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In a significant development that is all set to enhance passenger convenience and streamline travel procedures, Singapore's Changi Airport will soon introduce a groundbreaking shift in its immigration protocols.

As part of a comprehensive overhaul of the city-state's immigration laws, certain travelers will get the opportunity to embark on their journeys from Changi Airport without the necessity of a traditional passport. If reports are to go by, this initiative will be in place for the first half of 2024.

Referring to this, Communications Minister Josephine Teo, addressing the parliament, disclosed that this progressive shift will pivot around the widespread adoption of biometrics for authentication purposes at multiple automated checkpoints within the departure process. These checkpoints will encompass various stages, including the initial bag-drop, immigration clearance, and the final boarding process.

Read more: What's hidden beneath the canopy of the Amazon Rainforest?

Teo further explained that the primary objective behind these changes is to alleviate the burden on travelers, reducing the need for them to repeatedly present their travel documents at these critical junctures. This move is aimed at fostering a more seamless and convenient experience for passengers.

The timing of these changes aligns with the optimistic projection that the number of travelers to Singapore, a global financial hub, is poised to rebound to pre-pandemic levels by the upcoming year, with sustained growth expected thereafter.

To further accommodate this resurgence in travel, Singapore is actively expanding its aviation infrastructure by constructing its fifth airport terminal. Additionally, the highly-anticipated high-speed rail connection between Singapore and Malaysia's southern state of Johor is nearing completion, promising improved connectivity and cross-border mobility.

Minister Teo underscored the importance of adapting immigration systems to efficiently manage the anticipated surge in traveler volumes while ensuring robust security measures are in place.

Acknowledging Changi Airport's status as the world's top-ranked airport, it also witnessed the passage of 5.12 million passengers in June, marking a significant milestone as it crossed the five million passenger mark for the first time since the onset of the COVID-19 pandemic in January 2020.

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Singapore to start passport-free departures from Changi Airport from 2024

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It's a part of a comprehensive overhaul of the city-state's immigration laws, wherein certain travelers will get the opportunity to embark on their journeys from Changi Airport without the necessity of a traditional passport. If reports are to go by, this initiative will be in place for the first half of 2024.

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Hi all,

Hope you're all doing just fine. I was knocking around the idea of adding a second format to Formats Unpacked. I was thinking it could be a short, quick-fire interview with the people behind successful formats. Would you all be interested in that? Let me know your thoughts.

If you're in New York and want to learn more about content formats, measuring attention and getting workflow right, we're running a new half-day workshop in partnership with our good friend The Content Technologist. The workshop will be on the afternoon of Tuesday 26th Sept. Join us!

And finally, if you need help with your content, whether it's strategy or production, hit the button below. It's what we do at Storythings.
let's talk content formats!
OK. On with the unpacking. This week I'm unpacking a content format that has not only survived two world wars but also played a role in one.

Michelin Guide (guidebook)

The Michelin Guide is a guidebook that has been published by the French tyre company Michelin since 1900. The guide awards up to three Michelin stars for excellence to a very select few restaurants.

The origin story is fascinating. At a time when there were fewer than 3000 cars on the road in France, the Michelin brothers devised the guide to encourage motorists to go on more trips and travel further afield - thereby boosting car and tyre sales. This free guide was originally filled with handy information, such as maps, where to fill up with fuel, and places to see.

One day, Andre Michelin saw his guides being used to prop up a workbench at a tyre shop and decided that people would only respect it if they paid for it. A brand new Michelin Guide was launched in 1920 and sold for seven francs. As well as a list of hotels in Paris, the new guide also included lists of restaurants worth travelling to. A minor addition that turned out to be a stroke of genius.

As the guide's restaurant section became more influential, the brothers doubled down on their restaurant content. They recruited a team of mystery diners to visit and review restaurants anonymously. Soon after, the guide began to award stars to fine dining establishments. The star rating is based on the following criteria:

Despite being over a century old, it's still one of the most respected rating systems in the culinary world today and whist Michelin stars are ridiculously difficult to earn, they're incredibly easy to understand.

As one of the greatest pieces of content marketing ever, the magic in the format is consistency. Of course, the three-star rating is what it's known for, but the famous rating system would not exist if the brothers didn't give their innovative format something that all formats need - time.

Not all formats at instant hits. The guide, like many other formats that went before and after, took years to get right. It was consistency, publishing year after year, learning about their publication with each edition, that got them to the place they wanted to be. The guide went through many iterations before landing on the format we know today. Far too many great formats are denied the opportunity to fulfil their true potential because of a lack of patience, planning or a full understanding of what it takes to make a format work.

