Chapter 1 - Understanding Clever People
While many clever people are highly intelligent and have great academic credentials, not all people who meet those qualifications are clever. Some such people are exceptionally good at following the beaten path. Other people show a great deal of cleverness in spite of failing to achieve traditional distinctions.
The authors' definition is that "Clever people are highly talented individuals with the potential to create disproportionate amounts of value from the resources that the organization makes available to them."
The second bit is significant - as there are many talented individuals who are capable of producing results on their own, and who do not need organizations to do so. Maverick geniuses have achieved great things in the solitude of their studios and workshops, and their work is admirable - but because they work in isolation they are of little interest to organizational managers.
This book is concerned with the clever people who need the resources of an organization to achieve their full potential.
Profile: Will Wright
The author mentions Will Wright, who is "the man behind the original SimCity," which spawned an entire series of simulation games. The original SimCity was a god-game that enabled players to plan a city, and the Sims series gave them more granular control of individuals in a neighborhood. The concept of a game with no clear goal, merely a simulation with which players could interact, was a novel concept and a sweeping success. The author mentions "Spore," another game that offered players the ability to influence the evolution of creatures.
Of note, SimCity was a sort of accidental offshoot of the tools Wright developed to build city environments for other games - in which the city was more the setting than the object of play, but the developers wanted realism. He enjoyed building cities with the tool he created and figured others will as well.
When he decided to pursue Spore, Wright picked his team carefully. "The very best programmers are worth ten really good programmers," he's said. They are the ones who can see the elegant and simple solutions to problems that others will attach with reams of conventional code. They just seem to have a way of seeing an unconventional but effective way to get to the heart of a problem.
Wright is an example of a clever person who created enormous value for his company (nearly $3 billion in 2004 alone) by discovering and pursuing an idea that wasn't in the company's game plan. Admittedly, the video game industry is much more flexible and open to new ideas than many industries, but also tends to be an environment of heads-down grinding on a single plan and resists the filigree of on-the-fly ideas in attempting to make a ship date for a new game.
Wright seems uncomfortable at being called a leader, but says "I tend to see myself as one of the soft leaders" in which he is not directing the day-to-day affairs of his people, but providing guidance and keeping track of progress, but not really driving in the traditional way.
It's also suggested that the presence of a clever person also attracts other clever people, who want to work with someone who "gets" them and will support them appropriately and let them do what they do best. The key to managing clever people is to give them latitude rather than yoking them into mindless hands-on drudgery, even though they may seem to be efficient at dealing with it.
It's also mentioned that firms must have the patience to continue to support clever people even if their ideas do not pan out - the next one may be brilliant. Ironically, the author suggests that it is "unlikely but not impossible" that Wright's "spore project will be a flop (EN: which is exactly what happened) but he expects his company will continue to support and feed the efforts of Wright and his team of clever people even if it is.
Symbiotic Men and Women
The organization is a source of resources and protection to people with creative minds - they have the brains to do things, and they're well aware of it. They are also well aware that they cannot accomplish what they need without the support and security of an organization.
No single individual has the resources to construct an airplane, build a robust computer operating system, or film an Oscar-winning movie without the support and assistance of other people - and few individuals have the financial resources to personally create a company that is capable of doing so. In that sense, the corporation is the patron to inventors and innovators.
(EN: This may bear some reflection, because many of the innovations of the industrial era were done in a private workshop and many software companies were founded in garages. My sense is that in the very early stages of evolution, innovation can be done privately on small scale - but some efforts are large-scale to begin with, and others evolve that way after everything that can be done on a small scale has been done.)
Even when the inventor can create a model or prototype, he needs a company to develop, manufacture, and distribute his idea to those who have need of its benefits or can make use of it.
(EN: This is also a good point, and well remembered in instances where the person or firm who came up with an idea was not the one to bring it to market. This also happens with companies. For example, Xerox PARC developed the idea of the graphical user interface but was reluctant to pursue the idea commercially, so Apple stepped in and made a go of it.)
