Tangled Webs and Executive Naivete

Amit S. Mukherjee

Amit S. Mukherjee is a professor of leadership and strategy at IMD’s Singapore campus. He has led technology development teams, served as an executive officer of a public company, and advised CEOs of global companies on strategy and organization design.

Leaders in a digital world have to navigate more complexity than ever before. This demand on their role requires them to avoid believing they are omniscient, to seek broader — rather than deeper — knowledge, and to be clear about their strategic intent.

Complexity in a situation increases when many interconnected factors influence each other. Digital technologies create complexity by distributing work over time and across geography. Multiple non-colocated teams, groups, and companies collaborate without necessarily knowing how, why, or how much the content of their work (such as “design of the dashboard”) or the attendant conditions (“must be delivered on …”) affects others.

For example, in the auto industry, over 40% of a typical car is designed, and over 70% manufactured, by companies whose names consumers don’t ever see. Each organization executes its own tasks, expecting the company whose name is on the car to oversee the big picture. This assumption may not hold because the relevant big-picture information simply may not exist. This happens when novel intellectual property with many unknowns is created, or when people are drowning under overflowing in-boxes, or when blind spots exist in available information because no one has acquired information that, in hindsight, was crucial. Conversely, the company whose name is on the branded product may expect its suppliers and other key partners to inform it of anything that requires attention. That assumption too, may be optimistic: Many times, partners have contractual incentives to not disclose bad news early.

This example doesn’t imply the car doesn’t get built. Were that the case, companies would abandon distributed work in a heartbeat. What it does imply is that a problem that arises in one node of such networked work can spread easily, with widespread adverse impact. It is easy to find auto industry stories of small problems that have, can, or will, spread and threaten global production. Moreover, such problems have existed since early in the digital age (and have sometimes become full-fledged crises).

Complexity-Induced Problems Often Have Similar Fundamental Causes

While each instance of a problem that arises because of complexity appears to be novel, the collection of complexity-created problems — when shorn of their idiosyncratic factors — has three primary causes:

The problems are inherent in the network. Efforts to stop problems from spreading by one path usually result in their taking other, unanticipated paths. Good leaders understand that addressing a problem’s idiosyncratic factors — including ineffective management at a node of the network — won’t protect the network. While ineffective management can exacerbate problems, crises can occur even if every leader is effective.

During the 2007-2008 fiscal crisis, for example, the U.S. Federal Reserve and the Obama administration tried to arrange the rescue of weak institutions sequentially. Each time they saved one institution, another fell. The much-criticized bailouts finally tackled two issues simultaneously: They shored up multiple institutions that would otherwise have fallen like dominoes, and they created buffers at stronger institutions that would have been weakened.

Complexity conceals what is happening, how, and why, from leaders. Digital technologies are making work more thought driven than muscle powered. Even if we set aside deliberate concealment, needed information may be buried in intellectual properties like code, models, and trade secrets, and in people’s heads. Even worse, people aren’t great at documenting their rationale for specific actions, and are terrible at documenting their rationale for not taking specific actions. That leaves leaders struggling to make sense of complex situations — particularly when the issues involved cross business unit or company boundaries, or sharp linguistic and cultural ones.

Again, the financial crisis offers an example: Because of incomplete knowledge, some of which was attributable to well-meaning pre-digital era laws, many major financial institutions had invested in both sides of failing transactions. They had unknowingly created lose-lose conditions for themselves.

Complexity challenges the human mind. Psychologists have shown that people find it difficult to simultaneously consider the collective impact of more than a handful of interconnected factors. They rely on simple — even simplistic — models of reality that may not account for all key issues. Classifying the auto industry problems as those of “supply chain management” is this kind of simplification. Supply chains are key, but product development, marketing, finance, human resources, and legal and tax issues play critically important roles, too. Classifying the fiscal crisis as one born simply of greed and deceit is another simplification. Greed and deceit abounded, but they did not bring down the world’s economy in many other situations. Simple and simplistic models make it easy to point the fingers of blame and accountability, but they discourage consideration of a situation’s overall complexity.

