MIT Sloan Management Review

Sponsored Content: This Strategy Guide describes why a skills-powered approach is needed, the benefits it brings, the challenges organizations commonly face in making the transition, and what a successful skills-powered organization looks like. Read now: https://mitsmr.com/3wfVxTd

The Hard Truth About Business Model Innovation Classic read: http://mitsmr.com/2cWGGTa

Sponsored Content: How today’s retailers can create cloud-backed, future-fit environments. https://mitsmr.com/44rCOjZ

The proverbial ship of artificial intelligence is moving ahead at warp speed, icebergs and societal risks be damned. The pace of change in what it can do is staggering. Breathless predictions say AI will add trillions of dollars to the economy through massive cost savings and entirely new products and markets. While the capabilities of AI, along with both excitement and fear, are exploding, it’s a good time to ask what AI might mean for the world’s serious challenges (climate change, inequality, threats to democracy, and more). Will it help us or hinder us … or both? What does AI mean for the quest for a more regenerative and net-positive world? This could obviously be a book-length discussion, but let me focus on four big categories of impact — AI’s upside for helping on climate change and sustainability, its rising energy demands, the dangers of AI-enhanced misinformation, and its impact on people’s livelihoods — and provide a snapshot of where we are right now. https://mitsmr.com/4cC8Lcz

What do the youngest people in your organization want in a hybrid work strategy? Hint: They’re the least likely to want to be fully remote or fully in-office. Today’s 20-somethings want virtual and in-person touch points with the middle managers just above them, write Brian Elliott and Amanda Schneider. Some companies decided to “fix” the problem using return-to-office mandates — and found that this drives away high performers, the very people who make good coaches for Gen Z talent.

Recent return-to-office (RTO) mandates like those at UPS and Boeing have a simple message: Come back to the office five days a week. CEOs cite productivity as a core reason for these proclamations, even in the face of employee resistance. Many executives simply don’t trust that employees are as effective as possible when managers can’t see them at their desks. But in a world of globally distributed teams, falling back on management-through-monitoring is falling back on the weakest form of management — and one that drives down employee engagement. There is mounting evidence that mandates don’t improve financial performance. Instead, they damage employee engagement and increase attrition, especially among high-performing employees and particularly those with caregiving responsibilities. There is a better way forward, but it requires culture work at the top as well as deep within organizations, along with a significant upgrade in management philosophy. Too many organizational cultures use face time at the office as their metric for productivity. That’s not the best benchmark. Instead, focusing on outcomes while providing trust and flexibility about where and when to get work done allows individuals and organizations to thrive. https://mitsmr.com/3TJHhec

Reports that U.S. productivity was up 3% in the fourth quarter of 2023 were seen as good news for the economy. But to understand what’s really happening — and avoid the perils of misplaced confidence within C-suites across the country — it’s important to dig deeper. Last year, businesses used more methods to track their employees’ productivity than in previous years. But businesses that stepped up their scrutiny of employee performance did not see bigger productivity gains. And in adopting all those new methods, they cut back on something even more important — growth and development — which will hurt them in the long run. In our latest annual study of management trends, we surveyed more than 600 employees in the fourth quarter of 2023 across a wide range of industries and job functions. We also conducted a roundtable discussion with 15 leaders to gauge their priorities, challenges, and concerns. We found that workers are broadly frustrated with the steps their companies are taking to track their output. Only 39% feel that their companies conduct a fair and consistent evaluation, a big drop from 48% in 2021. We also found that companies began using more tools last year to track their staffs’ output. Their approaches included evaluating business goals or OKRs (objectives and key results) throughout the year, having employees complete self-assessments, asking colleagues to provide feedback on one another, and more. The top reason for conducting these assessments, employees said, was to lift productivity. Continue reading: https://mitsmr.com/3ztYeBB

Most companies address burnout with efforts like encouraging vacations, hosting company gatherings, or making mindfulness apps available to employees. These are all valid options, and they do help people recharge, but they don’t necessarily address the underlying source of people’s exhaustion or detachment. Once people return from a vacation, for instance, the conditions that caused their detachment often simply resume. This is where understanding the sentiments in context can also provide a path for action. If feeling unappreciated is a symptom, think about how to help people feel recognized for their accomplishments. If the problem is lack of control over a flood of projects, consider how to give employees more agency and empowerment to prioritize their work. https://mitsmr.com/41w9gOY

Sponsored Content | Data-driven medical screenings save lives. But they come with some privacy concerns. Learn how the “marriage of biology and digital engineering” is reshaping health care. https://mitsmr.com/3Kk6fez

Leaders can’t escape the global imperative to reduce the contributions businesses make to environmental degradation, but deep down, many harbor doubts: Can a profit-driven organization also be sustainable? Pressure to grow revenue and control costs is constant. How can a leader feel confident in pursuing more sustainable choices and defending them to boards and shareholders sensitive to the often higher costs of greener approaches? The dueling pressures to do business sustainably and to maximize profits leave many leaders stuck, unsure what to do. https://mitsmr.com/3WeXHMZ