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E145 Fall 2007Session 9
Entrepreneurial Teams:
NanoGene Technologies Inc.
Tom Kosnik, Fenwick and West Consulting Professor, STVPAnd
Gordon K. Davidson, Firm Chairman, Fenwick and West
Copyright © 2007 by the Board of Trustees of the Leland Stanford Junior University and Stanford Technology Ventures Program (STVP). This document may be
reproduced for educational purposes only.
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Our Agenda
• Teams open the NanoGene Technologies Case
• Discussion about compensation and culture
• Role Play the negotiation between four stakeholders: • Will Tomkins, Nanogene CEO
• Paige Miller, potential executive
• Will’s scientific cofounders
• Susan Stone, Venture Capitalist, potential investor
• Gordon Davidson: Lessons from the Valley
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© 2003 Mark P. Rice, Babson
Last Month:
Idea Versus
Opportunity
This Month:
Realities of
Business
Operations
Compensation& Culture
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Total
Remuneration
TotalDirect
Compensation
Figure 1-1. Model of a Total Rewards Program
Work Culture & Climate
Leadership & Direction
Career/Growth Opportunities
Work/Life balance
Job Enablement
Recognition
Intangibles
(Typically
Intrinsically
Valued)
Total
Reward
Cars
Clubs
Physical Exams
Perquisites
Retirement
Health
Time Off with Pay
Statutory Programs
Income Replacement
Benefits
Stock/Equity
Performance SharesLong Term Incentives
Annual Incentive
Bonus/Spot AwardsShort Term Variable
Base Salary
Hourly WageBase Cash
Source: Hay Group.
Total Cash
Common Examples Reward Elements Definition
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Understanding CultureMaslow’s Hierarchy of Needs
Order and Security
Affiliation
Achievement
Self-Actualization
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The Four Business Cultures
AT&T Consumer
Microsoft
IBM
Cultivation(Self-actualization)
Competence(Achievement)
Collaboration(Affiliation)
Control(Order & Security)
IndividualAccountability
GroupAccountability
Make ithappen
Let ithappen
“Can do” “Did do”
7 Managing Change within Differing Cultures © 2005, TCG Advisors LLCOctober 31, 2007
Cultivation Culture
Doing the unprecedented
Disruptive invention
Technology innovation
Brilliance
Self-organizing work
groups
Shared vision
R&D labs, creative
services
Cult
Core Motivation
Value Discipline
Differentiates by
Leads from
Organizes by
Accountable to
Preferred by
Degenerates into
8 Managing Change within Differing Cultures © 2005, TCG Advisors LLCOctober 31, 2007
Collaboration Culture
Serving the customer
Customer intimacy
Application innovation
Trustworthiness
Process teams
Customer satisfaction
Marketing, customer
service
Club
Core Motivation
Value Discipline
Differentiates by
Leads from
Organizes by
Accountable to
Preferred by
Degenerates into
9 Managing Change within Differing Cultures © 2005, TCG Advisors LLCOctober 31, 2007
Competence Culture
Beating the competition
Product leadership
Performance innovation
Expertise
Project teams
Metrics and compensation
Sales and engineering
Clique
Core Motivation
Value Discipline
Differentiates by
Leads from
Organizes by
Accountable to
Preferred by
Degenerates into
10 Managing Change within Differing Cultures © 2005, TCG Advisors LLCOctober 31, 2007
Control Culture
Executing the plan
Operational excellence
Process innovation
Authority
Reporting hierarchies
Business plan
Finance, supply chain
Caste
Core Motivation
Value Discipline
Differentiates by
Leads from
Organizes by
Accountable to
Preferred by
Degenerates into
11 Managing Change within Differing Cultures © 2005, TCG Advisors LLCOctober 31, 2007
Implications for Change ManagementEach Culture Responds to Different Levers
Cultivation Collaboration Competence Control
Motivation
FocusFreedom Relationship Compensation Promotion
Learning
StyleTrial & Error
Subjective
Feedback from
Customers
Objective
Feedback from
Metrics
Quantitative
Research
Negotiation
FocusWhat’s right What’s fair Rewards Benefits
Decision
StyleIntuition Consensus Debate Deliberation
12 Managing Change within Differing Cultures © 2005, TCG Advisors LLCOctober 31, 2007
Implications for Change ManagementThe Challenge of Multiple Cultures
• Communicating across multiple cultures• Focus on the shared value in adjacent cultures
• Find the balance between diagonal cultures
• When the company culture ≠ departmental
culture• CEO establishes the corporate culture
• Local executive establishes the local culture
• Local cultures adopt corporate norms at the interface between
their organization and other organizations
13 Managing Change within Differing Cultures © 2005, TCG Advisors LLCOctober 31, 2007
Implications for Change ManagementThe Challenge of Multiple Cultures
• Communicating across multiple cultures• Focus on the shared value in adjacent cultures
• Find the balance between diagonal cultures
• When the company culture ≠ departmental
culture• CEO establishes the corporate culture
• Local executive establishes the local culture
• Local cultures adopt corporate norms at the interface between
their organization and other organizations
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A Negotiation Framework
COMMUNICATION
RELATIONSHIP
INTERESTS
OPTIONS
CRITERIA
COMMITMENT ALTERNATIVES
If “Yes” If “No”
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Negotiation: Role Play
• Gordy Davidson will be our Guest for the Role Play. He will lead the team representing Will Tomkins
• We will do a tag team role play the negotiation between four stakeholders:
• Will Tomkins, Nanogene CEO
• Paige Miller, potential executive
• (the class) Will’s scientific cofounders
• Susan Stone, Venture Capitalist, potential investor