How to Manage Complexity: Three Ways Forward

Despite the costs of complexity, digitally enabled corporate networks won’t go away. They offer far too many benefits in today’s world. Artificial intelligence will, in time, undoubtedly help, since computers are far more effective at dealing with complexity than people are. Even then, though, the issue of how to lead people will remain. So we must consider how leaders can ameliorate the effects of complexity. Aspirants to leadership should adopt the following three recommendations, noting that each assumes (and requires) the one prior:

Develop broader, not just deeper, perspectives. Business executives with expertise in one area in which they have built their careers are often unprepared to deal with complexity. At least some of the factors that interact to produce complexity are unappreciated or not well understood. Thoughtful executives recognize this lesson every time a crisis occurs — the initial diagnoses are inevitably simplistic compared to the full accounting that emerges later — but forget its warning under the pressure of everyday work.

They should try harder. Executives should associate with people outside their fields, and participate in projects that will expose them to issues that are far from their expertise. The benefits extend beyond dealing with complexity. Steve Jobs attributed his innovativeness at Apple to his having more diverse experiences than most people and connecting the dots among them. Nobel Prize winners in the sciences are far more likely to be musicians or artists than average scientists. Career transition expert Michael Watkins has written that executives need to broaden their perspectives to succeed as general managers — he terms the necessary modifications in their leadership focus and skills “seven seismic shifts.”

Learn to think in terms of scenarios and simulations. Most human events do not follow a single line from cause to effect. Psychologist and Nobel laureate for economics Daniel Kahneman points out that humans are abysmally poor at thinking in probabilistic terms, and most cause-effect relations they perceive immediately after something happens are false artifacts of their minds.

Executives should learn to consider multiple possibilities that could explain a set of empirically observed facts. Moreover, they should make the consideration of “what ifs” routine in decision-making. In complex situations, they might then not jump at the easiest solutions.

Be clear about strategic intent. Gary Hamel and C. K. Prahalad, coauthors of Competing for the Future (Harvard Business Review Press, 1994) coined the term “strategic intent” to explain why Japanese multinationals succeeded without having strategies. Among other things, their leaders eschewed strategies (everyone implements a leader’s will) and instead provided guideposts that gave coherence to the diverse actions of their subordinates.

Complexity in a digital world demands a similar approach. Leaders who specify the intended speed and direction of motion give others the flexibility to respond to local conditions without imperiling the overall effort. Leaders themselves can then focus their own energies without becoming bottlenecks, or getting pulled in multiple directions.


MIT Sloan Management Review

IoT risk leads to executive anxiety, says Forescout report

IoT risk leading to executive anxiety, says Forescout report

A report from security firm Forescout suggests that business executives are increasingly anxious about IoT security.

Forescout’s survey, conducted on the company’s behalf by analysts at Forrester Consulting, reveals that firms are struggling to come to terms with the negative ramifications around IoT security failures.

It explores the impact that IoT and operational technologies are having on organisations and the new tide of cyber security challenges that have followed.

A majority of organisations (82 percent) find it difficult to identify and manage devices connected to their networks, and don’t have a clear idea of who should manage IoT security, either.

Complex security challenges

More than three-quarters of respondents (77 percent) from the 600 global enterprise companies included in the study say the adoption of connected devices is introducing complex security challenges.

And, as a result of this, a similar proportion (76 percent) believe that they need to rethink their IT and LoB security strategies – or risk being attacked by digitally adept criminals.

More than half (54 percent), meanwhile, say they are facing anxiety due to the rise of IoT-related security challenges, with line -of-business (LoB) managers (58 percent) showing greater amounts of concern than their colleagues based in IT teams (51 percent).

“Understanding the magnitude that a breach can have on enterprise operations and not receiving high-level assurances from IT that their devices are secure, can cause higher levels of anxiety in LoB leaders than IT,” the report suggests.

“In addition, overall distress is due to added costs and time needed to manage these devices as well as a lack of security skills.”

