沃顿商学院全套笔记-二十四-

沃顿商学院全套笔记（二十四）

沃顿商学院《商务基础》｜Business Foundations Specialization｜（中英字幕） - P75：27_4 4 Plainview技术案例部分3.zh_en - GPT中英字幕课程资源 - BV1R34y1c74c

Hello， I'm Professor Brian Boucher。 Welcome back。 In this video。

we're going to talk about liquidity ratios， both short-term and long-term， liquidity。

and then we'll apply those ratios to the plainview technology case。 Let's get started。

Here's an overview of all the liquidity ratios we're going to look at， and you can put them。

into three buckets， two short-term buckets and one long-term bucket。

First， we have a number of ratios that are going to tell us whether we have enough assets。

that are going to turn into cash to cover our liabilities in the next period。

Then the next bucket will look at specifically whether we have enough liquidity to meet interest。

obligations。

And the third bucket is going to be the long-term liquidity ratios。

And these are going to be more about the notion of riskiness。 Is the firm too highly levered？

Is there a potential risk of bankruptcy down the road that may cause equity investors。

to lose their investment？ What's the company's borrowing capacity？

Those are all the questions that this set of ratios will get at。

So going to that first bucket of short-term liquidity ratios， we're trying to answer the。

question， does the company have enough cash coming in to cover its obligations to pay。

out cash in the near term？

Ideally， all the ratios that we look at would be over one， which means there's more cash。

coming in than cash we have to pay out。

But again， you'd have to benchmark this with the industry， the firm across time， because。

for some industries， these are not greater than one。

The first ratio is called the current ratio。 It's current assets over current liabilities。

And basically what this is trying to get at is if current assets are going to turn into。

cash in the next year， current liabilities have to be paid in cash in the next year， do。

we have enough assets turning to cash to cover the liabilities that we have to meet in cash？

One drawback to this ratio is， as we know， not all current assets turning to cash。

Some of them are things like prepaid rent， which never turn into cash。 Some are inventory。

which take a longer time to turn into cash。

So there's another ratio called the quick ratio， which is just cash plus receivables divided。

by current liabilities。 Much more conservative ratio。

saying do you have enough assets that are either cash or。

going to turn into cash very quickly to cover your current liabilities。

One more ratio is cash flow from operations to current liabilities。

So we divide cash from operations by average current liabilities。

This is more backward looking。

It's saying over the past year， did you have enough cash generated from operations to cover。

your average level of current liabilities？ So here's what the ratios look like for Plainview。

So why don't I put up the pause sign and you can take a look at them。

Okay I guess there are no insights or questions from the virtual students， so I'll go on myself。

Starting with the current ratio it looks very healthy。 It's trended upwards from 2。4 to 3。6。

So 3。6 means that Plainview has 3。5 times as much current assets as it does current liabilities。

Now as we talked about a problem with this measure is that inventory and prepades are。

not necessarily going to turn into cash。

So we have the quick ratio， which is cash plus accounts receivable over current liabilities。

That also looks good。 It's been trending upward and it's now actually over one。

When we look at the cash flow to current liabilities ratio， it's not quite as strong。

We see the volatility and cash flow that we've seen earlier in our ratio analysis and this。

is trending down。 But overall I think we can say that Plainview's short-term liquidity position looks pretty。

strong。 They seem to have enough cash that's going to come in to cover the payments they need。

to make out。 Next we're going to look at the interest coverage ratios。

Here the question is does the company have enough cash coming in from operations to cover。

its interest obligations。 And again ideally these ratios would all be over one。

The first ratio is the interest coverage ratio， which is operating income before depreciation。

divided by interest expense。 So this is a picture of interest coverage from an accrual accounting perspective。

So if we look at the sales revenue， we take out cost to get sold， we take out SG&A and。

then we ignore depreciation since that's not ever going to be a cash flow。

Is that operating income enough to cover what we have an interest expense？

We also have a purely cash based measure。

So cash interest coverage is cash from operations plus cash interest paid plus cash taxes。

What we're doing there is those are subtracted from cash from operations but we want to add。

them back to get pure cash from operating the business。

The question is is that cash from operating the business enough to cover the cash interest。

paid。

So here are the interest coverage ratios for Plainview。

I will put up the pause sign and you can take a look。

Hmm。 Nothing again from the virtual students。 Why don't we go and check on them？

Hmm。 What does that say？ Dear professor， sorry we are studying for the exam。 See you next video。

Your students。 Okay。 I guess I have been going on too long about ratio analysis and I do realize you've got。

an exam to do。 So just give me a few more minutes and I'll wrap this up。 Okay。

So let me go through the interest coverage ratios。

The interest coverage ratio looks really strong。

There's an upward trend and now it's 6。9 which means that Plainview's operating income。

before depreciation is almost seven times as much as its interest expense。

When we look at the cash interest coverage it also looks strong except for that one year。

where there was the negative cash from operations。

So the current ratios 3。8 which means that Plainview's operations is generating 3。8 times。

as much cash as they need to cover their cash interest costs。

So it looks like in general Plainview's in a good position in terms of generating cash。

to cover its interest obligations。

Now we're going to look at long term liquidity ratios。

These ratios are going to tell us something about how the company is financing its growth。

as well as provide a measure of bankruptcy risk。

The idea is the higher the company's leverage， the bigger the risk that it may have to default。

on its debt payments and then the company gets forced into bankruptcy hurting the equity。

investors。 First ratio is debt to equity which is just total liabilities over shareholders' equity。

So for each dollar of investment by shareholders how many dollars of liabilities has the company。

taken on。 Sometimes we put total assets in the denominator and we'll especially do that if shareholders'。

equity is really small because that could distort this ratio。

The next ratio specifically looks at long term borrowing。

So it's long term debt to equity， total long term debt divided by total shareholders' equity。

And this is getting at how the company is financing its long term growth。

Is it using equity or is it using long term borrowing？

And the final ratio is a little tweak on that。

It's long term debt to tangible assets so total long term debt divided by total assets。

minus intangible assets。 Intangible assets are things like contractual rights。

They're not physical assets。 They're not property plant equipment。

So essentially we're trying to get a measure of things like property plant equipment， accounts。

receivable， inventory and we're trying to get a measure of that because those are the。

kind of assets that can be collateralized。

In other words you can borrow the money with those assets as collateral whereas intangible。

assets are harder to collateralize。 So it's the borrowing capacity that the company has based on its collateralizable assets if。

collateralizable is the word。 So here are the long term debt ratios for plainview。

Let me go ahead and put up the pause sign and you can take a look。

Let's take a look at these long term debt ratios for plainview。

In this case lower ratios are generally better than higher ratios because they would indicate。

less risk， more borrowing capacity to fund growth。

So plainview's debt to equity has risen over this period but it's still only 1。05 which。

means that for every dollar of equity investment， plainview has about a dollar in liabilities。

which is a fairly low leverage ratio。

If we look specifically at long term debt to equity we see that this went up for a little。

bit probably as they were expanding and building the new factories and then it has come back。

down and is less than one。 Similarly for long term debt to tangible assets the ratio went up a little bit。

came back down。

These are still pretty low ratios indicating that plainview has a lot of debt capacity。

that they could use to borrow more money to fund further growth。

So the conclusion for plainview from liquidity ratios is that they're in a strong short term。

cash position。 Quick ratio is greater than one。

They generally have high interest coverage ratios。

They've managed their long term leverage wealth through their expansion and growth。

There's been some small increases in debt to equity and long term debt to tangible asset。

ratios but they're still not that big and if we compare them to other companies in the。

industry we would see that they're probably in line with what other companies have。

So liquidity is not a major concern for plainview technology。

And that's a wrap for the plainview technology case。

We have looked at all of the major ratios that people tend to use and so hopefully you can。

now add these tools to your toolbox when you're analyzing financial statements。

I'll see you next time。 [ Silence ]。

沃顿商学院《商务基础》｜Business Foundations Specialization｜（中英字幕） - P76：28_4 5 3M公司财务比率.zh_en - GPT中英字幕课程资源 - BV1R34y1c74c

