When does a star performer become a corporate nightmare? And what can you do about it? HBS Working Knowledge's Mallory Stark conducted this e-mail interview with Morten Hansen.
Stark: Can you describe what you mean by "lone star?"
Hansen: A lone star is someone who performs really well in his or her job but does not help others. Or one asks for help and is sometimes even abrasive when asked to do something for the company that does not benefit him or her directly. The problem with these people is that they can poison the organization—they set a bad example for others if executives keep rewarding and promoting them. Managers may feel that they need them, of course, as they do perform well. So it is pretty gutsy to fire them in today's rather poor economic environment. But if you're really serious about building a collaborative company and want to reap the economic rewards from doing so, you have to screen for lone stars.
Q: Is there a particular industry or type of firm that is most susceptible to the lone star syndrome?
The problem with these people is that they can poison the organization.
— Morten T. Hansen
A: Companies, industries, and functions that reward hugely based on individual performance are prone to this problem. It is a problem in investment banking and can also be a problem in sales organizations where individuals are compensated for their own sales and not for helping others and sharing best practices.
Q: Could you describe the relationship between the collaborative organization and knowledge management?
A: Many companies have focused on knowledge management the last couple of years. While that has been a good start, it is only one part of the overall challenge of creating an effective collaborative organization. KM is only a special case of instilling a collaborative organization, which also includes coordinating activities and doing joint work across organization boundaries.
For example, Intuit's CEO, Steve Bennett, has worked hard to instill a collaborative culture in the company, but their the main focus is on coordinating activities, such as new product launches, across business units and functions, and the focus has been much less on KM. Whether it is sharing knowledge, coordinating activities, or doing joint work across boundaries, the essence of a collaborative approach is the same: to instill in employees the capacity to work horizontally across boundaries, without always having to rely on centralized command and a big corporate staff to make sure that the firm is integrated.
Q: You point to British Petroleum as an example of a large organization that was able to reinvent itself by instilling an atmosphere of collaboration and cooperation over decentralized individualism. How can large firms like BP collaborate among units and divisions and still remain financially profitable?
A: The approach at BP was developed precisely to improve the overall financial performance of the firm. What they recognized was that you can obtain both benefits: fierce focus on individual business units, which produces solid performance in each of the businesses, and an appropriate level of cross-unit interactions, which produces extra economic value through things like cost reductions, best practice transfers and additional revenues from cross-selling of products originally developed in one unit but are now sold in other units as well.
It has become a truism that sharing knowledge and collaboratingis good, but many times it is not.
— Morten T. Hansen
The trick is to develop managers that can do both well. I call them "T-shaped managers," that is, they focus on individual unit performance (the vertical part of the T) and contributions across units (the horizontal part of the T). BP has put in place several mechanisms to nurture T-shaped managers, including the development of peer groups and a dual performance review system where both individual and cross-unit performances are assessed.
Q: What is the biggest surprise that you have encountered in your research in the area of knowledge management and collaboration within organizations?
A: It has become a truism that sharing knowledge and collaborating is good, but many times it is not. For example, in one study that I just completed with my co-author Martine Haas at Cornell University, we studied whether sales teams were successful in securing client bids and found that many times sales teams that obtained lots of knowledge from databases and from colleagues performed worse (i.e., were more likely to lose the bid) than those than did not obtain and use such knowledge, in part because some teams underestimated the search and transfer costs involved in using knowledge and collaborating. The implication for managers is to know when to obtain knowledge and collaborate and when not to.
Q: What other research is going on?
A: With a colleague at London Business School, Bjorn Lovaas, I am continuing to investigate the essence of truly effective collaborative organizations. It is still a mystery to me why some companies are able to combine individual-unit focus and cross-boundary collaboration, while others are not. I also like to believe that the business world can become a healthier and more positive work environment if people know how to collaborate and are more willing to help others and ask for help. One thing we offer executives and managers of companies is a quick poll to identify what sorts of collaborative obstacles they may face in their organization and then we provide them with customized feedback.