Read more: Small businesses doing better at IoT security than larger enterprises

Forescout finds barriers

Internal barriers and compliance complications are also leading to greater risk, the report suggests. Forty-five percent of IT bosses and 43 percent of their LoB counterparts report that they’re struggling with budget constraints.

One in four security professionals, meanwhile, continue to rely on traditional security methods, and these don’t always work.

This is not entirely surprising, given that organizations are so frequently unable to identify all their connected devices. In fact, more than four out of five (82 percent) of respondents say they struggle here. Fifty-nine percent are happy to comply with medium- to high-risk regulations related to IoT security.

The good news, perhaps, is that nine out of ten (90 percent) plan to increase IoT investment in the distant future – but to do so successfully, they clearly need to tackle their security anxieties head-on. 

Read more: Gemalto survey: Governments should intervene on IoT security

“Dynamic shift”

Michael DeCesare, president and CEO at ForeScout, said: “The survey results demonstrate a dynamic shift in the way organizations are starting to think about security and risk as it relates to IoT.”

“Each new device that comes online represents another attack vector for enterprises and it only takes one device to compromise an entire network and disrupt business operations, which can impact the bottom line,” he added. 

“Securing IoT is not just a cybersecurity issue, it is a business issue and operating at any risk level is too much. Enterprises need full visibility.”

Read more: Frost & Sullivan: AI and big data hold keys to IoT security

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Internet of Business

Meet Noon: A stealth lighting startup by a former Nest executive

The FCC label shot for the Noon dimmer.

Is the world ready for a new smart lighting company? That’s the bet Erik Charlton, a founding member of the Nest team and its former head of business, is making with his latest startup. Locoroll is a Cupertino-based company making a smart dimmer switch according to filings with the Federal Communications Commission. Based on both the FCC filings and a trademark filing, Locoroll plans to sell the switch under the Noon brand name.

Lux Capital and Sway Ventures have backed Locoroll, which also has an impressive roster of smart home product executives. Greg Smeltzer, its head of product comes from Lyve, a company that made photo organizing software for phones and TVs. The head of marketing is Kathy Sanders who was the former CMO at August. Other members of the team come from GoPro and Fitbit.

I’ve been tracking this startup for the last few months after hearing about it from a retailer. The launch timing is uncertain, but is likely close given that the FCC filing has appeared. However, the product has been a while in the making. Locoroll was formed in Jan. 2016 according to Charlton’s LinkedIn profile.

The original product appears to be a smart dimmer switch, but the company calls itself a smart lighting system. The switch will have both Bluetooth and Wi-Fi support according to the FCC filing. Smart lighting makes sense as a category if only because there are few super compelling options out there. Lutron is my personal favorite but it requires a hub to connect with popular services thanks to its proprietary radio technology.

Other switches offer basic lighting functions plus the ability to control the switch through an app or a voice-based interface like Amazon’s Alexa. And there are dozens of interesting startups that offer capacitive touch buttons that are programmable or artificial intelligence built in that will learn your habits. If I were making a bet, that’s where I would hope Noon goes.

Because light switches have continuous access to power and a relatively large space to put computing, they are a logical place to put Bluetooth-based presence detection in a room: algorithms that anticipate what a person might want at a set time and even repeaters for wireless services. If Noon offers anything like that it would be compelling.

Although it would have to be done well. There are few things more irritating than a “smart” light that incorrectly anticipates your wants. Currently, startups ranging from Nuro Technologies to Brilliant are trying to innovate in lighting. Other companies include KetraStack Lighting, and Plum.

The challenge, however, is that light switches require an install that intimidates most people. If Noon can make installation easier, offer a unique blend of services that feel automatic and make it look stylish it could win in a category that is still trying to figure out what it should look like in a smart home.

Stacey on IoT | Internet of Things news and analysis

Executive interview: Leadership in digital transformation

According to Bosch Software Innovations’ CEO Rainer Kallenbach, role models of traditional hierarchies still exist – even in the digitalized world of work. In an interview with haufe.de’s Ruth Lemmer, he explains how leadership works at Bosch Software Innovations in times of digital transformation  

Bosch Software Innovations employs more than 800 IoT experts in Germany, Bulgaria, Singapore, China, Japan and the United States. Are you and your team the elite members of the Bosch Group’s worldwide workforce of 390,000 people?

