Your latest book is about ‘clever people’ and the challenges involved in leading them. How do you define clever?
Clever people are employees whose skills are not easily replicated and who add disproportionate value to their organizations. Often, these people are smarter than their bosses and most of them don’t really want to be ‘led’. That’s what they say, anyway; whether or not they mean it is another question. The ones we studied for our book actually needed organizations in order to express their skills and talents. For instance, if you’re a brilliant pharmaceutical researcher, you can’t produce the next great breakthrough drug on your own; you need the resources of a large pharma company and you need to work in a big, global team – typically for seven or eight years. Maybe then you’ll get to work on that breakthrough drug. We have found that many kinds of cleverness these days are organizationally dependent. My coauthor and I were interested in that sort of slightly edgy relationship that clever people have with those who employ them: they need organizations but they often don’t really want to be in them.
Describe the rise of what you have called ‘the clever economy’. It is very closely related to the Knowledge Economy, which most people know about. Organizations are increasingly full of well-educated people with second or third degrees – MBAs, PhDs and so on. For our last book [Why Should Anyone Be Led by You?] we studied the BBC, Roche Pharma Company and WPP (the world’s largest marketing services agency.) What do these organizations have in common, you might ask? They’re stuffed full of clever people: the BBC is brimming with clever, creative broadcasters and media content producers and so on; Roche is full of clever pharmaceutical researchers; and WPP is full of creative and marketing geniuses. Frankly, the people most likely to ask the question posed by our last book are these clever, slightly edgy and sometimes difficult types.
Despite the fact that we predict a growing Knowledge Economy, the field of study in terms of leadership within cleverdominated organizations is very limited. There is plenty of research on leadership, and lots on the Knowledge Economy, but the two haven’t been brought together very well, and that’s why we wrote the book. The advanced industrial economies are unlikely to dig themselves out of their current hole by producing more motorcars: if we’re going to dig ourselves out it will be by getting cleverer at some of the clever stuFF that we do. A recent McKinsey study suggests that seven in ten new jobs generated in the United States in the last decade were ‘clever jobs’. We used to think that the future would be filled with McDonald’s-type jobs – low-skill service jobs – but that’s not what is happening at all. McKinsey defines ‘clever’ in terms of complex tasks, complex interfaces between tasks and lots of tested skill.
You touched on the fact that unlike artists or musicians – who can thrive on their own – clevers actually need organizations to thrive. Why is that? Typically, they need to work with other clevers in order to generate new products and knowledge. In many cases they are actually motivated by working with others who may be even cleverer than they are. We talk about Google in the book. I went to visit some of the people there at the headquarters in California. Not surprisingly, they are hiring the brightest postdoctoral students and researchers in the world; that’s who gets to work at Google. And guess what the first thing they notice when they arrive is? ‘Everyone here is cleverer than me!’ This is motivating for them, because clevers thrive when they feel surrounded by people just the same or even cleverer. That’s one of the reasons they need organizations. There are also more pragmatic reasons: they also need resources and they need organizations as a platform to achieve recognition. I’m doing some work with Louis Vuitton Moet Hennessey (LVMH), the world’s largest luxury goods company. One of the things they point out is that when they’re looking at creative directors, they’re looking for people who are not just creatively brilliant but who want to be famous. Organizations can be a fantastic platform for public recognition. Think of the wildlife programs that the BBC generates, which are sold all over the world. They’re all made down in Bristol in the west of England. The BBC provides these people with a wonderful platform to achieve worldwide recognition. So there are many reasons why clevers need organizations, even though they sometimes feel uncomfortable in them.
You say that clever people also have “enormous destructive potential.” How so? I suppose the most dramatic illustration is what recently happened to the global economy. Many of us are asking, ‘how could organizations that were so full of cleverness of one kind or another have gone so horribly wrong?’ Some of the financial service organizations, in particular, indicate the enormous destructive potential that exists within clever individuals. If you compared these firms to organizations that are producing, let’s say, routinized food commodities, they can be drifting in the wrong direction for years before they eventually get into trouble. But clever-dominated organizations are often as good as their last project, their last client engagement or their last hire. They succeed fast, but they can also go wrong fast, and that speed factor is one of the reasons why there needs to be a better understanding of how to lead these people.