Hello and Professor Brian Buchay。 Welcome back。 In this video。

we're going to do a ratio analysis on the 3M company， the company whose。

financial statements we've been following along with this entire course。 Let's get started。

So here we are at 3M's financial statements。 So there's a couple ways we could do the ratios。

We could take all the numbers in the income statement and in the balance sheet that we。

need and also from the cash flow statement， put them in a spreadsheet or put them in our。

calculator and calculate the ratios。 A second way we could do it is try to look the ratios up on the internet。

Why don't we do the second？ Before we jump on the internet to pull some ratios， a quick warning。

There's a lot of bad stuff on the internet。 Hopefully you aren't thinking that this course is one of those bad things。

But the problem with ratios provided on the internet is oftentimes the provider does。

not give you the definitions。 You don't know how they're calculating the ratios。

So my advice is find one source that you trust so they seem to use the same ratios that。

you would get doing it by hand and then always use that source so at least the ratios will。

always have consistent definitions。 So one of the best sources on the web that I found to get ratios is Morningstar because。

they give you a long time series of ratios that you can use。

So if we look at 3M companies page， there's some summary financial information and then。

key ratios。 So we've got right here return on equity。

So that's our starting point in the new pond formula。

You notice it's sort of been going down the last few years slightly。 We can look at the components。

Here's financial leverage going down so they're becoming less levered over time。

Turn on assets up and then down again so a little bit more volatility with return on， assets。

Then you can look at return on assets going into asset turnover and what they call net。

margin percentage is what I call return on sales。 It's the profitability and you can see the profitability up and then sort of down again。

which is tracking what we saw with ROA and asset turnover has been up and down as well。

But what we really need is to find three or four of 3M's closest competitors and then。

compare these ratios to the competitors to see whether these trends are specific to 3M。

or whether there's some kind of industry effect that's going on。

But based on my knowledge of the industry， these are still pretty healthy ROA and ROA， numbers。

And then above we have the profit margin breakdown so we have gross margin which is really high。

almost 50% SG&A to sales which has been fairly flat and operating margin。

You also get R&D to sales since it is a company that does R&D。

So we get to see the profitability margin ratios as well。

In case you're wondering the TTM column on the far right that stands for trailing 12。

months so that's the last 12 months before the date of the ratio calculation。

Then there's a tab for some growth percentages so this is just year on year 3 or average。

5 year average， 10 year average growth in revenue， operating income， net income， earnings。

per share。 Similar numbers for growth in cash flow。

In the financial health this is essentially the common size balance sheet for 3M。

And then down below we have our old friends the quick and current ratio。 3M is in really good shape。

current ratio above 2， quick ratio above 1。3， 1。4。

Financial leverage which we saw earlier and then a more traditional debt to equity ratio。

looks like 3M is not a very risky company not very highly levered。 Then there's efficiency ratios。

So here we have day sales outstanding， days inventory and days payable。

So we can see there's a slight downward trend in 3M's day sales outstanding。

Their receivables or inventory turnover has been sort of steady between 75 to 85 days。

and the payables ratio is similar。 What they call a cash conversion cycle is what I was calling the net trade cycle。

So it's basically the number of days you'd have to borrow from a bank。

And then if you want to look at the ratios the other way they have receivables turnover。

inventory， turnover fixed asset turnover and asset turnover。

And then one more thing to show you is Morningstar has a extensive glossary。

So if you don't know what any of these terms are like one ratio we didn't talk about is。

return on invested capital that's net income divided by stockholders equity plus long term。

debt and capital leases short term debt and capital leases。

So basically it's like RWE except it also adds debt into the denominator。

So you could just pull the ratios from a source like this， pull them from three or four competitors。

and then do the comparisons and you don't have to use your own calculator or spreadsheet。

to calculate all these ratios。 And that's a wrap on our week long look at ratio analysis。

Now it's time for you to focus on the exam。 Good luck and I'll see you on the other side。

[BLANK_AUDIO]。

沃顿商学院《商务基础》｜Business Foundations Specialization｜（中英字幕） - P78：1_课程概述.zh_en - GPT中英字幕课程资源 - BV1R34y1c74c

So， welcome to Managing Human and Social Capital。

This is part of the Management and Leadership course。 Welcome to this program。

My name is Mike Usaim。 I'm on the faculty here at the Wharton School and I'm with my colleague Peter Capelli。

Mike and I have both been here forever for a very long time teaching this course in particular。

to MBA students。 And there's a long history of this topic at the Wharton School which isn't particularly。

well known。 Begins back in about 1915 with the rise of scientific management in Frederick Taylor。

who was a lecturer here at Wharton School。 Elton Mayo was actually on the faculty here and created the human relations movement which。

recognized that kind of people mattered。 And in the 1980s the Tabestock Institute was here which was an institution that was。

devoted to the idea that how you structured work and the relationships between people。

at work affected the performance as well。 And here's why we've got this in this topic of human and social capital in the broader。

context of a course on management and leadership。 Got to know where we're going。

Let's call that strategy。 We got to get there and to get there we need a whole bunch of factors falling into place。

including the right people who are incentivized to get the job done， understand where we're， going。

And of course part of this course as well is thinking about doing that across boundaries。

And to put another sort of theme in front of us here in Peter's view and my view， he really。

got to get this people factor right。 And to get it right it means how we manage people， how we hire。

how we promote， how we， reward。 All that has to be aligned with the other functions that any manager has to be concerned。

about from finance and accounting to marketing and operations。

On top of that we've got to get all these pieces together and aligned in the same direction。

So another reason to think about this as being important is this is where all the money is。

So if you look in a typical business two thirds of the costs I'll go to labor。

It's also where all the discretion is particularly discretionary effort。

So employees who are really bad will completely sink an organization。 It's not just fraud。

Sometimes it's actually internal vandalism。 And employees who are really committed and will work hard make organizations succeed。

even when a lot of other things are going wrong。 So it is the key factor for differentiating what makes organizations succeed and fail。

In fact Peter， a colleague of ours at another institution wrote a book a couple years ago。

with the great title of people as the ultimate competitive advantage。 Gotta have a strategy。

gotta make a sustainable advantage with that。 But people separately manage for better or for worse do make a difference。

Peter I think to reference how we're gonna approach these topics。

Let's take a brief dive into Walmart and my personal guess is most listeners and most。

viewers have walked into at least one Walmart store and just to review a couple facts about。

Walmart， it's an amazing organization， it goes back to 1962， today it's got over 11，000 stores。

The market value， today's stock price times the number of shares out there is over $200， billion。

The sales now this past year， very close to $500 billion。

And in particular for our purposes what's notable is that Walmart with over 2 million。

employees is unequivocally the world's largest employer。

You know also one of the most important companies in the United States， something like one。

in five pieces of clothing are sold through Walmart。

They have a huge impact on the supply chain and have pioneered a lot of work in supply， chains。

So one of the reasons for thinking about them is they have as we say a big footprint， right？

I mean no matter what they do it has a lot of effect on a lot of people and a lot of。

other businesses。 And since we know a lot about it。

since most of us have walked into at least one store and， many people more than that。

let's take a look at actually two companies here。 We have Walmart in the center column and Costco on the right hand side。

And my guess is again many people have been into a Costco warehouse along the way。

And as we look at some numbers there， for example the annual turnover， the quit rate。

a close to 50% in Walmart below one in five at Costco， both are very successful。

Costco of course much smaller than Walmart。 But Peter at the point I like to make right here is that when it comes to managing people。

there are many ways to skin a cat。 There are good practices。

In many areas though there's not a single best practice。 And this course。

this piece of this course is going to be looking for some of the better。

practices on people management。 So I think the other reason for thinking about these two is something we didn't mention yet。

And that is managing people matters a lot because it affects the lives of the people。

So it's not just about whether organizations are going to make more money， it's what happens。

to the people who work there。 And this particular comparison of Costco and Walmart。

if you're outside the US you may， not have seen a Costco。

they're a big warehouse type retailer but they sell the same sort。

of stuff generally as Walmart sells。 The fact is that they choose different directions matters a lot。

maybe to the way the companies， compete but also to the employees。

So Walmart has received a fair amount of criticism， partly because it is so big for not paying。

their employees more and high turnover， etc。 And Costco is often thought to be the kind of opposite model。