I wouldn’t put it that way. As a subsidiary firmly rooted in the Bosch Group, we naturally partner with Bosch divisions to set up IoT technology and build up IoT expertise. Equally important is the development of IoT solutions for customers such as Osram, Zumtobel, Renault, and Stromnetz Berlin, which is responsible for Berlin’s electricity distribution grid. With our software, we have already connected more than five million sensors, devices, and machines with their users and enterprise systems.

 

You’re already working in the future, it seems. What types of projects do you and your associates tackle?

The IoT builds bridges between things and their users. Private individuals benefit from connected homes. Manufacturers rely on connected welding robots. And in agriculture, sensors help farmers cultivate their asparagus fields. Data generated via connectivity and cloud technologies are already allowing companies to develop entirely new business models. Physical things can now be supplemented by digital services. A gas boiler will benefit from automated heat management, for instance. And thanks to connected charge points, drivers of electric vehicles can quickly locate a vacant point using an app.

 

What types of skills do people need to work at a software company?

As a software company, we look for people who excel at software development above all. But a lot of our associates also work directly on customer projects as IoT consultants, project managers, UX designers, innovators of business models, or trainers. Subject-specific qualifications are very important, to be sure. But a person’s soft skills are playing an increasingly large role . In my eyes, people with good soft skills are open-minded, courageous, and creative. They’re also eager to experiment and willing to tackle new things. Such people are generally not traditional job applicants. Instead, working in a promising field that is sometimes altogether unconventional makes them motivated and happy.

 

There is a catchy slogan on your website: “No one can do I(o)T alone.” But how do you persuade business partners and staff to tear down the walls around their gardens of knowledge?

Ideally, people realize for themselves that their own little garden is pretty, but also inflexible. The more perspectives you can combine, the more successful your project will be. You can design a trendy software on your own – but if it misses the mark or is incomprehensible, that will only frustrate users. I also want to mention that we hire open-minded people who, in addition to providing expert input, also enjoy communicating. After all, our teams work at nine locations worldwide. We therefore rely heavily on digital means of communication such as online chats, social intranet, and video telephony.

 

In a survey you conducted, 27 percent of respondents at business partners and Bosch companies stated that a lack of qualified people constitutes a high hurdle for Industry 4.0. Engineers and computer scientists must find a common language. Is there a solution to this problem?

Yes, there is. Applications for connected manufacturing demand a completely new type of job description. There is a need for specialists who have expertise not only in IT but also processes and industrial production. We need to get all these experts on the same team to carry out these projects full of promise. If you grasp that interdisciplinary teamwork is essential to success, then you will change voluntarily – nobody will need to force you to do so.

 

Your roots are in the traditionally hierarchical world of Bosch. But you sound like an agile start-up founder.

Approaches in the workplace and leadership culture cannot stay the same if you want to drive forward projects that make use of temperature sensors in strawberry fields or leverage connectivity to help drivers find parking spaces. If you study the DNA of IoT, you will find self-organizing systems, small teams, and quicker decision-making. This is one great thing about working at Bosch, where your career can provide you with insights into large enterprises and small, agile units alike.

 

Which factors can promote change?

We must trust our teams and learn from mistakes. In addition, we have to demonstrate courage and grant teams the power to make project-related decisions . Open and transparent communication is essential to responsible collaboration that spans the globe. Last but not least, executives must personify the will to change . They also need to eliminate obstacles and intervene only when necessary.

 

That sounds good. But HR managers have surely heard these requirements before.

Be that as it may, we must make change happen soon. People have always been the key to success, of course, but that goes double for the connected world.

 

Interested in more insights on connectivity? In this thought leader piece, IoT industry execs share their personal perspectives on the human factor in digital transformation.

