Roger L. Martin > Quotes

“If you can define the problem differently than everybody else in the industry, you can generate alternatives that others aren’t thinking about.”
― Roger L. Martin, The Opposable Mind: How Successful Leaders Win Through Integrative Thinking

“simplification, 80–20 style, leads to more business as usual.”
― Roger L. Martin, The Opposable Mind: How Successful Leaders Win Through Integrative Thinking

“Shareholders have a residual claim on a firm’s assets and earnings, meaning they get what’s left after all other claimants—employees and their pension funds, suppliers, tax-collecting governments, debt holders, and preferred shareholders (if any exist)—are paid. The value of their shares, therefore, is the discounted value of all future cash flows minus those payments. Since the future is unknowable, potential shareholders must estimate what that cash flow will be; their collective expectations about the future determine the stock price. Any shareholders who expect that the discounted value of future equity earnings of the company will be less than the current price will sell their stock. Any potential shareholders who expect that the discounted future value will exceed the current price will buy stock. This means that shareholder value has almost nothing to do with the present. Indeed, present earnings tend to be a small fraction of the value of common shares. Over the past decade, the average yearly price-earnings multiple for the S&P 500 has been 22x, meaning that current earnings represent less than 5 percent of stock prices.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“Other data confirms this pattern, and perhaps there is no better illustration of how the average workers are losing out than the dramatic shift in the relationship between productivity growth and wage growth of nonsupervisory workers—the regular Americans we interviewed. Historically, up through the mid-1970s, there was an extremely tight relationship between productivity growth and wage-compensation growth. If workers were more productive, their pay went up proportionately, an outcome that spread the rewards of growth broadly, because economic growth and productivity growth are tightly coupled. For example, between 1948 and 1972, productivity grew 92 percent and wage compensation 88 percent—and they tracked each other closely each year. That meant that if workers produced more economic output for their employers, they were compensated with increased wages mirroring almost exactly the increase in output—fairness in the extreme. In 1972, however, that relationship broke up, and between 1972 and 2018, while productivity grew by 84 percent, growth in wage compensation barely budged, growing just 13 percent, or 0.25 percent per year for forty-six years (see figure I-2).”
― Roger L. Martin, When More Is Not Better: Overcoming America's Obsession with Economic Efficiency

“Design for habit As we’ve seen, the best outcome is that your offering becomes the object of an automatic response. So, design for that—don’t leave the outcome entirely to chance. We’ve seen how Facebook profits from its attention to consistent, habit-forming design,”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“But this time, if and when discontented Americans like Amy and Sarah do reengage with democracy, it’s by no means clear that they will vote to stick with the capitalism part of the American model. The 1970s represented the first protracted stumble after the recovery from the Great Depression, with two oil-price shocks and a nasty recession mid-decade. Had recovery from those challenges been as strong as that in the late 1930s and 1940s, no doubt faith in the system would once again have been vindicated. Instead, as the data shows, the post-1970s decades have been, for Americans like Amy and Sarah, a slow drip feed of disappointment and frustration. In this environment, a more sinister narrative about capitalism has been taking root. Capitalism is no longer unambiguously about everybody working hard and getting ahead—it is about the benefit of overall economic growth flowing so disproportionately to rich people that there just isn’t enough left for average Americans to consistently advance. If the little that does trickle down isn’t enough to keep Amy and Sarah afloat, then sooner or later they will wonder why they trust the management of the economy to Wall Street CEOs and Beltway politicians and policy wonks. And then they will surely reengage with the democratic part of the US system—probably with dramatic and potentially harmful results. To be sure, it is always tempting to look for a clear, easily identified whipping boy—a bad president, an atrocious piece of legislation, callous Wall Street, venal hedge funds, the unfettered internet, runaway globalization, or self-absorbed millennials. While no one of these can be held responsible for the yawning inequality of the US economy and the alienation that it engenders, many actors have played a role. It has taken almost half a century of both Democratic and Republican presidents and houses of Congress to get us to the current point. And if numerous actors are in part responsible, then we have to ask—given all that the data shows—whether there may be a fundamental structural problem with democratic capitalism. If so, can we fix it?”
― Roger L. Martin, When More Is Not Better: Overcoming America's Obsession with Economic Efficiency