You can see here the differences in the rates of pay that employees at Costco stay longer。

pay a whole lot more money， get employee benefits， more benefits， all those sorts of things。

So the point here is partly there are things that we know that absolutely work。

There are some best practices but there are also choices among best practices based in。

part on what you want your business to do， how do you want it to compete in the product， market。

And that is， as Mike was saying before， the fact that these things have to line up。 Peter。

why don't we break our itinerary that we are going to get in there to pursue more。

generally not just with Walmart and Costco but with a number of enterprises。

Let's divide it around four issues and we see those on a slide here in front of us。

The first being how do we motivate people to come to work and get the job done？ How do we pay them？

How do we promote them？ And let me just throw that as actually a question to you。

Do you see the Walmart or Costco for that matter or any company really？

What does it take just in general to get people to perform individually when it comes to a。

reward system， a pay for performance kind of deal？

You know I think this is a really important issue around the topic of managing people。

because it reflects some fundamental underpinnings that are important。

Most people understand the idea of incentives。 In the back of their mind as John Maynard Keynes said a lot of people are actually the slaves。

of who think they are being practical， the slaves of dead philosophers， dead thinkers。

They got in the back of their mind a model of human behavior which is a pretty simple， model。

People are completely rational， they are incentivized by money。

We know from the field of psychology that a lot of that is not true and a lot of other。

things matter besides simply money and if you want to be good at managing people you have。

to understand that。 So this is a point where it is often hard for some people to get their hands around if you。

haven't had a lot of psychology classes before。 A lot of people interested in business know a lot about finance and accounting。

They think that way but to get good at managing the people's part and thinking particularly。

about these issues of how we motivate people we have to understand how people actually behave。

They are not widgets， they are not pieces of machinery and they respond in slightly quirky。

ways and to design the right reward and incentive systems and to motivate people you have to。

have some pretty good understanding of the you might think of it as the quirkiness or。

the fundamental attributes of humans。 And Peter have often heard a phrase applied to reward systems and that is for any organization。

it's a bit of a long march。 We put out their assistance to pay for people for getting the job done。

It turns out because people are not completely predictable。

We incentivize here and something untoward happens over here so we revise。

And I think it's one way to think about reward systems is to think about we got to have something。

out there but what we have may not be fully effective completely aligning people in the。

right direction and of course people change over time as well。

And very nice analogy to China there Mike with the long march and the Chairman Mao's， long march。

Mike and I have been working on a book about China and addressing some of these questions。

in China as well。 And by the way just a brief reference on that the world's largest employer unequivocally。

is Walmart the second largest employer is a company whose popular name is Foxconn which。

is technically based in Taiwan but it has over a million employees。 Walmart is a 2。

2 million but Foxconn has a million 1。1 million people working for it in。

China today making our iPhones for example。 So anyway these are big enterprises they've thought a lot about how to get the reward system。

Right so Peter let me go on to number two briefly here once we've got it kind of figured。

out at least for the moment how to hire people how to reward them for their individual job， done。

I think it's also true that the nature of the work can again add additional motivating。

force or rather discouraging unforce if it's not done right。

So I think you know this is one of these topics where many people believe you just do it。

I mean jobs just sort of somehow fall out in terms of what it is that people do。

There is actually a lot of choices involved in this a lot of decisions and some of them。

are objectively better than others in terms of how they motivate people right。

The way you design a job what you actually have people do down at the level of the particular。

task whether they have to make decisions themselves or example or whether there's a supervisor。

standing over them。 These are choices and they affect human behavior。

There are some best practices here but there again are also some choices that might fit into。

different kinds of organizations depending what you want them to do。

You don't want somebody running a nuclear power plant for example to have an awful lot。

of discretion as to how they run things but somebody who's out in the field dealing with。

a customer you probably do。 Peter let's just take some of those ideas and think for a moment about how you would apply。

them if you are the manager of a Walmart store。 We've got a lot of people coming into work at 9 o'clock in the morning。

He wants them to serve customers to restock shelves to do an efficient checkout and just。

thinking very briefly since the compensation the wages of Walmart employees not terribly， high。

What are some of the job let's call a job design factors that might help people really。

want to do a better job on the work say on the floor of a Walmart。

And for those of you who are wondering what it's like to be in business school this is。

what's known as a cold call in business school and that means you're asking a question you。

weren't expecting to answer but I think there's a pretty clear answer to that right and if。

you are an employee and you're not doing it for the money so much because at a place like。

Walmart you're paid by the hour you're going to get paid whether you do the job or not。

Do you feel accountable for this do you feel that you are the person who are responsible。

for this particular part of the store if for example people have a bad experience there。

there's nothing on the shelves are you the person who gets pointed to for not doing a。

good job with that do you have control over it。 So there are decisions you can make that make people feel independent of the money independent。

of a boss coming around telling them to do it that they want to do these things。

Now there's some other size of that too right they may do it in their own way which isn't。

perfectly the same as what somebody in another department might do and that's something you。

got to worry about as well。 So that's where we're going with the topic number one and then topic number two number。

one being motivating individual performance number two working through job and work designs。

that lead to high performance。 Our third topic going to come back to in a little bit is helping people at Walmart at。

a store maybe nationally or anywhere make good and timely decisions and we stress the。

and between good and timely we can make a snap decision we can shoot from the hip that's。

timely but not very good or we can wait a long time to get it to be perfect but as we。

know the phrase goes perfect is the enemy of timeliness so we want good and timely decisions。

and to think about that in the context of Walmart an amazing statistic at least for。

me is that some 70% of Walmart Walmart store items are up at the cash register with money。

coming in from a customer before the company the headquarters is actually even paid the。

supplier of them and of course that means they they they're seeing a lot of money coming。

in without having to put a lot of money out long in advance of a sale and I guess I'll。

turn the cold call on myself in this case and that is if I'm a Walmart and then add to。

it Peter if I'm a Walmart store manager what do I want around me or maybe below me to be。

able to make good and timely decisions and just to anticipate where we're going to go。

with that I would say two factors are pretty important one is I as a store manager I have。

to unequivocally understand what the metrics of the performance are going to be what the。

intent of Walmart the parent is sending in my direction and then I don't want to be told。

how to do it it's got to be within the law by within the ethical principles of the firm。

but you've got to give me coming from headquarters now a lot of discretion to get that job done。

if I've got that I can make good and timely decisions you know what are the things that。

we've learned at stores like Walmart is that one of the key issues which really can only。

be solved by the employees right up there at front is do they keep the shelves stocked。

yeah right because we know when customers go by and they don't see what they want they。

just leave they don't buy it right and figuring out how to keep those shelves stocked is something。

that you can't really do by computer and algorithm at least not yet somebody's got to。

walk by and see we're out of this if they have to go file a report which then goes to。

somebody else by the time they get around to doing it it's too late the customers are。

all gone so figuring out how to get employees incentivized to make those kinds of decisions。

on their own is part of that story as well right so Peter good illustration thus of our。

third topic and that is bringing that issue of good and how many decisions down to the。

floor of the place we work there are a number of very specific ideas that we're actually。

going to be going through as part of this course so stay tuned on that as well a fourth。

and final topic very important equally important is to then put all the people all the functions。

all the floors based together in a broader we tend to call it an architecture or organizational。

design to get more academic on that and we also have to be good at changing that organizational。

scheme as customers change as products change that are coming into the store so our fourth。

and final topic here is designing and changing an organization's architecture and just by。

way of brief illustration here again thinking about it safe from the standpoint of a store。

and the store manager a local location I think while the people who are in the financial。

side of the operation here at the store let's say outside of Philadelphia were relocated。

they report up to the chief financial officer for the headquarters down in Arkansas yes。

that's true but I also want as part of the architecture I want a direct line that goes。

from me to them so when it comes to hiring to promoting them evaluating their work as part。

of the architecture I want that person not only to report to the chief financial officer。

for the firm as a whole but also to come by my office and let's have a very tangible。