Download digital transformation white paper

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Bosch ConnectedWorld Blog

The Question Every Executive Should Ask

Every CEO has many stakeholder groups whose interests he or she must balance: customers, employees, the board, shareholders, regulators, partners, nongovernmental organizations, and communities the business may impact. But even by CEO standards, Bernard J. Tyson’s stakeholder management responsibilities are extensive. The chairman and CEO of managed care giant Kaiser Permanente Health Care must attend to the interests of nearly 12 million people who count on his company to keep them alive and healthy; thousands of physicians, nurses, medical technicians, administrators, and managers; unions; government agencies; industry watchdogs; pharmaceutical suppliers; emergency-service providers; and, oh yes, the president and Congress of the United States.

Such is the challenge of leading one of America’s largest health care organizations in the year 2017. The remarkably upbeat and optimistic Tyson met with MIT SMR editor in chief Paul Michelman to discuss Tyson’s role as a leader at this unique time and place in history.

An in-person conversation at Kaiser Permanente’s headquarters in Oakland, California, was followed by an exchange over email. What follows is an edited and condensed version of the conversation.

MIT Sloan Management Review: As the CEO of a large health care provider, you are facing a potentially dizzying array of systemic challenges — even before you get to the day-to-day needs of the organization. You’re dealing in life or death. You’re dealing with a broad range of different stakeholders, some of which are notoriously challenging to manage. And you’re leading an organization in an industry impacted by a highly unpredictable set of economic, policy, and technology factors.
I can imagine it’s easy to get lost in these many issues. How do you stay grounded and focused on the needs of the organization?

TYSON: (Laughing) If I took what you said literally, I wouldn’t show up for work.

One of the best of the many pieces of advice I’ve gotten over the years is, “Keep the main thing the main thing.”

So, what’s the main thing for us? We are here to provide care when people need it and to help them maintain their health. Everything we do is through the lens of that mission. The rest is subplot. Yes, there’s going to be a lot of turbulence. The broader conditions change continuously. We don’t control that. But one thing we do control is staying focused on the main thing.

What does that look like in the organization? It’s easy to assume that through every layer of management that gets closer to day-to-day process, it becomes harder and harder not to get lost in the details. So, what do you do to reinforce the focus on mission throughout the organization?

TYSON: Well, actually, I would reverse that. I know, from walking through our medical centers a lot and from experiencing a near-death experience myself a decade ago, it is at the front lines where people really understand our mission, because they live it every day. I don’t need to remind a nurse or doctor that we are here to improve health and save lives.

The challenge is everything after that. Does our work throughout the organization support the interactions that happen at these delicate moments in people’s lives? That starts with recruitment. Wherever in the organization we are hiring, we need to ask if the employee’s personal mission in life aligns with the mission of the organization. My job is to maintain an environment conducive to attracting people who fit our culture. Making sure we are all clear on the mission is core to that.

One of the benefits of our model is that physicians are managed in separate organizations called the Permanente Medical Groups. These are self-governing groups that contract exclusively with Kaiser Foundation Health Plan Inc. This is unique to our model, and it’s a tremendous asset. Physicians operate within their own organizations and manage and oversee all aspects of patient care. There is no health plan interference in medical decisions.

Given the challenging context in which you lead, when are your values tested the most?

TYSON: They are tested when external forces raise questions that the organization needs to address. We dealt with an example of that in January with the [U.S.] president’s executive order about immigration [restricting entrants to the U.S. from seven Muslim-majority countries]. It raised a lot of angst in our organization, just like it did in society at large. It prompted me to send a message across the organization making sure everyone was clear that we will continue to stand for equal access and care for everyone, and that no one will feel that they’re being scrutinized if they need care from Kaiser Permanente.

Now I know, even without my message, we wouldn’t have had a single problem with someone being questioned for care, or denied care, or anything like that. But it was an opportunity to reaffirm what we stand for, to reinforce what people throughout the organization already know about our values, and to remind them that they are a part of it. And there is real satisfaction that comes from the thousands of responses to the message, saying, “Thank you for just saying that.”

