The Neuroscience of Wisdom - The Development and Application of Wisdom in a Business Context

© Merryck & Co 2013

The Neuroscience of WisdomThe Development and Application of ‘Wisdom’ in a Business Context

Invitation-only WebcastFebruary 5, 2013

© Merryck & Co 2013 2

Ethan Kross, Ph.D.

Assistant Professor, Social PsychologyDirector, Emotion and Self-Control LaboratoryUniversity of Michigan Ethan received his BA from the University of Pennsylvania and his MA and Ph.D. from Columbia University. He is an Assistant Professor in the Psychology Department at the University of Michigan and the Director of the University of Michigan Emotion and Self-Control Laboratory. He is also a Faculty Associate at the University of Michigan's Research Center for Group Dynamics and Depression Research Center. The overarching goal of Ethan's research is to shed light on the psychological and physiological processes that enable people to adaptively regulate impulses and emotions that undermine their goals and compromise their health. He uses a variety of tools (e.g., behavioral, diary, physiological, neuroscience-fMRI methods) to address this issue and focuses on both normal-healthy and clinical populations.


David Reimer

CEO, Merryck & Co.

David leads an organization of former top executives who work 1:1 with current business leaders and their high potential successors.

His work over the past decade has included consulting on global M&A and restructuring projects with 30% of the Fortune 100, including through the dot.com aftermath and, during the financial crisis, the three largest financial services mergers in history. He most recently led the 3-year private equity turnaround of Drake Beam Morin’s (DBM) North American business. Earlier, while in Asia Pacific, David juggled a mix of wholly-owned, joint venture and affiliate business units in 14 countries, which included launching wholly-owned operations in China.

David is a frequent writer and speaker on how great leaders develop on-the-job, in the heat of the crucible.


Welcome

GuestDr. Ethan KrossAssistant Professor, Department of PsychologyUniversity of Michigan

Director, University of Michigan Emotion and Self-Control Laboratory

InterviewerDavid ReimerChief Executive Officer, Merryck & Co.


Discussion Framework

The Context: Why this conversation?

The Challenge: Wisdom in the lab and workplace

The Conversation: Development and application

Q&A

1

2

3

4


The Context

What is the impact of wisdom on decision-making, attitude and behavior?

Defining wisdom – in the lab or in the workplace

Understand

That there are limits associated with one’s own knowledge

Recognize

That the world is in flux and likely to change

Promote

The “common good” rather than focusing narrowly on one’s self-interest

Demonstrate

The ability to take on the perspectives of others


The Context

Other changes for ExCo Executives in the Fortune 500 and S&P 500 1990 2010

Vertical promotions since entering workforce 1 11.4 7.1

Years per “level” (pre-ExCo) 1 3.6 4.4

Companies per career 1, 2 2.1 5.3

Revenue under management 1,3 $123 MM $1.3 B

CEOs promoted from within 4 62% 77%

Connections/relationships to manage 1,5 ~20 ~50-70

1) Merryck & Co data 1998-20122) WSJ July 6 2010, Joanne S Lublin, “CEO Tenure, stock gains often go hand in hand”3) Merryck & Co data 1998-2012; CNNMoney.com, Fortune 500 Statistics4) SpencerStuart 2010 CEO Transitions, March 20115) Merryck & Co data, 1998-2012; Booz & Company 2010 10-yr CEO Succession Study Retrospective

The scope of business leadership has increased by an order of magnitude. The pace of technological disruption alone is 100X today what it was in 1980.


The Challenge

Can the impact of wisdom be measured?

How does this show up in the business world?

Can the development of wisdom be accelerated?

1. 2. 3.

Ethan Kross David Reimer


Lab Study #1: Sample questions

Topic/Country Summary

Immigration/Tajikistan Because of the economic growth of Tajikistan, many people from Kyrgyzstan immigrate to the country. Whereas Kyrgyz people try to preserve their customs, Tajiks want Kyrgyz people to assimilate fully and abandon their customs.

Natural resources/Chuuk Huge crude oil resources have been discovered in the economically disadvantaged Chuuk state. Because of governmental restrictions, many interested firms cannot establish the required infrastructure for production. On the one side, government tries to preserve the ancient laws. On the other side, there are also a huge number of people in Chuuk who would like to eliminate the regulations entirely.

Ethnic tensions/Djibouti Two ethnic groups in Djibouti, the Issa and the Afari, have completely different perspectives on politics. Whereas one group tries to preserve traditions, the other group wants to alter the society entirely. Both groups are very strong.

Can the impact of wisdom upon problem-solving be measured?


Merryck Pilot Study

Question: What if any monitoring systems (whether self-directed or gauged from others) do you use to ensure that you’re performing well when under duress?

Ages 30-50 Ages 51+

Self-Monitored Only

Social Cues

54%

46%

20%

80%

(18.8%)

(75%)


Lab Study #2

Participants Framework

Recent graduates and senior-year college students who had been unable to secure employment were asked to predict how the future would unfold.

Participants were first instructed to “take a few minutes to think about how the current economic climate will impact you personally.” They were then randomly assigned to reason aloud to an interviewer about how the recession would impact their career prospects from an “immersed” or “distanced’ perspective.

Strongly liberal and conservative voters in the three weeks before the 2008 presidential election.

Participants were asked to think about how various foreign and domestic issues would play out over the next 4 years if the candidate that they did not endorse won the election from either an “immersed” or “distanced” perspective.

Can other factors be substituted for the passage of time in the development of wisdom?


The Conversation

The complexity of upper echelon jobs increases exponentially, whereas a leader‘s development happens Incrementally.

The nature of dynamic problems defies predictable patterns of straightforward problem-solving.

The next generation of leader development will empower those with the most influence to respond with the greatest possible perspective.

Can wisdom be developed?

Understand

That there are limits associated with one’s own knowledge

Recognize

That the world is in flux and likely to change

Promote

The “common good” rather than focusing narrowly on one’s self-interest

Demonstrate

The ability to take on the perspectives of others


The Conversation

“Wisdom” language

Business outcomes

What are the challenges?

Buzz Motivation

13Ethan Kross David Reimer


The Takeaways

In a wicked-problem world, every organization’s priority must be to get top leaders ready for anything to the most realistic extent possible.

As complexity and stakes have grown by orders of magnitude, the development of perspective and the ability to transcend self-interest allows for much better reasoning concerning real-world scenarios.

One of the surest, fastest ways to increase perspective is to model and exercise methods for creating distance between the decision-maker and the decision. In an organizational context, such exercises work best when grounded within the business framework.

1. 2. 3.


Who is Merryck?

Over 15 years, Merryck has become the proven global vehicle for fast-tracking a leader’s magnitude

Has run a $750MM - $120B P&L within a messy, complex, often global scale

Is chosen for ability to identify strengths, and to define and help develop the blind side

Mentoring 1-on-1 with a former C-level executive who:

Is trained in-depth to support with questions and to develop executive perspective —not to take on the job

Is up to speed on the company’s issues and the dynamics of the leader’s role


For further discussion:

Robin Beckhard, Senior Vice President

[email protected]

1-888-MERRYCK

www.Merryck.com

The Neuroscience of Wisdom - The Development and Application of Wisdom in a Business Context

Documents

Transcript of The Neuroscience of Wisdom - The Development and Application of Wisdom in a Business Context