On that note, leading clevers require some non-traditional leadership skills. Please describe a couple of them.
We have a full list of ‘do’s and don’ts’ in the book. We say things like: Do explain and persuade rather than tell people what to do; do use your expertise rather than rely on the hierarchy; do encourage failure to maximize learning. Don’t train. Now some people may think, ‘What, don’t train?’ What we mean is that a lot of clever people regard training programs as a kind of death. For example, with lawyers and doctors, if you mention a leadership training program they’ll go to sleep straight away. So do provide opportunities for clevers to learn within what they’re doing, and do give them recognition, but don’t try to train them.
Can an organization as a whole attain clever status? Definitely. We have defined three types of clever organizations, and all are filled with clever people that are unhappy with the status quo because they know that they, their teams and their organization can do even better. The first type of organization is ‘Clever Inc.’. This is the big, fast-moving manufacturing company that must move from the dominant economic model of the 20th century (effi ciency through scale) to the dominant imperative of the 21st century (the ability to leverage knowledge.) As a result, Clever Inc. must un-learn some of its habits. Nestlé is a prime example: it remains the world’s biggest food company but it still has room inside of it to make breakthrough innovations like Nespresso, which is an incredibly innovative product. It also still has room for a brilliant mergers and acquisitions team that continues to make creative acquisitions. Second is ‘Clever Services’. These firms are focused on the provision of standardized-but complex services and historically, they were built around highly-credentialed professional groups such as law, accounting and medicine. More recent additions include advertising, consulting and PR. Examples include PriceWaterhouseCoopers, KPMG and some of the world-class hospitals.
The third type of clever organization is the ‘Clever Collective’. These are much more freewheeling organizations, built on know-how rather than the effi ciencies of Clever Inc., and on networks rather than the hierarchies of Clever Services. Examples include Google and Microsoft, but you can find Clever Collectives buried within more established organizations as diverse as Johnson & Johnson, Roche and Oracle.
We believe that leading clever people is one of the greatest challenges facing organizations today. It requires huge personal sacrifice and humility on the part of the leader, but happily, it is also one of the most satisfying roles a leader can perform, because it is about working with the most talented individuals – people who are capable of incredible things. As you can imagine, the challenges of leading the M & A Team at Nestle, the doctors in a top hospital or the people producing the next Google breakthrough are quite varied. Leadership is always contextual, as is cleverness.
In the end, cleverness is not some sort of elixir of life, but the curiosity that is fundamental to it is the essential lifeblood of the modern organization. Understanding, organizing, leading and maximizing this is a great challenge. In the clever economy, only the curious will thrive.
Characteristics of Clever People Their cleverness is central to their identity. What they do is not some last-minute career choice, it is who they are. They are defined by their passion, not by their organization.
Their skills are not easily replicated. If they were, clevers would not be the scarce resource they are. Once upon a time, competitive advantage came because your product was slightly better or produced more cheaply; now it often comes through the collective efforts of the clever people in your organization.
They know their worth. The tacit skills of clever people are closer to the craft skills of the medieval period than they are to the codifiable and communicable skills that characterized the Industrial Revolution. This means you can’t transfer the knowledge without the people, and clever people know the value of this.
They ask difficult questions. Knowing your worth means that you are more willing to challenge and question. In particular, clevers instinctively challenge what came before them.
They are not impressed by corporate hierarchy. Clever people claim that they do not want to be led; and they are absolutely certain that they don’t want to be managed. They are also likely more concerned with what their professional peers think of them than their boss.
They expect instant access. As a leader, if you’re not there when the clevers come calling, don’t expect them to wait patiently in line; clever people have a very low boredom level.
They want to be connected to other clever people. Clever people cannot function in an intellectual vacuum. Typically, they possess only part of a clever solution – an important part, but one that requires the input of other clevers to come to life.