Do you think that the necessary skill set for leaders is changing?

TYSON: Absolutely. There are so many forces coming at the same time. It used to be you could portion things off and deal with them one issue at a time. Now the challenges are multidimensional. Leaders are required to distill the complexities of all the forces, some of which are beyond their control, and then to guide the organization in making sense out of them and delivering on the value proposition, which requires executing on strategies within all this complexity.

An example is our continued work to increase access to care and services and improve quality of care while also making health care more affordable. That is the promise we have made to our members and customers. Every day we are working through extraordinary complexities to deliver on this goal.

The days of a hierarchical leader being the know-all, the understand-all, and the be-all individual makes no sense in today’s environment. You have an organization made up of people with skills, talent, and intelligence. The challenge is no longer how to instruct people in what to do. It is to set the direction and performance expectations, and then to inspire and motivate people.

I would argue that, in simplistic terms, the old model was [that] those in management were the thinkers, and the rest of the workers were the doers. Now we live in a day and age where everybody gets to think and do. I want the frontline nurse, who has access to the same information I do, to act on the information pertaining to his or her profession and, with that access and freedom, come up with new ideas and new ways of getting work done.

For example, our Nurse Knowledge Exchange reinvented the way nurses share essential patient information during shift changes. This new process was developed on the front lines. Nurses moved their meetings from the nurses’ station to patients’ rooms and made patients part of the process. The “ghost town” atmosphere during shift changes that patients sometimes mentioned was essentially eliminated.

In the past, power was centralized in the hands of the few people who had access to information and who used that access to direct the narrative for the company. So we were benefiting from the intellect of just a handful of people. Now that information is available everywhere, the leader’s critical question is, “How do I charge up the organization so that we’re maximizing the intellect of all of our people?”

When you take that approach to its extreme, you potentially have anarchy. How do you guard against that?

TYSON: I reject that term. I think of it as very organized chaos, if anything. In a complex organization like Kaiser Permanente, you manage the organized chaos with clarity about the mission, the value proposition, and the end game — the main thing. All the incentives and resources need to be aligned to that.

As I’m talking to you right now, a medical team is likely attending to someone with a near-death experience in one of our emergency departments. My job is not to call to see what they’re going to do next. It’s to make sure they have the tools, the equipment, the know-how, and the decision power to make the right judgment when called upon, in the interest of the person whom they are serving. We are perfectly organized for this to happen.

In an organization like Kaiser Permanente, where knowledge, technology, and skills are in the hands of thousands of capable individuals who are making millions of microdecisions, a CEO would be foolish to think he or she controls those decisions.

Let’s talk about the middle of the organization, where people are not dealing directly with patients. Is it more challenging for middle managers to adhere to the same mission-driven standards?

TYSON: Yes, I think middle managers are in one of the most difficult positions. They are right in the line of the visionary statements that come from people like me, who ask them to create the right environment to do all the stuff we believe in. And then this same person gets a budget, and a set of objectives, and they’re getting pressure from both ends. They’re feeling the push of the frontline caregiver saying, “I need more resources to do the things I need to do for our members.” And the people above them are saying, “Are you within your budget? Have you justified what you need?”

Managers in the middle of the organization are dealing with both dynamics simultaneously. I’ve been there. I know what it’s like to try to sort through the demands of both worlds. It’s not always clear but, guided by our mission, we’ll always do the right thing. We make sure we have the right resources to deliver on our mission.

Then there’s the fact that many managers got to where they are because they did the technical stuff right. People who had strong skills and leveraged those skills well were rewarded with more responsibility.

When the primary job of a manager was to make sure the workforce had what it needed and did what it needed, these technical skills usually transferred pretty well. Now management is evolving away from directing and toward coaching, facilitating, and creating the right environment for people to excel in their space. Middle managers are again caught between two forces. We are asking them to move away from exercising hierarchical authority and still expecting them to deliver results. We have great managers at Kaiser Permanente doing this every day.