discussion which I can influence as Mike's describing a matrix system of management if。

you've heard about that we're going to talk about those sorts of systems as well how do。

you organize the chart some people might say it's also important on these to recognize that。

organizing the chart the formal structures are also not the only thing that matters so。

you probably if you've worked for a while in an organization know that they have come。

in and changed reporting arrangements and yet you notice things still work the same way。

they've always worked and one of the reasons for that is because organization culture which。

is something we'll talk about I think organization culture which are the norms and values that。

tell people how to behave have a lot of force in some cases even independent of what the。

official and formal rules are and the reporting arrangements so organization architecture the。

structure really matters pretty easy for people at the top to change it as well but we。

also don't want to overplay it there's a bunch of other things that affect how organizations。

behave so a quick recap as we go forward this is on managing people at work human and social。

capital got these four topics motivating individual performance designing jobs that people actually。

want to perform when they come to work how do we help people make good decisions that。

are timely and finally how do we put all this together with a kind of a cultural mindset。

and an architecture to bring more than a few people together to get the job done on behalf。

of whatever it may be whether it's an organization a hospital a company you're running or maybe。

even a country so we're going to be doing a deep dive into these four topics we've got。

a lot of research a lot of examples so stay tuned stay with us and one more just final。

thought on this if you think about how this material fits into other topics you might know。

there are best practices here but it's not like accounting it's not like here are the。

ten things you have to do in this order it is a bit more like strategy in that sense and。

that their judgment calls there are best practices there are also also judgment calls。

that have to be made what you want your business to do determines in part how you're going to。

manage your employees what choices you're going to make about design about motivation。

all those sorts of things fit together so partly best practices but we're trying to。

teach I think also judgment about what to do where and why that makes sense and here's。

what's going to be the kind of vital summing up we're going to walk into companies like。

Walmart we're going to draw upon research I'm going to offer up examples ultimately though。

at the end of the day we want to put in your hands some ideas on what some of the again。

as Peter put it some of the judgment calls that are probably going to be better for the。

human and social capital that you want to draw most from so at the end of each of our。

sessions we're going to provide a call of a template five or maybe a few more ideas to。

hang on to not completely detailed and specific we want them to be guiding your judgment on。

how to take human and social capital forward。 Thank you。 [BLANK_AUDIO]。

沃顿商学院《商务基础》｜Business Foundations Specialization｜（中英字幕） - P79：2_简介.zh_en - GPT中英字幕课程资源 - BV1R34y1c74c

Hello folks， my name is Peter Capelli。

I'm a professor of management here at the Wharton School。 I've been here for a long time。

When I first got here， there was a Republican president in office and it wasn't a Bush。

So that gives you some sense of how long I've been here at the Wharton School。

We're going to talk about managing human capital in this program。

We're going to talk about a bunch of different parts of that that are fundamental， no matter。

where you are around the world。 These issues play out more or less the same way。

We're going to start out talking about motivation， how to get people to do the kinds of things。

organizations or employers need them to do， how to reward people as a part of that。

Hiring practices， how to do that the right way。 Managing performance and particularly the issue of performance appraisals。

We're going to talk about designing jobs， how to do a better job。

Training work that is meaningful and improves people's motivation。

And work systems that improve performance fit with the strategy of an organization and。

make everything better off。 So that's the list of topics we're going to work our way through。

We're going to start out with some thoughts about employment in general。

That is when you are hiring people。 How do we think about that？

The first thing to remember is we're talking about people here and particularly for folks。

who have more of a technical orientation or an economics orientation。

It's easy to think about factors of production and imagine that they're all kind of the same。

But they're not。 We're talking about employment。 We're talking about hiring and managing。

We're talking about people。 And the reason that's different just from a practical concern is that people have legal。

rights。 And in most countries of the world those rights include unionization。

the ability to bargain， with the employer。 And basically it means force the employer to do things the employees want。

And so the ability of management is not unlimited。

Depending where you are around the world those legal restrictions can be quite constraining。

The US has probably among the developed countries the most favorable legal environment for employers。

They can do more things the way they want to do them than they could in other countries。

But even in the US there are lots of constraints on what you can do。

Most of the constraints have to do with discrimination against protected groups。

In the US you see these legislation in the European Union， other countries as well。

Basically that means you can't discriminate against women minorities。 That means ethnic minorities。

religious groups， people because of their religious orientation。 And a lot of countries now age。

So that means in the US people over 40 different countries maybe a little higher。

What that means in practice is that you can't take employment actions， hiring pay promotions。

anything that affects people materially in ways that have a particular impact against。

those protected groups。 And depending on what country you're in the burden is on you to prove that you're not。

doing that。 If it turns out that most of the people laid off are women for example the burden on the。

employer is to show that that was done in a way that was fair and was not intended to。

be discriminatory and instead was based on something sort of objective。

So in addition to laws we have social norms that matter as well。

And those norms are really ones concerning questions of fairness。

And that means the leaders of businesses， the leaders of political leaders of government。

are held accountable to the way they treat their employees independent of whether they're。

violating the law。 So this is all by way of kind of a caveat to the things that we're going to talk about。

You don't have unlimited power as a manager， as an owner。 The way you manage your people。

the way you might with how you buy computers or how you。

assemble parts or something like that or deal with vendors。 Employees are not vendors usually。

they're not contractors， they got a bunch of different。

rights。 So bear that in mind when we start talking about the important issues around managing。

people。 [BLANK_AUDIO]。

沃顿商学院《商务基础》｜Business Foundations Specialization｜（中英字幕） - P8：7_从产品中心转向客户中心管理.zh_en - GPT中英字幕课程资源 - BV1R34y1c74c

Hi， I'm Pete Fader。

I'm the Payone Chaw Professor of Marketing at the Wharton School and Co-Director of the。

Wharton Customer Analytics Initiative and I'm really excited to be starting my module。

of our Introduction to Marketing course。 The fact that I run a research center called the Customer Analytics Initiative suggests。

that I'm a data guy and that's certainly true。 I love looking at data about customers。

trying to figure out which customer is doing what。

and for how long and for how much money and what kinds of tactics can companies use to。

create and extract even more value from the customers。

So for me it's all about the customer behavior， the patterns that we see over time and the。

kinds of strategies that companies can build around those patterns in order to do better。

for themselves。 So I want to start by going back to one of the frameworks that Barbara Kahn used in her。

modules。 You might recall this slide over here where she laid out the basic kinds of strategies。

that companies can follow。 And a couple of these strategies are really clear。

Everyone understands what performance superiority means。

It's just having the very best product out there。 So whether you're an Apple。

a BMW or a luxury product like Louis Vuitton or a Gucci， you， want to have the best。

Operational excellence is also pretty clear。 You want the lowest price。

you want the most efficient operation or the most efficient， experience for your customer。

So whether you're talking about a Walmart or an IKEA or a Zara， you're really interested。

in keeping the cost low， keeping the process very efficient。 That gives us operational excellence。

But it's the third leg of this diagram that we're going to spend a lot of time on。

It's the idea of customer intimacy。 And basic idea makes sense。 Let's focus on the customer。

But exactly what does that mean？ Who is the customer？

Are we going to focus on all customers the same way？ Just how intimate do we want to get？

And how do we actually make more money on something that actually adds costs than some。

of these other strategies？ So that's going to be the main focus of our efforts。

It's taking this idea of customer intimacy or， as I like to call it， customer centricity。

and really understanding what it is， clarifying what it isn't， motivating why it's important。

and trying to get firms to make a well-informed decision about whether they want to pursue。

that kind of strategy and whether， when， and how to actually go after it。

So that's going to be the focus of our work。 I'm here on South Street。

one of the popular shopping areas in Philadelphia， and all around。

me would be stores that represent the different kinds of strategies that Barbara spoke about。

Just over my right shoulder， you'll see one of my favorite pizza places。

That's performance superiority。 Right down the block， there's a number of fast food restaurants。

That would be operational excellence。 But what about customer intimacy？

What kinds of stores would really be customer intimate or customer centric， as I like to， say。

and what makes them different？ So let's really understand how these different strategies compare with each other and then。

take the deeper plunge into customer centricity。 So give me a few minutes to review the traditional steps of running a business。

