Mellody Hobson's inaugural MasterClass focuses on strategic decision-making, drawing inspiration from her extensive experience working with esteemed businesses.
Having joined Ariel Investments, a Chicago-based asset management firm, as an intern in the early '90s, Hobson has remained with the company ever since.
She assumed the role of president at the age of 31, successfully guiding the firm through the challenges of the 2008 financial crisis. In 2019, she became co-CEO alongside founder John Rogers. Ariel Investments currently manages approximately $17.1 billion in assets.
Hobson holds board positions at JPMorgan Chase and Starbucks and previously served as the chair of DreamWorks Animation's board. During her time at DreamWorks, she played a pivotal role in navigating the studio's acquisition by Comcast amidst the challenges posed by the rise of streaming services.
Hobson emphasizes the need for level-headedness and pragmatism during difficult periods, stating that magical thinking is counterproductive.
In her MasterClass, Hobson employs her experiences in leading businesses through challenging times as case studies. She highlights two notable strategies for effective communication during such periods.
Firstly, Hobson stresses the importance of making plans public. When Ariel faced heavy losses and client withdrawals during the 2008 financial crisis, Hobson and her team confronted daily firing from clients.
To address this, she emphasizes the significance of understanding the problem and devising a comprehensive plan. However, effective communication of the plan both internally and externally is equally crucial.
Internally, employees should have a clear understanding of the action plan and their roles within it. Transparent communication with customers and clients instills confidence when realism is maintained.
Additionally, even outside of crisis situations, Hobson underscores the value of communication. When working on new campaigns, products, or initiatives, clearly communicating the desired outcome helps to stay on track.
She mentions a company that writes a press release before embarking on a new plan, enabling leaders to measure success objectively. This approach fosters accountability and integrity.
Secondly, Hobson advocates for institutionalizing dissent within organizations. During the tense period of 2008-2009 at Ariel, communication became strained, and disagreements led to touchiness among analysts during research meetings.
To promote constructive communication and avoid personal attacks, the firm introduced the practice of assigning the role of "devil's advocate" to challenge each stock purchase consideration. This approach ensured that dissenting opinions were part of individuals' job responsibilities, eliminating personal biases.
The inclusion of opposing arguments transformed the dynamics of the meetings and continues to be implemented at Ariel to prevent groupthink and defensive behavior among employees.
In summary, Mellody Hobson's MasterClass delves into strategic decision-making by leveraging her extensive experience with notable businesses.
Key strategies discussed include making plans public to maintain transparency and instill confidence, as well as institutionalizing dissent to foster constructive communication and prevent biases. These approaches contribute to effective crisis management and overall organizational success.
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