In some cases, middle managers need to unlearn old things to learn new things, and part of our evolution is addressing how we continue to reeducate our people. We have more work to do with our middle managers, who are critical to the success of any organization but especially at an organization like Kaiser Permanente, where we work in a partnership model with our unions, employees, and Permanente physician groups, all collaborating together.

Given those observations, has Kaiser Permanente thought about changing the criteria for identifying managers in the organization?

TYSON: Not necessarily, but it has prompted us to rethink our whole training and education program and how we support managers to be successful.

We also look for skill sets that match the management requirements of the 21st century when hiring. We are looking for ways to find and develop talent — both inside and outside of our organization — that align with what we’re trying to accomplish.

As an example, genKP is a millennial employee group I sponsor. Almost 20% of our employees now are millennials. This group meets on a regular basis with me and presents to my senior leadership team. Last year, I made a special effort to meet with millennial employees during my visits to each of our regions. Across the country, these employees shared why they want to work at Kaiser Permanente — and also what makes it challenging.

From those discussions, they created something called Stretch@KP, which offers millennial employees opportunities to take on projects outside their core areas of responsibility. They learn new skills and expand their relationships in areas that interest them, while bringing fresh perspective into other areas of the organization.

It’s a two-way street. We’re learning how millennials think, how they behave, what they expect in the work environment, just as they’re learning from us.

We had this wonderful interaction in a recent meeting. They were being very clear about what’s important to them: “I don’t want to be stuck in one job. I’m looking for meaning. I’m looking for purpose. I’m looking for a life.” We listened, and one of my senior executives said, “While you are taking care of all that, let me offer some advice about how to get stuff done in the organization.” It’s a give-and-take relationship.

We’re focused on working with our millennials as the future leadership of the organization. We’re building the pipeline.

In our conversation, you’ve emphasized a focus on mission and on understanding what’s important to both individuals and the organization. How does the Kaiser Permanente culture work in support of those cornerstones?

TYSON: One of the cultural elements I’m focused on is the freedom to speak.

First, I believe strongly that we live in a great country and that freedom of speech is, in part, what makes it great. We’re seeing it acted out every day right now in our country, and it’s a beautiful thing. The last thing I want is for individuals who exercise freedom of speech throughout the rest of their lives to feel any different about the freedom to speak inside the organization.

We are working on creating an environment where everybody feels they have the right and the obligation to speak their truth: “This is what I witnessed. This is how I’m feeling. This is what I can offer toward the solution.” I want the best thinking brought forward. I want all the different views to be on the table. I want debate and people discussing options. When people believe they will be respected for their views, they are more willing to contribute.

In senior management meetings, when one of my executives feels strongly about an issue and they want to take me on, sometimes they’ll ask, “Freedom of speech?” And I’ll say, “Yes.” And they’ll repeat, “Freedom of speech?” And I’ll say, “Absolutely.” And then they’ll come with it: “I think you’re dead wrong.” They don’t have to sugarcoat it. They just simply put the code out there: “Freedom of speech?”

Now our management needs to continue to get comfortable that freedom of speech exists everywhere in the organization. Everyone has the freedom and the right to share their views and even disagree with others.

I’m struck by the language you use. It’s not unusual to hear organizational leaders talk about the need for frank conversation, but “freedom of speech” is not a term that you often hear in business. I’m interested to know if you’re actively using that phrase throughout the whole organization.

TYSON: Yes, we are using that phrase. I think the organization, just like this country, is not owned by any individual. We’re all stakeholders. You’re spending eight to 10 to 12 hours of your living day in this environment. And I believe you have the freedoms in this organization that you have in general society.

Freedom of speech does have consequences at times. You take a hard position on something, which you have the right to do. Well, there may be some people who feel just as passionately that that’s not the right position. You need to be prepared for that. But this freedom is intended to bring out the best in individuals. And when it’s working, it feels nonjudgmental.