The challenge for leaders in organization is to create a magnet to draw such people to them, preferably before your competition does . Once you have them, can you provide the kind of support that is needed to retain them.
Perhaps most importantly, can your organization's culture tolerate them, given the peculiarities of clever people. The best and most talented person may well be "a complete pain in the ass" and you organization may have to accommodate infantile behavior.
(EN: Accommodation likely is not the right solution in all cases - the main issue with many firms is that they hire a number of clever people and it is plainly impossible to accommodate them all. And if there is a battle of prima donna employees, how do you sort it out without alienating many for the sake of the few? Perhaps the authors will consider this later, but here it seems neglected.)
The Rise of the Clever Economy
In the nineteenth and twentieth centuries, the struggle for power among people, companies, and even nations was over control over productive assets - land, timber, minerals, and such. In the present day, the struggle for power has shifted to control over innovative people, because without the ideas the assets are not productive.
(EN: I would argue that this began much sooner, and that what gave America a huge leap forward in the mid-twentieth century is its ability to draw the clever people out of other nations. Many German and Russian scientist fled to America to avoid hostile regimes, and even today clever people from overseas come to the US to profit from their abilities in a free economy. This considered, America likely always has been fueled by the clever and hardworking people of other nations.)
Even in the throes of an economic recession, various firms are declaring that they have "half the talent we need" to capitalize on opportunities. That is to say that they are hungry for talent, not just "people." Untalented people are overabundant, and talented ones are rare.
(EN: Entirely separate argument about companies abdicating the responsibility of developing talent, and all are seeking to hire it off of someone else, and then they are scared to develop people because they will be hired off by other firms. Vicious circle in which everyone suffers, and few have devoted the resources to invest in developing their people and then paying enough to keep them.)
Back to the need for people: intellectuals drive productivity, value creation, and growth. The ability to produce goods efficiently was once important to competition and the most efficient firm could undercut prices to seize the market. Nowadays, efficient manufacturing is a common strength to many firms - and competition isn't to be the cheapest but the best or most innovative. That requires clever people.
The authors provide a few examples of firms that have experienced dramatic growth due to "economies of knowledge" and demonstrate how firms that are innovative profit more and withstand financial downturns better than those who merely try to be efficient in their operations.
It's also mentioned that it's not simply a matter of mathematics. The firm with the highest number of creative people does not win, and very often there are "diseconomies of scale" because clever people conflict with one another and this stifles rather than fosters creativity. One bright idea can make billions of dollars, but ten bright ideas compete and conflict, and often the best idea is ignored for the sake of one that seems better because of the way it is presented. One bright person may have better ideas than a committee of ten bright people, as groupthink and politics set in and stifle innovation.
All of this makes it difficult to calculate the right amount of investment in research and innovation - the relationship isn't linear. If you invest nothing, you are certain to get nothing. If you invest $200 million, you will get something. If you increase that to $400 million you will not get double, and might get half. OR if you cut it to $100 million, you might not lose half and might find that you gain. It's entirely confounding from an accounting perspective.
Fast Times
Consider the pace of progress throughout history: dramatic changes in the way people lived and worked occurred periodically, with major breakthroughs and revolutionary changes happening every few centuries or so. Today, change occurs much more rapidly and the "thirst" for new ideas is constant.
Clever people are famous fast, as their impact and their reputation spreads more quickly than ever before. Where innovators were once persecuted by society (particularly the religious institutions) they are now lauded, at least for a time. Innovators have not take over "celebrity culture" entirely (we celebrate trashy and lowbrow people, now more than ever) but they are at least recognized.
Ideas travel the world with unparalleled speed and ease. Electronic copies can be made faster than paper copies, can be transmitted around the globe in seconds, and cannot be as easily intercepted or controlled. Essays, books, and entire libraries are open an accessible.
