent up and down the organization. A weak salesperson will weaken a sales territory, a bad sales manager will damage their team and dampen results in their region, and a poor sales leader will eventually ruin the entire sales force. For even the most seasoned among us, it can be difficult to recognize the signs of a poor sales leader and the possible damage the person can do — especially when they appear to do some good early on.

Consider two examples.

An education technology startup hired a sales leader who came from a large, well-respected firm. He had extensive market knowledge and a stellar track record. Although good at scaling and operating a sales organization, the leader was unable to succeed in a rapidly changing environment that needed experimentation and nimbleness. The mismatch between the startup’s need and the leader’s capabilities set progress back at least a year.

A medical device company hired a vice president of sales with an intimidating management style. He ruled by fear. Achieving goals was everything. He tolerated (and even encouraged) ethically questionable sales practices. Results looked excellent at first, but the sales culture became so unpleasant that good performers began leaving in a trickle, and then in a flood. The average tenure of salespeople dwindled to just seven months. The damage to the company continued for years after the VP was replaced.

The reasons that sales leaders fail fall into four categories:

  • Direction. Poor understanding of the business, leading to errors in vision and strategy
  • Talent. Inability to pick and keep the right people for the team
  • Execution. Poor processes serve customers and manage people badly
  • Culture. Inappropriate values damage the very core of the organization

When such failures are coupled with a leader’s egotism or lack of self-awareness, it’s unlikely that the leader can lean on others to overcome his own deficiencies.

Yet ineffective leaders can do some good in sales organizations. They can bring about needed change quickly. Leaders who lack sensitivity have an easier time eliminating poor performers. Leaders who are intimidating can use their muscle to implement difficult changes that past leaders avoided — for example, an organizational restructure that disrupts an existing power hierarchy.

But unless a poor leader can overcome or compensate for his deficiencies, eventually the bad will overpower any temporary good. A tyrant, for example, may fix some things in the short term but create other problems at the same time. For every gain, there are likely to be multiple missteps with the sales force’s vision, team, execution, and culture. A key and very visible marker of ongoing or impending trouble is when talented people on the leader’s team become frustrated and depart the company.

It can take years to repair the damage done by an ineffective sales leader.

First, it takes time to replace the leader and reconstruct the sales team. When a health care company hired the wrong leader for a sales region, it took more than three years to rebuild the team and recover from the initial error of putting the wrong person in charge.

Second, it takes time to reverse the questionable decisions that ineffective sales leaders make, especially decisions that affect sales force structure or compensation. Weak leaders at a technology company made a decision to restructure the sales organization using a model from their own past that did not match the current situation. Again, it took more than three years to undo the damage.

Third, it takes time to rebuild the culture a poor leader creates. Poor leadership at a medical device company had allowed an unhealthy “victim” culture to pervade the sales force. Salespeople had no confidence in their leaders, and managers were willing to accept salespeople’s constant excuses for poor performance.

Bringing about change required replacing the company’s president, followed by more than two years of sustained focus on transforming the sales force using the following process:

  1. Create a fresh vision, reflecting a culture in which salespeople trusted their leaders and in which all salespeople were held accountable for results.
  2. Communicate the vision using every opportunity, including sales meetings, videoconferences, and the company’s intranet.
  3. Rebuild the team starting with a new vice president of sales who had integrity and judgment, and was willing to replace anyone on the sales team who could not adapt to the new culture.
  4. Realign sales support systems and rewards by overhauling the systems for recognizing and rewarding performance and creating accountability.

These four steps are a good starting point for any company seeking to recover from poor sales leadership.

Bad sales leaders can sometimes bring about change in a broken environment and make temporary gains. But they will wreck a sales force unless they are replaced quickly.

HBR: How to Speak Up If You See Bias at Work

Does unchecked biased and/or offensive behavior make you uncomfortable at work? Below is a blog from the Harvard Business Review by Amber Lee Williams.

How to Speak Up If You See Bias at Work

Many people can recall a time when they were exposed to workplace behavior that made them or others uncomfortable. Can you think of a time someone in a meeting joked about another group of people, evoking laughter from everyone else in the room? Or have you worked on a team in which the men seemed to get better projects even though female colleagues were equally or better suited for the work?

And the big question: Did you speak up?