Running a business in a performance superior or an operationally excellent kind of way。

And that's going to give us the basic foundation so that we can really understand how customer。

centricity is different， some of the challenges associated with it， and some of the opportunities。

that customer centricity can provide that you might not be able to achieve with a performance。

superiority or an operational excellence strategy。

So let's take a step back and review these traditional steps of running a business。

For most commercial enterprises， the overall objective， beyond everything else， beyond all。

the tactics that a company is using and the strategy that it's hoping to follow， it's。

all about making money。 And again， Barbara reviewed this and you don't need to be told this。

It's all about maximizing the value of the whole corporation。

It's looking at the money that we make today， the money that we'll make tomorrow， the money。

that we'll make 10 years from now。 And when we recognize the time value of that money that today's dollars are more important。

to us than tomorrow's dollars， when we take the discounted flow of the company's profits。

that in theory gives us the overall value of the corporation。

So it's our job as a manager to maximize the value of the corporation， which means maximizing。

the net present value of profits that the company is bringing in。 So we agree on that。

That part is pretty easy conceptually， but the question is how do companies achieve it？

And that takes us back to those core strategies that Barbara laid out。

And when you think about the most traditional among them， again， performance superiority。

and operational excellence， it's all about coming up with a blockbuster product or service。

coming up with a brilliant idea that puts a step ahead of all of our competition and。

figure out ways to bring that idea， that product or service to market。 So it's conceptualizing it。

it's developing it， it's manufacturing， distributing， marketing， that idea。

That's what business is traditionally all about。 And so the key for most firms to making money isn't only coming up with that idea。

but then， figuring out ways to produce lots and lots of it。

And one of the things that we discovered over the years is that producing lots and lots。

of quantities of this product or service that we want to deliver not only helps us make。

greater revenue， but the fact that we're producing and distributing so much of it also。

brings our costs down。 So the core focus of most traditional businesses is high volume low cost。

And again， coming up with a great idea that enables us to do that。

So so many companies have built their business around that。 And even today。

a common question that we always ask ourselves， particularly when we， have a new business is。

will it scale？ Can we produce or deliver this product or service at scale so we can do so much of it。

that's going to let us bring in the revenue and bring our costs down。

So that's the basic way that most companies operate。 And over the years。

many different metrics have arisen that help companies understand， how well they're doing it。

Obviously， they can look at the volumes that they're delivering。 Obviously。

they can look at changes in their costs。 Our costs coming down as we develop and deliver more and more of this product or service。

So some metrics that show us how well we're doing our business are fairly clear。

Some of them are less clear。 For instance， a very powerful metric is market share。

So many companies today obsess over market share because not only does it give them an。

indication of how well they're doing relative to their competitors in a given industry， but。

it also has these interesting properties of being a leading indicator of how well you。

will be doing。 There's a lot of research that goes back to the 1960s and 1970s that shows that market。

share is not only a good backwards indicator of how well you've done， but a leading indicator。

of how well you will likely be doing in the future。

So many other metrics like market share and others are central to this product superiority。

or operationally excellent strategy。 Beyond running your business and measuring to see how well you're doing it。

a company， isn't only interested in fine-tuning those metrics。 They're interested in， in fact。

they're mandated to have growth。 It's not enough just to do what you're doing a little bit more efficiently and effectively。

More shareholders demand growth。 They want more。 They want more than you could possibly have delivered before。

So where does growth come from in a world characterized by performance superiority or。

operational excellence？ What are the sources of major growth that a company can enjoy？

And we really see two different sources that at first sound fairly distinct from each other。

But when we think about it a little bit more carefully， there are actually just different。

flavors of the same kind of growth。 So let's think about them a little bit。

One source of growth is taking the products of services that we've been delivering already。

and bringing them to new customers， either going to new customer segments or to new geographies。

So it's taking this great product of service and bringing it to new customers。

That's clearly a source of growth。 The other source of growth that I'm sure all of you could think about would be innovation。

So in addition to producing and distributing a certain set of products of service， what。

more can we do？ So let's go back to the folks who developed these great products of services in the beginning。

and say， give us some new products of services。 Let's go back to the R&D people and say， okay。

you have a certain degree of expertise that， has enabled you to bring us the current product。

What more can you do to bring us either variants of that product or entirely new ones that haven't。

existed before？ So an obvious source of growth would be new products or extensions to existing products。

So at first， this idea of taking our current product and bringing it to new customers or。

coming up with new and different products seem fairly different from each other。 And indeed。

the tactics associated with them， the expertise within the corporation does。

have to be a bit different。 When we step back and think strategically。

both of them actually have a lot in common。 Other than share this basic idea。

we have a certain degree of product expertise。 How can we extend it？

How can we take that product expertise and either extend it to new customers or extend。

it to new products？ So regardless of the specific way that you go after growth。

the main source of growth， is extending our overall product or service delivery。

And that's what most companies have to be really good at。

We're good at doing a certain kind of thing。 We're going to try to do it as efficiently or effectively as possible。

Now how can we take that product expertise and extend it in new directions？

And how do companies go about doing that？ How do they go about running the existing business as well as figuring out how to extend。

the product？ Well， if you look at the organizational chart of almost any company on the planet。

the company， tends to be organized around the different kinds of products and services that it delivers。

So you'll have a product manager or a brand manager。

But it's all about having separate silos around the different products or services and then。

organizing all the activities that way。 And so very often。

each of these different silos will be responsible not only to run its。

own operation as efficiently as possible， but thinking about its own way of extending that。

kind of product expertise。 And so if we sum up the way that most companies operate。

it's all about this idea of product， or service expertise。

That's the competitive advantage that so many managers， so many academics， so many industry。

experts have focused on for so many years。 We are the best at conceptualizing， developing。

delivering a certain kind of product or service， and we're going to stay ahead of our competitors by becoming more efficient。

by going to new， markets and always developing new product or services that are going to keep us a step。

ahead， product expertise。 So what I've just described to you is pretty standard stuff。

For most of you， if you look at your experience as a consumer or through your work experience。

you'll realize that that's the way that most businesses operate。

And instead of just calling it business， we can now put a label on that。

And that label I like to use is product centricity。 See， in the old days。

we didn't need a special label for it because for most companies， this。

was business and business was this set of steps that I just described to you。 But today。

we're seeing different kinds of business models emerging。

And so we want to now distinguish the set of practices that I just described。 In fact。

I like to use a metaphor about a fish swimming around in water。 So while a fish is in the water。

it doesn't realize that it's in water until it jumps， into a new environment。

It jumps out of the water for a moment and realizes， "Uh-oh， I'm in a different environment， now。"。

And I kind of like the old environment better。 I'm going to stay in the water。

And this is exactly the kind of issue that many companies are facing today。

They're swimming around in their own water of product centricity。 It works。

It keeps the business going。 It gives them some opportunities for growth。 And for many companies。

that's totally fine。 But for other companies， whether it's out of desperation or perhaps opportunity。

they're， looking for different kinds of environments。

They're looking for different kinds of strategies。

We're seeing more and more companies jumping out of the water and saying， "Is it better， out here？

How can I operate out here？ Should I operate out here？"。

And that's why we're now going to put a specific label on the old way of doing things， product。

centricity。 So again， most of you understand that。 This is business as usual。

Many of the concepts that Barbara was talking about implicitly referred to a product centric。

approach and just to sum up the product centric world before we kind of start moving away， from it。

I have this one other slide for you here that shows you many of the classic characteristics。

of a product centric business。 And if you look up and down the slide。

you won't find a lot that's tremendously insightful。

And that's the point I want to make is that the traditional product centric approach to， business。

Again， focusing on performance superiority or operational excellence is by now second。

nature to most managers。 So if you look at， as the slide shows。

the kinds of customers that we're going after， the kinds of metrics that we're using。

the overall focus and the organization of the business， it's pretty standard stuff。

I just want to call your attention to this one point towards the bottom of the slide。

the idea of the mental process。 And I love this idea of divergent thinking。

And it goes back to an idea I mentioned a few minutes ago。 We have this product expertise。