There is also the thirst for clever people, who are the wellspring of good ideas. The old world rewarded obedience and expected life-long attachment, but the present age rewards innovation and expects employees will change jobs readily should a better opportunity present itself.
Mobility
Another change the author notes is the mobility of the knowledge-worker. It is not uncommon to meet someone who was born in Bangladesh, educated in Canada, who has lived and worked in New York, Tokyo, London, and Sydney. A generation ago this was virtually unheard of: careers for clever people are not a "predictable and long climb through a single corporate hierarchy."
Companies struggle to retain good people. The various tricks of the trade (noncompetition clauses, rewards thet vest over time, elaborate tax plans, etc.) are failing, and labor is not even susceptible to the highest bidder: what people want is a great place in which the express their cleverness and work with other clever people.
Clever people are smart enough to know their worth and they expect to be rewarded accordingly - that is taken as a "given." But more than that, clever people want a sense of fulfillment and achievement from the work that they do and the firms for which they do it.
The Downside to Clever
While the authors have been going on about the positive impact that clever people can have, they concede that there is also enormous destructive potential. People with innovative ideas expect companies to implement them, as quickly and as broadly as possible, and to implement them exactly as they are. They complain about how much time it takes to turn a ship, not realizing that it cannot be turned any faster without capsizing.
Clever people can also be too clever for their own good, in love with ideas and blinded to the downside. Clever people can significantly damage brands and destroy huge amounts of shareholder value when they get it wrong. That's bad for companies and shareholders, and the careers of leaders who supported them.
Consider the financial crisis caused by clever bankers, or the scandals created by clever accountants, and the like. In arrears it is easy to see what was done wrong, but before catastrophe struck their ideas seemed very innovative and highly profitable. Enron was very clever ... until it wasn't.
Characteristics of Clever People
The next chapter will take a more detailed look at how to lead clever people effectively, but for now the authors mean to discuss some of their key characteristics.
- The motivation and reward for clever people is seeing their work concretized - having good ideas on paper, left to collect dust, is very de-motivational.
- Clever people are also encouraged by having their ideas heard. If they are silenced or summarily reject, you will kill not only that idea but their willingness to contribute in future. (EN: It might later be said, but a clever person can deal with rejection if they understand the reasons, or better still if they are allowed to discover the reasons, rather than simply being summarily dismissed.)
- Clever people take "genuine pleasure" when they break the rules and succeed. They do not like being yoked to tradition and convention, particularly when it is obstructive.
- Clever people also trivialize the importance of non-clever people. They do not like nor do they have much respect for people who are mundane and institutionalized.
- Clever people are sensitive and possessive about the projects they work on. They will cling to an idea that they know is not leading anywhere in hope that it might.
- Clever people cling to the "knowledge is power" syndrome and seldom share their knowledge or contribute to knowledge-management systems, feeling they are giving away what is most precious without being adequately rewarded or recognized. (EN: This is the main reason most KM systems fail miserably.)
- Clever people are never happy about a review/evaluation process, particularly when those who review and approve their work are mundane people who seek to squelch innovation in the name of tradition or standard practices.
- Clever people abhor micromanagement. They are most effective when given a problem to solve and left alone to solve it, and regard attempts to "collaborate" as controlling and intrusive.
- Cleverness is central to the identity of a clever person - innovation is not a task to be performed but a quality of their character.
- "They are their work," which you can witness when asked to introduce themselves. Their profession comes right after their name, and they seldom mention their employer (because pride is in doing, not belonging).
- Clever people wish to follow their passion. They will reluctantly attend to the mundane and administrative duties, but would prefer to spend their time being clever and solving problems.
- Clever people may become obsessive, ignoring the ROI comparisons among options and focusing on that which provides the greatest intellectual challenge to solve.
- Clever people read omnivorously. They are generally not casually perusing out of boredom but gathering information they believe to be pertinent to solving a problem. There are long quite periods among bursts of activity.
