Aaron De Smet

What we found is teams with psychological safety and a supportive work environment actually benefit from being edgy and pushing to do better. But you put that same edge, that same kind of push, on a team that doesn’t have psychological safety or an open and supportive work environment, and it has the opposite effect. It actually makes the team go into a sort of … [ Read more ]

Aaron De Smet

If you want a test-and-learn environment, you have to make it OK to share failure, so that not only can I learn from failure but others can learn from my failure, and they don’t have to make the same mistakes I made.

Aaron De Smet

Sometimes we hear this thing about “embrace failure. Failure is good.” Actually, it’s not that failure is good. I, at least, don’t like failure. I like working with people who don’t like failure. But there’s a difference between not liking failure and having failure be taboo and not discussed or shared or learned from. If you never fail, you probably aren’t being bold enough.

Aaron De Smet

Transaction costs are now low enough that you can have a gig economy. We can create technology-enabled platforms that allow us to have collaboration at scale through nonemployees or quasi employees.

Now there were some economists who said that when transaction costs fall enough, the large employed workforces will go away. That was the prediction. I never agreed with it, because another reason why people work … [ Read more ]

Jacqueline Brassey, Aaron De Smet, Ashish Kothari, Johanne Lavoie, Marino Mugayar-Baldocchi, Sasha Zolley

Although resilience and adaptability are linked, they are different in important ways. Resilience often entails responding well to an external event, while adaptability moves us from enduring a challenge to thriving beyond it. We don’t just “bounce back” from difficult situations—we “bounce forward” into new realms, learning to be more adaptable as our circumstances evolve and change.

Redefining Corporate Functions to Better Support Strategy and Growth

Striking the right balance between decentralized functions and centralized control starts with addressing the needs of business units.

Aaron De Smet, Chris Gagnon, Elizabeth Mygatt

As the business environment has become more complex and interconnected in recent years, many companies have mirrored these changes in their organizational structures, creating an ever-more convoluted matrix. Unwittingly, they are betting on organizational complexity to solve market complexity.

This is a losing bet. Future-ready organizations, by contrast, structure themselves in ways that make them fitter, flatter, faster, and far better at unlocking considerable value. Their … [ Read more ]

Aaron De Smet, Chris Gagnon, Elizabeth Mygatt

Leaders hoping to create a robust performance culture need to start by cooking up their organization’s own unique “secret sauce.” The main ingredient: specific, observable behaviors that employees at all levels of the company adhere to.

Broad themes won’t cut it. Instead, behaviors must be made an integral part of core business activities and specific work tasks, especially for the moments that matter.

Aaron De Smet, Chris Gagnon, Elizabeth Mygatt

While all companies have a strategy for how they create value, few can show precisely how the organization will achieve it. Future-ready companies, by contrast, avoid this dilemma by creating a value agenda—a map that disaggregates a company’s ambitions and targets into tangible organizational elements such as business units, regions, product lines, and even key capabilities. Armed with such a depiction, these companies can articulate … [ Read more ]

Aaron De Smet, Chris Gagnon, Elizabeth Mygatt

Ronald Coase argued that corporations exist to avoid the transaction costs of the free market. Yet with transaction costs plummeting (spurred by rising connectivity) this rationale no longer holds up. Why, then, do companies exist?

The answer is identity. People long to belong, and they want to be part of something bigger than themselves. Companies that fixate only on profits will lose ground to organizations that … [ Read more ]

Aaron De Smet, Chris Gagnon, Elizabeth Mygatt

Ask executives about their company and you can expect to be shown an organization chart. No wonder. The management concepts that the org chart visualizes—coordination, hierarchy, a matrixed organization—are the ones leaders grew up with and know best, as did generations before them. The original org chart hails from 1854, and was introduced to help run the New York and Erie Railroad during the age of … [ Read more ]

Organizing for the Future: Nine Keys to Becoming a Future-Ready Company

Companies should embrace nine imperatives that collectively explain “who we are” as an organization, “how we operate,” and “how we grow.”

Aaron De Smet, Sarah Kleinman, Kirsten Weerda

The secret of the helix lies in disaggregating the traditional management hierarchy into two separate, parallel lines of accountability—roughly equal in power and authority, but fundamentally different.

One of the two lines helps develop people and capabilities, sets standards for how work is done, and drives functional excellence; the other focuses those people and capabilities on the priorities for the business (including overseeing their day-to-day work), … [ Read more ]

The Helix Organization

Separating people-leadership tasks from day-to-day business leadership can help organizations strike a better balance between centralization and decentralization, reduce complexity, and embrace agility.

Three Keys to Faster, Better Decisions

Decision makers fed up with slow or subpar results take heart. Three practices can help improve decision making and convince skeptical business leaders that there is life after death by committee.

Aaron De Smet

What a lot of people who need to carry out decisions want to know are two things in addition to the decision. Why? Because why gives them context. It gives them more clarity on how this connects to other things and what the full set of expectations are about what the decision is supposed to produce and why we made it and what the tradeoffs … [ Read more ]

The agile manager

Who manages in an agile organization? And what exactly do they do?

Safe Enough to Try: An Interview with Zappos CEO Tony Hsieh

Organizations are more likely to innovate and thrive when they unleash the potential of individuals and the power of self-organizing teams, says the online retailer’s CEO.

Going From Fragile to Agile

Why do companies need to be more nimble? McKinsey’s Aaron De Smet and Chris Gagnon explain what’s driving organizational agility, why it matters, and what to do.

Untangling Your Organization’s Decision Making

Any organization can improve the speed and quality of its decisions by paying more attention to what it’s deciding.