Picking winners. Interview by Diane Coutu

In the business world, "creativity" has become the latest buzzword. How to attract, nurture, and direct the extraordinarily talented people who will come up with the next Lipitor, SonyWalkman, or iPod is an enduring topic among business-people. As the director of the MacArthur Fellows Program, Daniel J. Socolow has considerable experience with the process of rooting out creativity. In this conversation with HBR senior editor Diane Coutu, he describes how recipients of the "genius grant"--half a million dollars with no strings attached--are chosen. As significant as the money is, the recognition that comes with a fellowship may be more so. MacArthur grants provide powerful validation of the fellows' work, Socolow says, and that validation opens doors for people, whatever the field. Although the program keeps a lookout for entrepreneurs who are on the brink of major new advances, he believes that the market does a good job of rewarding the best ideas in business. Replicating the MacArthur model in a company would entail giving some employees unlimited time and lots of money to follow their own inclinations--not very feasible in most contexts. Nevertheless, the program has learned a lesson that may be valuable for business: The kind of creativity that leads to important breakthroughs is extremely hard to find. And, says Socolow, exceptionally creative people aren't always the obvious suspects, who may simply be good at promoting themselves: "Listen to others and look in the least likely places ... Extend your networks and try to get information from as many people as possible, just as we do".     

Building corporate character. Interview by Nan Stone

Stride Rite is a good company by any definition: Keds, Sperry Top-Siders, and Stride Rite children's shoes are consumer favorites for their fit, quality, and comfort. Wall Street analysts praise the company's outstanding financial performance. Innovative programs such as the first corporate child-care center and public service scholarships support Stride Rite's reputation as one of the most responsible employers and corporate citizens in the United States. Behind Stride Rite's good performance are the building blocks of corporate character: a legacy of quality and service and a leader committed to keeping that legacy lively. When Stride Rite shipped its first children's shoes in 1919, they came with the company's commitment "to produce an honest quality product in an honest way and deliver it as promised." For Arnold Hiatt, that commitment has been the driving force behind the company's evolution from manufacturing into marketing and product development as well as the guiding principle in its relations with consumers, dealers, suppliers, and employees. But Stride Rite's corporate character is also a reflection of Hiatt himself. In his early 20s, Hiatt fled a management training program "designed to make carnivores" out of its new employees and bought Blue Star Shoes, a small manufacturing company that had gone into Chapter 11. Through experience and "stumbling around," he built Blue Star's sales to $5 million-and got a practical education in management, markets, and human nature that has proved equally useful in running Stride Rite.     

The CEO as organizational architect: an interview with Xerox's Paul Allaire. Interview by Robert Howard

As chairman and CEO of the Xerox Corporation, Paul Allaire leads a company that is a microcosm of the changes transforming American business. With the introduction of the first plain-paper copier in 1959, Xerox invented a new industry and launched itself on a decade of spectacular growth. But easy growth led Xerox to neglect the fundamentals of its core business, leaving the company vulnerable to low-cost Japanese competition. Starting in the mid-1980s, Xerox embarked on a long-term effort to regain its dominant position in world copier markets and to create a new platform for future growth. Thanks to the company's Leadership through Quality program, Xerox became the first major U.S. company to win back market share from the Japanese. Allaire describes his efforts to take Xerox's corporate transformation to a new level. Since becoming CEO in 1990, he has repositioned Xerox as "the document company" at the intersection of the worlds of paper-based and electronic information. And he has guided the company through a fundamental redesign of what he calls the "organizational architecture" of Xerox's document processing business. Few CEOs have approached the process of organizational redesign as systematically and methodically as Allaire has. He has created a new corporate structure that balances independent business divisions with integrated R&D and customer operations organizations. He has redefined managerial roles and responsibilities, changed the way managers are selected and compensated, and renewed the company's senior management ranks. And he has articulated the new values and behaviors Xerox managers will need to thrive in a more competitive and fast-changing business environment.     

The post-capitalist executive. Interview by T George Harris

For half a century, Peter F. Drucker has influenced senior executives across the globe with his rare insight into socioeconomic forces and practical advice for navigating often turbulent managerial waters. In his latest contribution to HBR, Drucker discusses the impact of the ideas in his latest work, Post-Capitalist Society, on the day-to-day lives and careers of managers. Drucker argues that managers must learn to negotiate a new environment with a different set of work rules and career expectations. Companies currently face downsizing and turmoil with increasing regularity. Once built to last like pyramids, corporations are now more like tents. In addition, businesses in the post-capitalist society grow through many and varied complicated alliances often baffling to the traditional manager. Confronted by these changes, managers must relearn how to manage. In the new world of business, information is replacing authority as the primary tool of the executive. And, Drucker advises, one embarks on the road toward information literacy not by buying the latest technological gadget but by identifying gaps in knowledge. As companies increasingly become temporary institutions, the manager also must begin to take individual responsibility for himself or herself. To that end, the executive must explore what Drucker calls competencies: a person's abilities, likes, dislikes, and goals, both professional and personal. If executives rise to these challenges, a new organizational foundation will be built. While a combination of rank and power supported the traditional organization, the internal structure of the emerging organization will be mutual understanding and trust.     