What can we do with it？ How can we spread it out to other kinds of customers and other kinds of businesses？

Again， implicitly， that's the way that most businesses operate。

And we hire people who can think divergently， who can take our particular core business。

and think about ways of spreading it out to new markets and new products and services。

So I want to make that explicit because as we go on， we're going to talk about some very。

different mental processes as well as different metrics。

And all of the points that you see on this slide are going to become quite different。

[MUSIC]。

沃顿商学院《商务基础》｜Business Foundations Specialization｜（中英字幕） - P80：3_动机.zh_en - GPT中英字幕课程资源 - BV1R34y1c74c

How do you get the people who are working for you to do anything？

Now， it may seem like it's pretty simple。

You just hire people and tell them what to do unless you've ever been an employee， of。

course。 And then you realize that sometimes the employees don't want to do what you want them to do。

And sometimes that's for principal reasons。 And sometimes it's because they're having a bad day or they're tired or whatever。

And the question is going to be how do you get employees to do what you want them to， do？

And I wanted to illustrate with a story that I saw myself in New Orleans in a restaurant。

many years ago now called Mothers。 And in that restaurant I was there sort of a cafeteria line。

great food。 And the electricity went off in the restaurant， but they kept going。

which was cool and admirable。 But at the end of the food line you get to the point where they total up your bill and。

they take your money and give you change。 So there was somebody there with a calculator totaling up your bill。

And there was somebody there at the cash register。

The cash register doesn't work because the electricity is off。 Calculators got batteries。

The cash register doesn't， so the cash register is not working。 Cash registers are a control device。

right？ You put in what the food was。 It says how much it was。

At the end of the day you total that number up and it better correspond with the amount。

of cash in the drawer or if it's less than that somebody's probably stealing or made a。

mistake or something。 So we get to the cash register， right？ And it's open。

And there's somebody there who's taking your money and giving you change， but they're just。

doing it with an open box of cash， right？ Behind that person is another person who is standing there just looking over the shoulder。

of the person who is taking your money and giving you change。 Now what is that person doing？ Well。

that person is just watching the person with the open cash drawer and probably， I'm。

assuming I didn't ask them， the reason is because they want to make sure the person in。

front of the cash is not stealing cash。 But then you might wonder。

shouldn't there be a person standing behind the person who's。

watching the person with the open cash drawer to make sure that they're not in coheuts together？

Well you start thinking about this and you realize one of the problems of management。

you could try to manage people by having somebody stand over and watch them。

But that doesn't work very well。 First of all， it's really expensive to do。 Second。

how can you trust the person who's watching if you can't trust the first person？

So this is all around the question of motivation。 How do you motivate people to work in the way that you want them to work？

And that might include things like not stealing from you。 In general， you can think about it。

I think this way， I always think about this test。 If your employees are doing the right thing for you。

we talk sometimes also about questions， of engagement now。

a common phrase which means really commitment， are they looking after， your interest？

If it's five o'clock in your office and it's quitting time and it's hit five o'clock。

and the phone's ringing， do people go back and answer the phone or do they continue to。

walk out the door？ If they are committed to the organization。

if they're engaged and looking after your interests。

they might take the extra minute or so and answer the phone。 If not， they're probably out the door。

And as an employer， you want to make sure people will go back in and answer that phone。

You want to make sure that you can trust your employees with an open cash drawer and you。

don't need somebody standing behind them in order to figure out whether they're cheating， or not。

So we're going to talk about how to do that and also understand some of the companies。

that describe how they manage in completely different ways than the example of the restaurant。

I was giving you。 Companies that talk about， for example。

giving their employees 10 hours a week or so Google， I think was famous for this among others。

3M as well， to just work on stuff that the， employees want to work on。

Now they could be sitting on their hands as far as their supervisors probably know because。

you're giving people discretion and you're not supervising them。

You're giving them autonomy to go do what they want to do that's in the interest of the company。

So you really got to trust them。 What makes it possible to trust those people in those kind of companies when in lots of。

other companies you've got cameras watching people you got supervisors standing over them。

What's different in those two operations？ And we're going to talk about how you might make that happen as we go along in this course。

So let's start talking about the simplest model of management。

This is a model that is associated with economics people in economics call this an agency approach。

agency model。 The idea here is that you have an agent the employee is like an agent who's working for。

you and you are the principal that is you are the person who is trying to guide the agent。

Actually this is not the way employment works at all but it is a useful abstraction to think。

about how it works and we're get to the more complicated， more realistic ideas in just a， minute。

If you have an agent who is working for you how might you motivate that person to do the。

right thing and you don't want to stand over them and watch them。

In our course at the Wharton School we teach a case about a company called Automated Travel。

Systems which was started a while ago and created the software that drives search engines。

for finding flights now。 And in that company they had a particularly difficult moment where their software engineers。

were holding the company up。 I mean literally talk about a hold up company that's like you're sticking a gun at somebody。

And the gun they were sticking is we're going to quit unless you give us more money or stock。

options whatever it was。 And in this particular company that was happening the engineers were threatening to quit and。

the company was on a very short deadline it had investor money that wasn't in deep pockets。

of money and they had a deadline they had to get to in order to remain solvent and the。

engineers are holding them hostage and saying we're going to walk away and your project won't。

get done unless you give us more money。 Well this is a problem with this kind of basic model where it's all about money and we are。

can hold you up for more money because we don't really care about the mission of the company。

and we don't really care about our job we're just in it for the money。

And how you solve that problem basically is unfortunately going to be that you can't。

do it with simple contracts you're going to have to do other things as well and we'll。

come back to that in just a couple minutes。 But the basic idea about incentives is the solution to the agency problem as it usually。

describes you're trying to reward people for doing the right thing you want them to finish。

this project they get paid so much when they finish a project think about it almost like。

a contractor right now there's a couple of other ideas around this simple model one of。

them is something that economists call efficiency wages and the idea here is about kind of about。

relative competition that if you pay more than your competitors even if it's only a little。

bit more you will get better workers first of all because if they can choose where to。

go the best ones will come to you if you pay a little premium over everybody else。

The second factor is that those folks are less likely to quit because where they're going。

to go if your job is better than everybody else's and the third is they're likely to。

behave better because if they don't they might get fired and they lose a job which is。

better than everybody else's job。 So basically it's the advantages of having a job that on balance is better than the ones。

your competitors have got and there's pretty clear evidence on that I did one of these studies。

a while ago showing the discipline rates were actually lower at plants where companies were。

paying a little premium above the market rate。 Now you got to pay more for that but the idea is because you're paying a little better。

than everybody else you get lots of benefits。 Now the obvious question is what happens if everybody else starts paying more and then。

the benefits go away right so it's all about relative competition and the idea of a tournament。

as a way to structure pay is another kind of economics based argument that is about relative。

compensation and this mimics the way sports tournaments work。

So for example if you're a golfer or somebody playing an individual sport you'd know that。

if you win the tournament you get a big prize the people coming in second get something。

that's pretty good the third you get a little trophy and fourth place you get a carry on。

bag and that's about it as you work your way down the big prizes are for winning。

Now why is that a good thing because you could have many people playing in the tournament。

all motivated by that one prize and that makes it a very efficient way to do things。

Of course there are downsides to this as well and the downsides are that this works great。

in a tournament where nobody's going to work together and everybody's literally competing。

against each other but inside an organization where these tournament models are set up they're。

usually promotion systems so if you get promoted to partner you make a ton more than the people。

who are associates。 If you get promoted to the next level up in a company particularly to the CEO level you。

make a ton more money than the people just below you it motivates lots of people along。

the way but if you want people to cooperate and work together in a company or in a professional。

service firm it cuts against that it creates incentives for you to fight each other and。

it also creates incentives for you to join week tournaments that is you don't necessarily。

want to be in a tournament full of stars because it's going to be hard to win you want to be。

in a tournament with a lot of losers because then it's easier for you to win so it affects。

where people want to go as well plus is and minus is to efficiency wages plus is and minus。

is to tournaments。 [BLANK_AUDIO]。

沃顿商学院《商务基础》｜Business Foundations Specialization｜（中英字幕） - P81：4_代理理论的动机案例.zh_en - GPT中英字幕课程资源 - BV1R34y1c74c