It’s not about promoting arguments. It’s about creating a culture where a nurse can walk in and say, “I’ve been thinking about something. What if we did this process 1, 2, 4, 3 instead of 1, 2, 3, 4?” And the natural response from whomever she is addressing is, “Oh yeah? Let’s flesh that out and see where we want to go.” Maybe it’ll get adopted and maybe it won’t, but it will be considered. No one should think twice about sharing their opinion, because they know freedom of speech is embedded in our culture.

It’s the role of management to take all the various perspectives and ideas into consideration before making a final decision and ensure everyone knows they have been heard in that process. And none of this works without people speaking up.

Let’s shift gears and look outside the organization at the broader context of health care. The morning after the U.S. presidential election of 2016, you shared a message on LinkedIn in which you affirmed your organization’s commitment “to advocating for a U.S. health care system that is affordable and sustainable and that delivers high-quality care for all Americans.”
What does the agenda for keeping to that commitment look like as we sit here today?

TYSON: For me, it begins with this question: How do I make sure that I demonstrate the same commitment to the current [U.S.] administration that I did to the previous administration and the one before that? I do that by committing to our policy position, which has not changed one bit. Before there was the Affordable Care Act [ACA], for as long as I’ve been in this organization, which is over 30 years, and well before I joined this organization, Kaiser Permanente has advocated for the same position: Coverage and insurance should be made available to everyone, and everyone should have equal access to the front door of the American health care system.

And what I mean by the front door of the American health care system is that everyone should have the choice to seek care early before problems develop, rather than waiting until they are so sick and desperate for help that they have to go to an emergency department, which is the most expensive place to receive care.

The ACA may not be perfect, but it helped millions of people get access to coverage and care. We saw many examples firsthand where members were able to sign up and receive lifesaving care within weeks or months of being enrolled.

My objective is for us not to lose ground on the progress we’ve made over the last seven or eight years. Kaiser Permanente will work with the new administration and our government toward this goal.

As we think about the future of health care, technology is playing a huge role in the delivery of care on many different levels. But which is more likely: that technology will democratize access to quality care or that the benefits will flow disproportionately toward those who are already advantaged and who need the help the least?

TYSON: That’s a great question. I think it depends on what kind of collective environment we’re going to create. The beauty of technology is that it gives us an opportunity to democratize access to care in very different ways from past models. Technology already allows us to provide most of our primary-care encounters virtually. We have mobile vans that we take out into the community. They include a lab, mammography services, and an exam room. We provide care on-site, not just for Kaiser Permanente members but for anyone in the community, and beam the information up to one of our main facilities.

Consider the possibilities for what the further evolution of technology means for access. In rural areas, for example, where you don’t have a standing medical infrastructure, you have the capability of piping in care. Think about this technology being applied in both our own country and across the rural Third World, where the infrastructure often doesn’t exist at all. Through that lens, technology has a great promise to democratize health care.

On the other hand, you can see the opposite. You can see the economics where the new technology becomes more of an added benefit, an added privilege that is priced accordingly.

Technology cannot be taken in isolation. We need policy makers, tech leaders, influencers, and others to come together to think through the ethical and moral issues technology poses. There are still fundamental issues that need to be addressed in order for the health care industry to tap the power and potential of technology to deliver better health to everyone, regardless of race, economics, or geography. That includes reducing barriers to tele-health services, encouraging interoperability, and addressing cybersecurity threats in a balanced fashion.

The question of equity applies broadly in health care, beyond just technology and innovation.

How do we get people to see the big picture when thinking about health and questions of affordability and access to care? I would argue that a big-picture perspective to health is what has been missing from our current health care system, which was designed around the “fix me” model, where people came to a doctor’s office or a hospital only when they were sick.

Kaiser Permanente has always focused on prevention, and now we are thinking about how we can influence health and behaviors even earlier — and not just the health of our 11.7 million members but the 65 million people in the communities where we operate. We know that medical care is only a small, but critically important, percentage of what determines good health, so we are looking deep into our communities to develop partnerships with schools, local governments, and businesses to influence the things that create health in the first place — such as jobs, education, public safety, environmental health, etc. I think this is the evolution of health care. It’s exciting.


MIT Sloan Management Review