The anxiety of learning. Interview by Diane L. Coutu

Despite all the time, money, and energy that executives pour into corporate change programs, the stark reality is that few companies ever succeed in genuinely reinventing themselves. That's because the people at those companies rarely master the art of transformational learning--that is, eagerly challenging deeply held assumptions about a company's processes and, in response, altering their thoughts and actions. Instead, most people just end up doing the same old things in superficially tweaked ways. Why is transformational learning so hard to achieve? HBR senior editor Diane Coutu explores this question with psychologist and MIT professor Edgar Schein, a world-renowned expert on organizational development. In sharp contrast to the optimistic rhetoric that permeates the debate on corporate learning and change, Schein is cautious about what companies can and cannot accomplish. Corporate culture can change, he says, but this kind of learning takes time, and it isn't fun. Learning is a coercive process, Schein argues, that requires blood, sweat, tears, and a certain level of anxiety to achieve the desired effect. In this article, he describes two basic types of anxiety--learning anxiety and survival anxiety--that drive radical relearning in organizations. Schein's theories spring from his early research on how American prisoners of war in Korea had been brainwashed by their captors. He cites the parallels between the "coercive persuasion" tactics the Chinese communists used to control their prisoners (isolating powerful ones and overseeing all communications) and the corporate boot camps that American companies use to indoctrinate their managers. Indeed, heavy socialization is back in style in U.S. corporations today, Schein says, even if no one is calling it that.     

The science of thinking smarter. Interview by Diane Coutu

Advances in neurobiology have demonstrated that the brain is so sensitive to external experiences that it can be rewired through exposure to cultural influences. Experiments have shown that in some people, parts of the brain light up only when they are presented with an image of Bill Clinton. In others, it's Jennifer Aniston. Or Halle Berry. What other stimuli could rewire the brain? Is there a Boeing brain? A Goldman Sachs brain? No one really knows yet, says Medina, a developmental molecular biologist, who has spent much of his career exploring the mysteries of neuroscience with laypeople. As tempting as it is to try to translate the growing advances to the workplace, he warns, it's just too early to tell how the revolution in neurobiology is going to affect the way executives run their organizations. "If we understood how the brain knew how to pick up a glass of water and drink it, that would represent a major achievement," he says. Still, neuroscientists are learning much that can be put to practical use. For instance, exercise is good for the brain, and long-term stress is harmful, inevitably hurting productivity in the workplace. Stressed people don't do math very well, they don't process language very efficiently, and their ability to remember--in both the short and long terms--declines. In fact, the brain wasn't built to remember with anything like analytic precision and shouldn't be counted on to do so. True memory is a very rare thing on this planet, Medina says. That's because the brain isn't really interested in reality; it's interested in survival. What's more, and contrary to what many twentieth-century educators believed, the brain can keep learning at any age. "We are lifelong learners," Medina says. That's very good news indeed."     

Execution without excuses. Interview by Thomas A. Stewart and Louise O'Brien

The success of Dell--it provides extraordinary rewards to shareholders, it can turn on a dime, and it has demonstrated impeccable timing in entering new markets--is based on more than its famous business model. High expectations and disciplined, consistent execution are embedded in the company's DNA. "We don't tolerate businesses that don't make money," founder Michael Dell tells HBR. "We used to hear all sorts of excuses for why a business didn't make money, but to us they all sounded like 'The dog ate my homework.' We just don't accept that." In order to double its revenues in a five-year period, the company had to adapt its execution-obsessed culture to new demands. In fact, Michael Dell and CEO Kevin Rollins realized they had a crisis on their hands."We had a very visible group of employees who'd gotten rich from stock options," Rollins says. "You can't build a great company on employees who say, 'If you pay me enough, I'll stay.'" Dell and Rollins knew they had to reignite the spirit of the company. They implemented an employee survey, whose results led to the creation of the Winning Culture initiative, now a top operating priority at Dell. They also defined the Soul of Dell: Focus on the customer, be open and direct in communications, be a good global citizen, have fun in winning. It turned outto be a huge motivator. And they increased the focus on developing people within the company. "We've changed as individuals and as an organization," Rollins says. "We want the world to see not just a great financial record and operational performance but a great company. We want to have leaders that other companies covet. We want a culture that makes people stick around for reasons other than money."     