There is no question that objecting to such situations is difficult. The person who decides to raise the issue could damage their relationship with the person making the comments or assigning the work, which could adversely impact the objector’s career opportunities. This is especially true when the comments or behavior aren’t technically illegal. It takes courage to be the one, perhaps the only one, who calls out the behavior as unhelpful to a productive work environment.

So why take the risk? Why not simply ignore the behavior — especially if you’re not the target of it? First, failure to acknowledge and address bias or offensive behavior validates the conduct and may create an impression that the behavior is acceptable, and even to be expected, in the workplace. Moreover, normalizing offensive conduct in this subtle manner tends to have a chilling effect on other potential dissenters, and communicates to those who are offended, regardless of whether they are targets of the behavior, that their perspectives and voices are not valued. Remember that just because people laugh at an offensive joke doesn’t mean they agree with it — or weren’t offended themselves. They might be laughing to cover their discomfort or fit in with the group. In such an environment, employees who are would-be dissenters but are fearful of speaking up may find it difficult to fully engage with their coworkers and leaders and may become less productive.

The bottom line is that patterns of unchecked biased and offensive behavior in the workplace have the potential to erode full employee participation and take a toll on organizational effectiveness.

Given the risks and challenges, how can you draw attention to the bias or offensiveness without putting the other person on the defensive? What are some approaches most likely to limit unintended adverse consequences? There is no one answer or approach that will work for everyone in every situation. Nonetheless, you do have the power to manage how, when, and to whom to raise concerns in ways that will encourage positive change in your environment.

Choose your audience carefully. Sometimes the person you perceive as the offender is not the audience to whom you should address your concerns. If the person making an off-color or offensive joke is a peer or subordinate, it can be effective to directly — but respectfully and privately — address the issue with them. However, in the instance of a person who appears to be assigning work in a discriminatory manner, if the person is a superior or has more power than you do, it may be more prudent to identify a trusted ally in your organization — someone who can provide support, help to identify the right person to speak with about the issue, or maybe even raise the issue on your behalf.

Keep a cool head. Whether you are discussing the issue directly with the person whose conduct is offensive or sharing the situation with an ally, it is important to remain calm. It is not unusual for a person who has observed or been targeted by biased or offensive behavior to feel emotional about the situation. However, sometimes an emotional response to a difficult situation inadvertently shifts the focus of a discussion from problematic behavior to other person’s response to that behavior, which then impedes their ability to address and correct the conduct. It is worth stepping back, working through your emotions, and taking the time to plan what you want to communicate to ensure that the content of your message is not undermined by its delivery.

Create the opportunity for dialogue. You do not have to be provocative or accusatory to raise a concern about discriminatory and offensive conduct. At its core, biased and offensive language and conduct are disrespectful. If the goal is to create a different dynamic, it is counterproductive to attack, demean, and disrespect a person who says or does something offensive. A better approach is to model the behavior you want to see.

For instance, instead of calling someone sexist for giving the plum assignments to the men on the team, you might mention a qualified female colleague who would be an asset to the team. If the supervisor questions the colleague’s qualifications or readiness, point out how participating on the team could further develop her skills, and offer to mentor her.

For the colleague who makes off-color jokes, if you decide to address them directly, you might privately share with the person that their comments make you uncomfortable and suggest the person discontinue the language. If the person asks why you’re uncomfortable, you can share that you do not think it’s appropriate to make jokes at the expense of other groups and that the behavior is offensive and distracting.

Be willing to listen to the other person’s side (e.g., they were only making a joke, you’re being too sensitive, words don’t hurt anyone) — even if you do not agree. Listening to others’ perspectives is essential for creating an environment where all voices are heard and respected.

It takes courage to address biased and offensive language and conduct in the workplace. Relationships and career opportunities potentially hang in the balance. But isn’t it worth it to consider taking the risk in order to achieve full employee engagement and organizational effectiveness?

HBR: Build a Great Company Culture with Help from Technology

Are you making sure employees are challenged, motivated, engaged, and know that they are contributing to the overall success of the company? Below is a blog from the Harvard Business Review by Ashley Goldsmith and Leighanne Levensaler

Build a Great Company Culture with Help from Technology

Culture, and how to build and sustain one, is one of the toughest challenges for managers, especially in today’s fast-paced, highly competitive organizations. Every organization wants to create a culture that works from a set of core values, where everybody is on the same page about what’s important, where the company is going, and how it’s going to get there. But what happens when the external competitive environment — and the direction of the company — changes? And what happens as advances in technology constantly change how customers and employees expect to interact with your company? How do you manage the evolution of your company’s culture, and hold on to what makes you great, even as you change and grow?