But maybe the biggest problem associated with the economics-based incentive model of motivation。

the agency model， is that it's easy to get the incentives out of alignment。

And they could be out of alignment even a little bit and they caused a ton of problems。

So for example， it's a famous story which I learned from my colleague Mike Useem， where。

you're going to hear from a little later on this， about Australia， which began its civilization。

modern western civilization anyway， as a prison colony for England。

And at that time， you might have thought being sent to Australia from England， particularly。

in the winter， was a pretty good thing。 Why not be in Sydney where the weather's pleasant？

But it turned out the reason it was such a terrible thing to be sentenced to time in。

Australia was that a very large proportion， I think at one point a majority of people。

sent to Australia， died。 So even if you were sent there for a two or three-year sentence。

highly likely you might， die。 And the reason they were dying， a Royal Commission investigated。

is they were dying on the way， over。 And what were they dying of？ Dehydration， disease， exposure。

all things that were preventable。 The Royal Commission took a little look in this and they discovered that the English。

government was outsourcing the shipping of prisoners to Australia。 They weren't doing it themselves。

The private ship captains were taking the passengers over and the way they were paying。

the ship captains was so much per passenger。

So ten pounds or something for each passenger who they shipped to Australia。 Well。

if you were a profit maximizing ship captain who didn't have any scruples， the。

way you would make a lot of money is you would skimp on food， you would skimp on blankets， and heat。

you would skimp on water and actually if the prisoners died it was simpler for you。

because the boat didn't weigh as much， you'd just toss them overboard and you didn't have。

to feed them。 And that's what was happening。 So the Royal Commission set up an alternative compensation system which was very simple。

It just paid the ship captains for the number of prisoners who walked off the boat on their。

own power in Sydney Harbor and the death rate fell to maybe 2% from a majority to just a。

couple of percent。 So we talk about rewarding A while hoping for B。

That means the incentive system is hoping， let's say to get passengers。

prisoners to Australia in an efficient， inexpensive way。

That's B but what they're actually rewarding was simply piling people on the boat。

So it's unintended consequences。 I've got a contemporary story about this which is in a very different context。

It takes place in outer space and it takes place on the mere space station which was。

the Soviet era space station which turned out to be a pretty remarkable piece of engineering。

at least robustness wise。 It was in space for 20 years or so。

And there was a moment where the mere had an accident that was completely preventable。

We know the story about this because there was a US astronaut on board with the cosmonauts。

and he told the story afterwards。 Here's what happened on the mere。

It's a classic example of rewarding A while hoping for B。 What happened on the mere is。

that they were serviced every month by a spaceship that would be launched from Siberia， a little。

ship called the Progress。 They would launch it full of oxygen and food and water and whatever else they wanted pizza。

Ship it up and it would dock automatically with the mere。

They had this very elaborate computer and radar based system to pull it in and slowly dock。

But then as soon as it was done docking and they had unloaded it they filled it up with。

trash and they kicked it back into space and it would spiral down to earth and burn up。

in the process。 Now it worked pretty well except for the fact that it's incredibly expensive pizza delivery。

right because you're burning up one of those ships every time， every month when you're。

servicing the mere。 So the guys on the ground in Mission Control decided maybe there's a way to do this without。

quite as much expense。 Most expensive part or one of the most expensive parts of the Progress。

the ship that was coming， up was the avionics that is the system for docking the mere。

So what they decided to do was to see whether it was possible to launch the Progress and。

dock it without all that fancy avionics。 So they tried it out and they got it up there and then they turned off everything and they。

let the cosmonauts on the mere steer it into the mere。 Now the problem with doing this。

imagine parallel parking right。 Except in this case the curb is the mere space station and it's a bunch of pretty fragile。

stuff。 There's no bumpers around it right。 It's got antennas and solar panels and stuff like that。

The Progress is coming at you at 10，000 miles an hour and they got to slow it down you know。

it's hundreds of miles away and they got to slow it down enough to dock。

And if you bump you got a big problem right。 So the Progress is coming at them and they can't see it。

They can't find it。 They're looking out the window trying to see where it is and the radar image isn't clear。

and they got a camera on the Progress but it can't quite pick the mirror out because。

it's looking at Earth behind it and it's white and it's， I mean they can't see it。

And they finally get a glimpse of it and they try to slow it down enough but it couldn't。

slow it enough and it went zooming past them and it fortunately missed them。

But if it had hit him it would have been a huge disaster。

So the cosmonauts got on the phone and they called mission control and they said hey this。

is really really dangerous and it almost killed us we can't do this again。

What happened on the MIR space station was that the cosmonauts were paid a pretty big。

bonus for following orders。 So it wasn't for a successful mission it was for following orders that's what they were。

rewarded for that's what they were actually rewarding that was A while hoping for B in。

this case was a successful mission。 [BLANK_AUDIO]。

沃顿商学院《商务基础》｜Business Foundations Specialization｜（中英字幕） - P82：5_设计激励机制.zh_en - GPT中英字幕课程资源 - BV1R34y1c74c

more generally when we talk about incentive systems， there's a trade-off， right？ And the。

trade-off is going to be for employees。 Ideally， you want an incentive system to be based on。

some measure of outcome that is within my control。 So something about my job。 I do this， I get that。

right？ If you don't have that， there's really no incentive。 I can't control。

how much I'm going to get from you。 Then there's no incentive for me to do a good job。 I might。

do a good job anyway because I'm a good guy， but it's not because of the incentive。 And。

the problem in lots of jobs is it's very difficult to measure my output。

If I work at administration， for example， I work in a team or I work in some context where I'm interdependent with。

people or with idiosyncratic problems， it's very difficult to measure my individual output。

So another possibility would be to say， well， let's make the output something big like overall。

firm goal or overall organization performance。 The problem with that is it's beyond my ability。

to control that。 And the problem with doing that is that I don't feel any incentive。 So。

if you give me， for example， stock options and I work in a huge corporation， I've got。

almost zero input into what happens to the share prices。 So I don't really have any incentive。

There may be other reasons for me to have incentives。 It makes me feel part of the organization。

but it's not the incentive from those rewards that is making me perform a particular way。 Well。

how about having that organizational goal anyway？ Well， the other problem with。

having goals that are maybe within my control and are pretty， even if they're pretty far， up。

is that it's possible for me to do well at my goal at the expense of the overall business。

So for example， if I'm a salesperson and you say， we want you to sell more stuff， I could。

sell a lot of stuff by giving customers a really sweet deal， that's giving them low， prices。

I could sell a lot of stuff and drive my performance up and my incentive pay up。

So the problem with that is sub optimization。 I'm doing well at my goal， but it's at the。

expense of the overall business。 So it's another example of rewarding A while hoping for B。

So the best solution about most incentive-based pay is to not rely on it too much and to have。

incentives that are pretty simple。 So if you try to design an incentive system that heads。

off every incentive to cheat in every possible way somebody might go bad with this， you're。

going to have to have a rule book that people will have to look up to decide what to do。

at work all the time and you really don't want that。 Now。

the one exception we see for incentive-based pay is at the executive level for people whose。

individual jobs we believe drive the entire performance of the organization and you might。

be able to tie their pay to overall business outcomes in a way that wouldn't make sense。

for lower employees because they got no control really over the company's overall share price。

or overall performance， the agency's performance。 But even here you could get sub optimization。

We get executives for example whose incentive pay is based on relatively short-term performance。

and then there's a concern that they are driving up the short-term performance of the firm at。

the expense of longer-term performance where they're not going to be around。 So it's really。

hard to get away from these problems of incentives and so the idea that we can simply manage。

people by incentives is unfortunately just not true。

Now let's talk about more complicated models of management。 Are these are ones that are。

developed by psychologists？ So you might think about this as these are more realistic models。

of how people actually behave but it's much more complicated to understand all these different。

effects and to also think about how they might be bundled together in any given way of managing。

people。 So let's start with the psychologist take on the agency theory story of economists。