- Clever people are perfectionists who cannot bear to leave any stone unturned. They are prone to losing sight of the bigger picture as they delve into the fine details.
- Clever people are highly independent - they may not see or wish to admit their dependence on others, and a leader must know when to leverage this and when to mitigate it.
- Clever people will show a fondness for a solution that is elegant, intricate, or unusual - even when there is a straightforward and unglamorous solution.
- Clever people lose their work-life balance. To them "work is life" and when they are fixated on a problem, nothing else matters.
- Clever people are competitive with one another. There is nerd pride in being the "most clever," and while they appreciate the cleverness of others they are always sizing one another up.
- Clever people consider themselves to be unique and indispensable. They believe their skills and creative abilities are not easily replaced, and they are often quite right about this.
- Clever people practice and sharpen their skills. Any activity that does not make them better is regarded as making them worse, or at least making them rusty at what they do best.
- Clever people know their worth, and believe that it is not adequately valued. However, "value" is not in terms of compensation (alone) but also pertains to the resources afforded to them. There's an anecdote about a brilliant biochemist who took a job that paid 25% less from an employer who offered him a well-equipped lab, adequate assistants, and greater latitude.
- Having a sense of being valued makes creative people more aggressive in promoting their ideas. If threatened or told they are easily replaced, they may shut down and comply - while looking for another job.
- Clever people have an ambivalent relationship with managers. They wish to be supported rather than controlled, and conflict with micromanagers greatly. For the same reason, many clever people make very poor managers of other clever people - they cannot step back from the work and let others be clever.
- Clever people can be blunt and candid. They feel they know "the truth" and discussion of anything else is merely waste of time, as the other person will eventually recognize that they are right. There is no greater feud than occurs between two clever people who are convinced of mutually-exclusive conclusions.
- At the same time, clever people see argument as constructive. They are passionate enough about their ideas to be convinced they are right and tenacious in pursuit of the conclusion, and they hold others to the same standard even when in disagreement.
- Clever people challenge everything. What is old or traditional is automatically assumed to be wrong and they will fall in line with an opposing position as quickly and readily as a mundane person will seek to comply.
- Clever people are not bystanders or observers. Even when they are not speaking, they are observing. They are watching to figure out how the game works, with a mind to leverage that knowledge to step in and win.
- Clever people may be socially awkward, but they are organizationally savvy, being able to understand the roles and functions of people and groups as a system. While they remain focused on their work and avoid "political games" they are not naive to the workings, and can be at times expert gamers.
- Clever people are not impressed by rank and title in the corporate hierarchy, and very often have contempt for those who are elevated in an organization for playing politics. They are more concerned about what other clever people think of them than what management does. That is not to say that clever people do not matriculate into management positions, merely that it is unusual for them to do so.
- Clever people will make the necessary compromises to be obedient, but do not "follow" a leader, and the more a manager wishes to have their obedience the less they will be inclined to give it.
- Clever people care about status and recognition, but not in the traditional way of money and job title. Their reference points may be outside the organization, in the professional community.
- Clever people have a sense their work is important and urgent, and resent that it does not get as much support or recognition as it merits. If the CEO is not informed, they assume their work is not taken seriously.
- Clever people expect to be recognized and rewarded without having to promote themselves. They sense that if leaders are good leaders, they will be aware and attentive. The same is said of employers outside the company.
- Clever people want to be connected to other clever people to share knowledge and discuss ideas. The company of other clever people is one of the chief benefits of being within an organization. They wish to be part of a network of knowledge, but in a collaborative rather than competitive manner.
- Clever people tend to be ungrateful. When they are recognized or rewarded they feel that they have earned it, and should have been rewarded more generously and sooner than they were.
- Clever people don't recognize good leaders. They are frustrated and annoyed by the bad ones but often fail to recognize when they are being supported and facilitated in a manner that avoids frustration. The highest compliment they offer a leader is that "you're not getting in the way too much."