Here at Workday, these questions have been central to our existence from day one. We were founded in 2005, and our cofounders, Aneel Bhusri and Dave Duffield who were both already highly successful entrepreneurs, understood that any successful culture would be built on a core set of values. For us, those values are employees, customer service, integrity, innovation, fun, and profitability. We are certain that our high customer satisfaction ratings and top spot on many best-place-to-work lists come from our early recognition that culture permeates every sales call, every employee interaction, and every product innovation.

As a provider of cloud-based finance and HR applications designed to help companies change and grow, our customers rightly expect us to lead by example. At the same time, we listen closely to our customers’ business challenges and successes — which in turn helps us change and grow.

While we hold on tightly to our core values, we strive to keep evolving our culture to meet the changing needs of our employees and customers. Perhaps not too surprisingly, technology plays a central role (after all, we’re a technology company). But if you asked most people to list the things that create and maintain a strong company culture, chances are they wouldn’t list technology. We’ve found that you can’t create a culture just through values, new processes, or an organizational restructure. Those things are necessary, but we like to think of values as the beating heart of culture, processes and organizational structure as the brain, and technology as the nervous system that makes sure heart and head are working together to move us forward.

For us, giving our people tools that empower them to work how they want to work — in everything from finding their next career opportunity, to hiring their next employee, to making data-driven day-to-day business decisions — is critical to holding on to the integrity of our culture in a fast-changing environment. This culture of empowerment has helped keep the company true to the core values on which we were originally founded. Here are the main components of that culture, and how they work:

Democratization of information. In their personal lives, people have become accustomed to having access to any piece of information they want at a moment’s notice. This hasn’t always been the case in the workplace. Data was usually kept in the hands of a select few, and extracting and using that data in a meaningful way was a long, painful process. But modern enterprise technologies and applications are pushing access to data and information to the front lines.

One area we see this playing out is within our own HR organization. At Workday, managers don’t have to spend valuable time with HR discussing headcount or status updates on new job openings — they already have this information at their fingertips. Instead, managers can spend their time with HR talking about how to get top performers to the next level, keep people who are at risk of leaving the organization, and align workers to meet business objectives. They can focus on creating value for the business by mobilizing talent.

Another area where this plays out is in hiring. When it comes to recruiting for fast-growing companies, talent acquisition needs to be efficient without sacrificing quality. Our managers can see all interview, resume, and references information in one place from any device, anywhere. Whether sitting on a plane or walking between meetings, a manager can immediately see the hiring team’s feedback and decide whether to move a candidate forward with a tap of their phone.

It’s good for any company to be able to make faster decisions based on immediate access to data, but it’s also good for the candidate — no repeated requests for a resume or work samples, no making them wait longer than necessary for news about next steps. And, with the race for top talent, speed-to-hire is crucial. And this says something to a candidate about our culture right from the start: We move quickly and we respect your time.

This democratization of information also enables greater transparency, which is critical to sustaining a positive culture. For example, we conduct online chat sessions that provide employees with the opportunity to ask our top executives whatever questions are on their minds. This is done in the spirit of keeping employees informed and is at the center of everything we do.

Culture of opportunity. Another area we’re passionate about is creating what we call a culture of opportunity. We’re not about stringent policies or old-fashioned career paths. We’re about being transparent about new positions and opportunities that exist within the organization and then providing the tools and information our people need to pursue them.

For example, we are rolling out a tool that will give employees a personalized view of positions within Workday that are a good fit for them based on the actual movement and success of other employees who held similar positions. Besides a real-time glimpse into the vitality of the company and how it’s evolving, it’s an employee-centric view of possible career paths.

An employee can not only see what moves others have made, they can also reach out and connect to those specific individuals to talk with them about their experience. With a tap you can introduce yourself to set up time to connect or simply ask a question.

And as mentioned earlier, we listen to and learn from customers. Adobe, for example, often “pulses” its employees to get quick feedback on their experience. We were inspired by this approach when we built a tool that we use to ask one or two simple questions that can be answered via any device in a few seconds such as, “Has your manager talked to you about your career goals in the last month?” Our aim is to quickly and easily capture employee sentiment so that we can calibrate our efforts to reinforce our culture.