“Perhaps more worrisome, while government policies should be intended to serve the many for the long term, they are being gamed by interested parties to ensure that they serve the few in the short term, with damaging impact over the long term. The Persona Project respondents could feel this. To them, they were outsiders and others were playing the game to their own advantage, and to the respondents’ disadvantage. These outcomes are systemic, and without a fundamental shift in how we manage the economy, they will get only more out of alignment with our hopes and assumptions. I believe that this shift needs to start with abandoning the perfectible-machine model of the economy. We should instead understand the economy in more natural terms, as a complex adaptive system—one that is too complex to be perfectible, one that continuously adapts in ways that will almost certainly frustrate any attempts to engineer it for perfection. In addition, rather than striving singularly for ever more efficiency, we need to strive for balance between efficiency and a second feature: resilience.”
― Roger L. Martin, When More Is Not Better: Overcoming America's Obsession with Economic Efficiency

“This insight prompted Lafley to switch the bonus metric from TSR to something called operating TSR, which is based on a combination of three real operating performance measures—sales growth, profit margin improvement, and increase in capital efficiency. His belief was that if P&G satisfied its customers, operating TSR would increase, and the stock price would take care of itself over the long term. Moreover, operating TSR is a number that P&G’s business unit presidents can truly influence, unlike the market-based TSR number.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“In strategy, what counts is what would have to be true—not what is true. To put it in scientific terms, developing a winning strategy involves the creation and testing of novel cause-effect hypotheses and the identification of what must be different about the world for those hypotheses to work.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“We push teams to specify in detail the advantage they aim to achieve or leverage, the scope across which the advantage applies, and the activities throughout the value chain that would deliver the intended advantage across the targeted scope. Otherwise, it is impossible to unpack the logic underlying a possibility and to subject the possibility to subsequent tests.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“A Complement to Choice I don’t claim that consumer choice is never conscious, or that the quality of a value proposition is irrelevant. To the contrary: people have to have a reason to buy a product in the first place. And sometimes a new technology or a new regulation enables a company to demand consideration of a product—by radically lowering the price, offering new features, or providing a wholly new solution to a customer need. Robust where-to-play and how-to-win choices, therefore, are still essential to strategy. Without a value proposition superior to those of competitors that are attempting to appeal to the same customers, a company has nothing to build on.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“Fundamentally, the conventional thinker prefers to accept the world as it is. The integrative thinker welcomes the challenge of shaping the world for the better.”
― Roger L. Martin, The Opposable Mind: How Successful Leaders Win Through Integrative Thinking

“Mastery is an enabling condition for originality, which in turn, is a generative condition for mastery. The modes are interdependent.”
― Roger L. Martin, The Opposable Mind: How Successful Leaders Win Through Integrative Thinking

“The Chinese character for “crisis,” he pointed out to me, combines the characters for “danger” and “opportunity.”
― Roger L. Martin, The Opposable Mind: How Successful Leaders Win Through Integrative Thinking

“I find that most teams consider three to five possibilities in depth. On one aspect of this question, I am adamant: the team must produce more than one possibility. Otherwise, it never really started the strategy-making process because it didn’t see itself as facing a choice. Analyzing a single possibility is not conducive to producing optimal action—or, in fact, any action at all.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“Peter Drucker had it right when he said that the primary purpose of a business is to acquire and keep customers.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“It is impossible to begin to learn that which one thinks one already knows.”
― Roger L. Martin, The Opposable Mind: How Successful Leaders Win Through Integrative Thinking

“Having recognized that a choice needs to be made, you can now turn to the full range of possibilities you should consider. These might be versions of the options already identified.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“The Problem-Solving Power                of Integrative Thinking The test of a first-rate intelligence is the ability to hold two opposing ideas in mind at the same time and still retain the ability to function. One should, for example, be able to see that things are hopeless yet be determined to make them otherwise.1 —F. Scott Fitzgerald”
― Roger L. Martin, The Opposable Mind: How Successful Leaders Win Through Integrative Thinking