Managing for the next big thing. Interview by Paul Hemp

In this HBR interview, CEO Michael Ruettgers speaks in detail about the managerial practices that have allowed EMC to anticipate and exploit disruptive technologies, market opportunities, and business models ahead of its competitors. He recounts how the company repeatedly ventured into untested markets, ultimately transforming itself from a struggling maker of minicomputer memory boards into a data storage powerhouse and one of the most successful companies of the past decade. The company has achieved sustained and nearly unrivaled revenue, profit, and shareprice growth through a number of means. Emphasizing timing and speed, Ruettgers says, is critical. That's meant staggering products rather than developing them sequentially and avoiding the excessive refinements that slow time to market. Indeed, a sense of urgency, Ruettgers explains, has been critical to EMC's success. Processes such as quarterly goal setting and monthly forecasting meetings help maintain a sense of urgency and allow managers to get early glimpses of changes in the market. So does an environment in which personal accountability is stressed and the corporate focus is single-minded. Perhaps most important, the company has procedures to glean insights from customers. Intensive forums involving EMC engineers and leading-edge customers, who typically push for unconventional solutions to their problems, often yield new product features. Similarly, a customer service system that includes real-time monitoring of product use enables EMC to understand customer needs firsthand.     

Transforming an industrial giant. Interview by Thomas A. Stewart and Louise O'Brien

In his 12 years at the helm of Siemens, CEO Heinrich von Pierer designed and directed a major transformation. Taking this German icon from a technically superb but slow-moving industrial giantto a disciplined yet nimble multinational has posed enormous challenges. Since 1992, Siemens has revamped its portfolio of businesses, expanded its reach into 192 countries, and created a more local-market-driven culture, gaining recognition as one of the best-managed and most competitive companies in the world. In this edited interview with HBR editor Thomas A. Stewart and consulting editor Louise O'Brien, von Pierer describes the requirements for transformation and culture change and how he broke down historical barriers at Siemens. He shares his insights about portfolio restructuring, his lessons from competing with GE, and the pros and cons of being based in Europe versus America. He reflects on the true start of globalization after the fall of the Berlin wall and on how dramatically the company needed to change in order to counter the resulting pricing pressures across all of its businesses. He talks, too, about the biggest challenge on his successor's desk-"the particular challenge of China;" he says. Amid all these topics, von Pierer reiterates the importance of people: "We all talk about people as our most important resource, but as a matter of fact, who's really taking care of people?... We need [their] backing. We can't afford to run into a situation where people no longer accept what we do."     

Giving great advice. Interview by Thomas A Stewart and Gardiner Morse

Few deal makers have been at it as long, and at such a high level, as Bruce Wasserstein, the chairman and CEO of the financial advisory and asset-management firm Lazard. In this edited interview, two HBR editors explore how he creates value as a manager, as a deal maker, and as a counselor to CEOs. Wasserstein, who has been a major figure in mergers and acquisitions for more than 30 years, talks about attracting and managing talent, building and sustaining a knowledge business, sizing up industries and companies, and crafting advice to help CEOs unlock value. At the heart of his approach is a singular ability to dissect a strategy's underlying premises in order to figure out whether a plan or deal "makes sense." Part of that determination involves understanding the broader context: Where is the industry going? What external factors will affect it? Such sensemaking informs every move Wasserstein makes, and it has paid off handsomely. In his career, he has helped broker more than a thousand deals, worth hundreds of billions of dollars. His intellect, creativity, and doggedness are what allow him to pick apart the most complex problems and devise novel solutions. In an age of specialization, he recognizes the importance of connecting the dots; he draws on the knowledge and skills of creative generalists as well as industry and regional specialists when setting up and executing deals. Wasserstein studied at Harvard University's business and law schools and at Cambridge University, helped lead First Boston's M&A practice, cofounded the investment-banking firm Wasserstein Perella Group, and then joined Lazard, which he famously took public in 2005 after disassembling a century and a half of family ownership. He is the 2007 recipient of Harvard Law School's Great Negotiator Award.     