Performance enablement. For us, performance enablement is an evolution of the traditional performance management process that stresses regular, ongoing feedback, and takes an employee-centric approach to helping our people thrive. Several of our customers, like Ellie Mae, are passionate about this approach as well and have set a great example to follow.

Measuring an employee’s impact is more efficient and ultimately more effective thanks to tools and technology that allow us to regularly capture and aggregate real-time information.

The annual review process at some companies is not very transparent — and, there can be demoralizing surprises. It can also be demoralizing to only receive feedback once or twice a year. We now expect managers to have regular check-ins with their direct hires, ideally on a bi-weekly basis.

It doesn’t make sense to only flag areas for improvement once a year, and more often than not, an early course correction heads off bigger issues. By the same token, there are many positive behaviors, such as suggestions for process improvement or innovation, which might not get immediate feedback in a more traditional environment that are important to encourage.

From a manager’s point of view, regular check-ins give more visibility into not just their team, but how their workers are interacting with other parts of the organization.

In the end, our goal is to hire and retain the best people in order to provide the best service to our customers. To do this, we need to keep our employees happy, make sure they are challenged, motivated, and engaged, and know that they are contributing to the overall success of the company. We want to keep learning, adapting, and listening to our people as we grow. We know that technology is most effective when it’s designed to support and encourage the behaviors and processes that lead to innovation — and we believe that this is what will continue to foster our great company culture.

 

Managing Polarities: A Key Skill for the Well-Intentioned Manager

Blanchard LeaderChat

What Comes After Plan B?Being a great manager means balancing the needs of your people with the results you are trying to achieve. This can be a fiendishly hard balance to strike, and maintain. For example:

As managers we are expected to have the best interest of the organization as a prime objective and yet the needs of each of our direct reports are also critical. The process of balancing both is a polarity because it involves two, interdependent, correct answers to the question: “In my relationship with this person, should I be concerned about her, or should I be concerned about her ability to perform her tasks?”

As a well-intentioned manager, you need to pay attention to your people’s needs, and you need to keep an eye on the extent to which things are actually getting done. If you just take care of your direct report and neglect the tasks at hand, it won’t…

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How Happy Is Your Organization?

How did you celebrate the first day of The International Day of Happiness? What questions do you ask to know if your organization has a happy environment? Below is a blog post for Harvard Business Review by Susan David.

 

How Happy Is Your Organization?how to stay positive

Today, March 20, 2013, marks the first ever International Day of Happiness. This was decreed last year by the United Nations following a meeting on well-being attended by government officials, economists, scholars, and business and spiritual leaders from around the world. It was hosted by Bhutan, a small but visionary country which famously uses Gross National Happiness (GNH) instead of Gross Domestic Product (GDP) to index its progress.

The King of Bhutan, Jigme Khesar, has described GNH as “the bridge between the fundamental values of kindness, equality and humanity and the necessary pursuit of economic growth.” He’s talking, of course, about the well-documented connection between well-being and productivity — an interplay that should interest business leaders as much as it does political ones. As this issue of HBR makes clear, happy, engaged employees are good for the organization. Research shows they have better health, are more creative, produce better results, and are willing to go the extra mile. What’s more, happiness is contagious; it creates a virtuous spiral that leads to further engagement.

So how can leaders create happier organizations?

Perhaps the first step is to clarify what we mean by “happy”. Psychologists typically identify happiness by three distinct pathways. The first is the pleasant life, which involves positive experiences including contentment, hope, and sensory enjoyment. This kind of well-being is often referred to as hedonia, based on the Greek term for pleasure. The second is the engaged life, or eudaimonia. The ancient Greeks believed in a “daimon”, or guardian spirit, that would guide you toward your destiny; the word also means genius. The engaged life thus refers to a person’s ability to deploy his personal genius — to use his unique strengths and talents in a way that engages and absorbs him. The third pathway is the meaningful life, which relates to the desire to be part of something bigger than oneself — to belong and contribute to an institution that has purpose.

All three of these pathways — pleasure, engagement, and meaning — are important. And business leaders can use this knowledge to ask some important questions about their organizations:

Do my employees enjoy their relationships and their environment at work?

Do they laugh?

Are my people in the right roles — ones that fit their skill sets and offer appropriate challenge?

Do they get to use their genius?

Do they understand the purpose of the organization?

Do they feel they’re a part of something that matters?

On this first International Day of Happiness, it’s worth pausing to consider what contributes to happiness in your organization — your own happiness, as well as that of the people around you. I hope you will share what you discover.