“Consider Johnson & Johnson. It has the corporate world’s single most eloquent statement of purpose—its “credo,” which hasn’t changed since J&J’s legendary chair Robert Wood Johnson created it in 1943. Here it is, in abbreviated form: We believe our first responsibility is to the doctors, nurses, and patients, to mothers and fathers and all others who use our products and services.… We are responsible to our employees, the men and women who work with us throughout the world.… We are responsible to the communities in which we live and work and to the world community as well.… Our final responsibility is to our stockholders.… When we operate according to these principles, the stockholders should realize a fair return. The credo bluntly spells out the pecking order: customers come first, and shareholders last. However, J&J has confidence that when customer satisfaction is at the top of the list, shareholders will do just fine.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“Processing fluency is itself the product of repeated experience, and it increases exponentially with the number of times we have the experience. Perceiving and identifying an object is improved by prior exposure to that object. As an object is presented repeatedly, the neurons that code features not essential for recognizing the object dampen their responses and the neural network becomes more selective and efficient at object identification. Repeated stimuli have lower perceptual-identification thresholds, require less attention to be noticed, and are faster and more accurately named or read. What’s more, consumers tend to prefer them to new stimuli.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“To break through the impasse, you have to change the way you think about making a successful strategy: In strategy, what counts is what would have to be true—not what is true. To put it in scientific terms, developing a winning strategy involves the creation and testing of novel cause-effect hypotheses and the identification of what must be different about the world for those hypotheses to work. And a structured development of novel hypotheses is as much a scientific process as the structured analysis of data. In”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“I suppose can be seen as our manifesto for what it will take to save democratic capitalism from itself. The marriage of democracy and capitalism has been arguably the greatest force for good in history, giving the creativity and enterprise of talented individuals the freedom to generate value in which all of us can share. History also shows, however, that its continued survival cannot be guaranteed, if we do not show the system our respect. I hope this book will help save democratic capitalism from itself.”
― Roger L. Martin, When More Is Not Better: Overcoming America's Obsession with Economic Efficiency

“American pragmatist philosopher Charles Sanders Peirce’s observation that no new idea in the history of the world has been proven in advance analytically, which means that if you insist on rigorous proof of the merits of an idea during its development, you will kill it if it is truly a breakthrough idea, because there will be no proof of its breakthrough characteristics in advance. If you are going to screen innovation projects, therefore, a better model is one that has you assess them on the strength of their logic—the theory of why the idea is a good one—not on the strength of the existing data. Then, as you get further into each project that passes the logic test, you need to look for ways to create data that enables you to test and adjust—or perhaps kill—the idea as you develop it.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“possibility is essentially a happy story that describes how a firm might succeed. Each story lays out where the company plays in its market and how it wins there. It should have internally consistent logic, but it need not be proved at this point. As long as we can imagine that it could be valid, it makes the cut. Characterizing possibilities as stories that do not require proof helps people discuss what might be viable but does not yet exist. It is much easier to tell a story about why a possibility could make sense than to provide data on the odds that it will succeed. A”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“This is why the goal of shareholder value maximization and the compensation approach that goes with it are bad for shareholders. The very executives who must achieve the goal realize that they can’t. Talented executives can grow market share and sales, increase margins, and use capital more efficiently, but no matter how good they are, they can’t increase shareholder value if expectations get out of line with reality. The harder a CEO is pushed to increase shareholder value, the more the CEO will be tempted to make moves that actually hurt the shareholders.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“Constructing strategic possibilities, especially ones that are genuinely new, is the ultimate creative act in business. No one in the rest of the beauty industry would have imagined P&G’s completely reinventing Olay and boldly going head-to-head against leading prestige brands. To generate such creative options, you need a clear idea of what constitutes a possibility. You also need an imaginative yet grounded team and a robust process for managing debate.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“Although Levels 1 through 6 are available to us in virtually all of our joint choice-making situations, unfortunately we take on either Level 1 or Level 6 responsibility in the vast majority of cases.”
― Roger L. Martin, The Responsibility Virus: How Control Freaks, Shrinking Violets-and The Rest Of Us-can Harness The Power Of True Partnership

“It’s extremely difficult—and socially risky—to question an established model that many people believe and to start building a new model from scratch.”
― Roger L. Martin, A New Way to Think: Your Guide to Superior Management Effectiveness

“You can’t make a renaissance person anymore, because the range of what you would need to do is just impossible. But you could actually assemble a renaissance team.”7 The integrative thinkers rely on their “renaissance teams” to broaden salience, maintain sophisticated causality, and create a holistic architecture in their drive for creative resolution.”
― Roger L. Martin, The Opposable Mind: How Successful Leaders Win Through Integrative Thinking