两国都有美好的未来 专访印度驻华大使苏杰生博士

我们一定要拘泥于历史吗?印度和中国都在崛起。两国都有非常美好的未来。这需要用乐观和积极的态度来看待两国关系。     

Outlook for hospitals: systems are the solution. Interview by Jeff C. Goldsmith

Like all industries, the health care industry undergoes change. A fragmented system of isolated, free-standing community hospitals is undergoing rapid consolidation into large multihospital corporations and systems. If the history of other industries is any guide, this consolidation will accelerate as the nation instills greater economic competition in the health marketplace. In the future, say the managers of two very different hospital networks, large multihospital systems will predominate. Two big questions, then, are: Should these systems be proprietary or voluntary? And how should they go about meeting people's changing health care needs? These interviews with the physician founders of two multihospital organizations, Hospital Corporation of America in Nashville and Rush-Presbyterian-St. Luke's Medical Center in Chicago, focus on these organizations' contrasting corporate strategies and on the mechanisms that will enable them to survive a shakeout in the industry. The differences between the two systems are linked to the philosophies of their founders, who disagree about how and where patients will get the best treatment.     

Managing emotional fallout. Parting remarks from America's top psychiatrist. Interview by Diane Coutu

Last fall, the United States was brutally thrust into a new and dangerous world. As the twin towers of the World Trade Center collapsed and the Pentagon burned, the horrible reality of terrorism seared the American consciousness. It touched more than the victims and their families; everyone who sat transfixed before the horrific images on TV lived through the trauma. In a sense, we were all eyewitnesses, and we must all cope with feelings of anger, stress, and anxiety. That poses a huge immediate challenge for business, because it is largely in the workplace--where we spend so many of our waking hours--that we will confront these emotions. And many companies have risen to the challenge, establishing new guidelines for processing mail in light of anthrax fears and organizing stress reduction programs for employees. While the logic of taking such action is incontestable, it raises a much larger question: What responsibility does a company bear for the mental well-being of its work-force? If companies help employees deal with depression and anxiety in the wake of terrorist acts, doesn't that put mental health care on the business agenda? To answer these questions, HBR senior editor Diane Coutu talked with Dr. Steven Hyman, the former director of the National Institute for Mental Health. In this interview, he discusses the implications of coping with tragedy, the resilience of individuals, and the treatment of mental illness. And he suggests that September 11, 2001, may come to be seen as a tipping point--the moment when managers started to think about dealing with mental health issues on a regular basis.     

Leading change when business is good. Interview by Paul Hemp and Thomas A. Stewart

Lou Gerstner's was a hard act to follow. As CEO in what were arguably IBM's darkest hours, Gerstner brought the company back from the brink. After nearly ten wrenching years, in which the big-machine manufacturer remade itself into a comprehensive software, hardware, and services provider, business was looking good. So the challenge for Sam Palmisano, when he took over as CEO in 2002, was to come up with a mandate for a second act in the company's transformation. His primary aim was to get different parts of the company working together so IBM could offer customers "integrated solutions"--hardware, software, services, and financing--at a single price. As part of this effort, he asked all of IBM's 320,000 employees, in 170 countries, to weigh in on a new set of shared corporate values. Over a 72-hour period, thousands of IBMers throughout the world gave Palmisano and his executive team an earful in an intranet discussion dubbed "Values-Jam," an often-heated debate about the company's heart and soul. Twenty-four hours into the exercise, at least one senior exec wanted to pull the plug. The jam had clearly struck a chord with employees, but it was a dissonant one, full of rancor and discontent. Palmisano let the discussion continue, and the next day, the mood began to shift. The criticism became more constructive. Out of the million words generated by the jam grew a set of values that, as Palmisano explains in this interview, are meant to guide the operational decisions made by IBM's employees-and, more important, to serve as Palmisano's mandate to continue the reinvention of the company.     

How to restore the fiduciary relationship. An interview with Eliot Spitzer. Interview by Louise O'Brien

Eliot Spitzer's investigations into the mutual fund and investment-banking industries have made the New York State attorney general the de facto flag bearer of corporate reform. His exposure of conflicts of interest between investment bankers and research analyst in Wall Street firms led to the $1.4 billion global settlement between regulators and banking houses in 2003. In this interview, Spitzer describes the challenge of protecting public markets from conflicts of interest, paying particular attention to how such conflicts get institutionalized in an industry. "The cases that have gotten me and my fellow regulators most upset are the ones where we've seen senior management being tolerant of rank abuses," he says. "Because then you know that the entire structure is rotten." He also points the finger squarely at boards, maintaining that board members are drawn from pools of company and industry insiders. He cites "a void in values in a lot of boardrooms," holding up executive compensation as a powerful example. "Board compensation committees ... are self-selected and interwoven--it's a rigged marketplace." He continues, "It would be interesting to see what the world would look like if CEO pay packages had to be submitted to shareholder votes." Spitzer suggests that what's really needed is for all business leaders to reinstill throughout their organizations the critical notion of a fiduciary duty--whether it is to the shareholder or to the customer. Using the mutual fund industry as an example, he also contrasts the value of enforcement with that of regulation and articulates an important--and surprisingly limited--role for government in protecting free markets.