The incentive story。 We want somebody to behave a particular way。 Let's pay them if they achieve。

that。 Well the psychologist added a wrinkle to this which they call expectancy theory。

Psychologists have a way of calling whatever they do theory and so you'll hear that a lot。

through this program。 Expectancy theory basically means well what do I actually expect from the。

employer？ And that might be this if I have got this incentive base plan but I don't trust。

that if I actually get the performance that I will really get the reward then my motivation。

falls to zero。 So it's important to have predictability and trust in these models。

You can't just hand， somebody a contract and expect that that's going to make it work。

And if you believe that， something might happen change in ownership， change in goals。

change in compensation structure， then your motivation erodes。

Another complication created by a different set of psychologists。

this one particularly by our former Wharton colleague Bob House， is something called path。

goal theory。 And path goal theory says you could have all the incentives in the world and you could。

even have a clear goal for people that's unambiguous。 But if they don't know how to get there。

the incentives aren't going to do you any good。 So for example if you ask me to do something at。

work that's kind of complicated， solve some particular algorithm or something and here's the。

reward I get if I do it but I don't know how to do that kind of math， all the motivation in the。

world is not going to matter much。 So it reminds us of the importance of people having the skills。

having the training， understanding what to do。 It's not just about incentives。

The third issue which is where we depart from the economist's soul together begins with a series of。

what we might call cognitive models that have to do with the way your brain processes information。

And the simplest one of these is behavior modification。

An employer or supervisor let's say who goes。

around a retail store and sees somebody doing good stuff and gives them a spot bonus right there。

That's a kind of behavior modification technique。 I got a spot bonus for behaving this way。 I start。

to anticipate that maybe I will get more bonuses if I continue to act that way。 But the beauty。

of behavior modification is that you don't have to get those bonuses all the time。 In fact some of。

the strongest motivation， strongest learning about how to behave a particular way from this。

comes when you don't get them all the time， when you get them almost kind of randomly for doing。

the right thing。 And it teaches people to behave in a particular way which is unconscious。 It might。

look like incentives but the difference with incentives is you've got to know it's coming。

Somebody's got to tell you do this and you get the bonus。 With behavior modification you don't。

know it's coming and you don't know when you're going to get it。 And it causes you to learn in a。

different way which is not at the conscious level。 Let's talk about some other ways in which we can。

manage people to get them to perform the ways we want them to perform。 And these are also of that。

kind of cognitive variety。 These are associated with social psychology and that is how people behave。

in the context of other people。 And maybe the simplest one of these is the notion of conformity。

And that is particularly when there's uncertainty we look around to other people to see how we should。

behave。 Got a little video clip on this one as well。 So take a look at this and watch what you。

see the people doing in this video。 The gentleman in the elevator now is a candidate star。 These。

folks who are entering the man with a white shirt， the lady with a trench coat and subsequently one。

other member of our staff will face the rear。 And you'll see how this man in the trench coat。

tries to maintain his individuality。 But little by little。

He looks at his watch but he's really making an excuse for turning just a little bit more。

to the wall。 Now we'll try it once again。 Here's the candid subject。

Here comes the candid camera staff。

three of them at least。 And this man has apparently been in groups。 [Laughter]。

Here's a fella with his hat on in the elevator。 First he makes a full turn to the rear and Charlie。

closes the door。 A moment later we have opened the door。 Everybody's changed positions。

Now we'll see if we can use。 Now we'll see if we can use group pressure for some good。 Now。

in a moment on Charlie's single everybody turns forward。 They take off their hats。

And now do you think we can reverse the procedure watch？

And what you see here is as soon as the people in the subjects of this particular study see how。

other people are behaving。 One person two people gets much more persuasive。 Three people especially。

persuasive。 They conform to what that group is apparently doing。 Now how do you use this in the。

workplace？ When you hire people into an organization they don't know how it works。 They don't know。

what the rules are。 You put them in with a group of people who are your high performing people。

And they'll copy those people。 If you've got somebody who is not doing particularly well。

maybe for a little while you can put them into a group where everybody is doing the right thing。

and they start to conform to the norms of the group。 Two other ways in which something similar。

works。 One is imitation。 Imitation is different than conformity。 Think role models with imitation。

Right？ Somebody who has power over you like maybe a teacher and somebody who is attractive in various。

ways。 That is they are what you would hope to be。 Now we find ourselves copying those people。

That's， what we worry about role models for children especially athletes， actors。

people who are in the， public eye and are doing glamorous things because young people copy them。

Same thing happens in the， workplace。 If you've got a supervisor let's say got power over you but somebody who is attractive。

to you in various ways has what you would want and they're doing the right kind of things at work。

You're likely to copy that person。 That's good for the organization。 If you've got somebody who's。

attractive， has some power over you and they're not doing the right things， people are going to。

copy that person as well。 It's a bad thing。 And compliance is the idea that we really react to。

formal authority and the trappings of authority very powerfully。 The famous studies in this regard。

were done by Stanley Milgram in the 1950s showing how people will follow the orders of。

an authority figure in a medical context。 Somebody with a white lab coat and clipboard telling you。

in that case to provide electric shocks。 What they were told was a behavior modification study。

but it actually was a study in compliance to see how far people would go。 Shocking somebody simply。

because an authority figure told them to do it。 So we have a lot of power that is attributed to。

people who have authority over us and we tend to do what they say。 And so we need to pay attention。

to that as well。 We want our authority figures and organizations to be doing the right stuff because。

if they give people orders we tend to follow them。 And the last set of issues or theories or models。

that affect motivation all have a common root。 And the common root is something called cognitive。

dissonance and that means for psychologists who cook this idea up in our heads it's very difficult。

for us to hold conflicting pieces of evidence at the same time。 Conflicting thoughts about the。

same thing。 So for example if you've got a kid who you really adore and you think the kid is just。

wonderful the teacher tells you that your kid is a big problem in school。 Initial response is。

cognitive dissonance and that means two inconsistent things。 My kid I know is wonderful。

Teacher is telling me the kid is a jerk。 How do we deal with that？ That's the unpleasantness。

And in our head we don't like to hold that so we resolve it in various kinds of ways。

One of the ways in which we might resolve cognitive dissonance plays out in something。

called goal setting。 The importance of setting goals in organizations or in personal life。

If you think for example about the models of quitting smoking or other sorts of behavior like。

that they typically involve you making a promise。 But the promise is often to other people you care。

about like to your children saying I understand that smoking is killing me and I promise you。

I'm going to quit。 Okay。 And you give them that letter and they know you've made that promise。

And then comes the moment soon after that when you want to cigarette what do you do？ Now they're。

not around they're not going to see you do it so you could sneak away and do it。 The problem is how。

do you feel about yourself at that point？ I promised my kid I would do this I don't think of myself as。

a liar and yet I'm going to be doing something which is basically lying to my kids。 The resistance。

to doing that is because of the skull that you have set and the difficulty of having cognitive。

dissonance。 I think I'm a good person yet I'm about to violate my promise to my kids that's unpleasant。

I don't do it。 Another example of this is something known as the pig mailing effect。

Plays out a very similar way。 It's from the Greek myth and the George Bernard Shaw play and then。

the Disney Broadway movie My Fair Lady。 The idea that you can shape people's behavior by what you。

expect of them。 And the pig mailing effect says if you are one of these people especially who's a。

role model and you convey to the students or the people you supervise high expectations for them。

it affects how they think about themselves and it affects their performance。 So if you set higher。

goals for them and higher expectations rather for them they're inclined to achieve more。 Why？

Because they believe they can do it。 They might say gee I don't think I can。

finish this race but the coach tells me I can and she believes I can do it。

Therefore I go back and push a little harder。 So that's how the pig mailing effect works。

A third example of this which my colleague Mike you seem is going to talk more about later is。

equity theory and this has to do with unfairness issues。 When we perceive something as unfair。

it creates a similar problem in our head and we act in ways that try to create equity by changing。

the balance of our contributions。 If we believe something's unfair maybe we try to make it fair。

say by not working as hard。 We're going to hear more about that one a little later。 [BLANK_AUDIO]。