The Michelin brothers placed a massive bet that providing really valuable information for their customers would encourage them to get into their cars and drive further. It was a full two decades later that the guide introduced restaurants and a further sixteen years until the introduction of the three-star rating that is still used today. The association with excellence in food makes the brand synonymous with excellence in everything it touches.

It's worth noting that the content they provide isn't just valuable for their customers, it's extremely high quality. Such is the reputation of the quality of their content, their guide proved useful in wartime. In 1944, at the request of the Allied Forces, the 1939 Michelin Guide to France was specially reprinted for military use. When the soldiers stormed the beaches of Normandy, they carried with them these specially printed Michelin Guides because their maps were judged the best and most up-to-date available. Throughout the rest of the war, the soldiers relied on these guides and maps as they made their way through cities whose roadsigns had been sabotaged by the enemy.

I don't get out to Michelin star restaurants that often but when I do it will be to go to Etxeco in the Bless Hotel in Es Cana, Ibiza.

The Guinness Book of World Records, which originally started out as a book that would settle pub arguments, has been around for almost seventy years. It's gone on to become one of the most recognisable books in the world.

Interestingly, the Michelin competitor Pirelli has also had success publishing with its controversial calendar. The calendar has gone through many iterations and has been published on and off since 1964.

That's it for this week. If you'd like to unpack a favourite format do get in touch.

If you need more creative or strategic inspiration, please sign up for our other newsletters Attention Matters and the Storythings Newsletter. Join our network of over 11,000 creative explorers!

See you next time for some more format unpacking,

Hugh

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How a brilliant piece of content marketing has stayed at the top for 123 years

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What Is a Futures Contract?

A futures contract is a legal agreement to buy or sell a particular commodity asset, or security at a predetermined price at a specified time in the future. Futures contracts are standardized for quality and quantity to facilitate trading on a futures exchange.

The buyer of a futures contract is taking on the obligation to buy and receive the underlying asset when the futures contract expires. The seller of the futures contract is taking on the obligation to provide and deliver the underlying asset at the expiration date.

Understanding Futures Contracts

Futures are derivative financial contracts that obligate the parties to transact an asset at a predetermined future date and price. Here, the buyer must purchase or the seller must sell the underlying asset at the set price, regardless of the current market price at the expiration date.

Underlying assets include physical commodities or other financial instruments. Futures contracts detail the quantity of the underlying asset and are standardized to facilitate trading on a futures exchange. Futures can be used for hedging or trade speculation.

"Futures contract" and " futures" refer to the same thing. For example, you might hear somebody say they bought oil futures, which means the same thing as an oil futures contract. When someone says "futures contract," they're typically referring to a specific type of future, such as oil, gold, bonds, or S&P 500 index futures. Futures contracts are also one of the most direct ways to invest in oil. The term "futures" is more general, and is often used to refer to the whole market, such as, "They're a futures trader."

Futures contracts are standardized, unlike forward contracts. Forwards are similar types of agreements that lock in a future price in the present, but forwards are traded over-the-counter (OTC) and have customizable terms that are arrived at between the counterparties. Futures contracts, on the other hand, will each have the same terms regardless of who is the counterparty.

Application of a Futures Contracts

Futures contracts are used by two categories of market participants: hedgers and speculators.

Producers or purchasers of an underlying asset hedge or guarantee the price at which the commodity is sold or purchased. They use futures contracts to ensure that they have a buyer and a satisfactory price, hedging against any changes in the market.

An oil producer needs to sell its oil. They may use futures contracts to lock in a price they will sell at, and then deliver the oil to the buyer when the futures contract expires. Similarly, a manufacturing company may need oil for making widgets. Since they like to plan ahead and always have oil coming in each month, they too may use futures contracts. This way they know in advance the price they will pay for oil (the futures contract price) and they know they will be taking delivery of the oil once the contract expires.

Speculators

Since many commodity prices tend to move in predictable patterns, it is possible to make a profit by trading futures, even if one does not have a direct interest in the underlying commodity. Traders and fund managers use futures to bet on the price of the underlying asset.

For example, a trader may buy grain futures if they expect the price of grain to increase before the delivery date. Any unexpected changes to the weather or growing conditions may cause the futures price to rise or drop.

Types of Futures Contracts

Futures contracts can be used to set prices on any type of commodity or asset, so long as there is a sufficiently large market for it. Some of the most frequently traded types of futures are outlined below:

Agricultural Futures: These were the original futures contracts available at markets like the Chicago Mercantile Exchange. In addition to grain futures, there are also tradable futures contracts in fibers (such as cotton), lumber, milk, coffee, sugar, and even livestock.

Energy Futures: These provide exposure to the most common fuels and energy products, such as crude oil and natural gas.

Metal Futures: These contracts trade in industrial metals, such as gold, steel, and copper.

Currency Futures: These contracts provide exposure to changes in the exchange rates and interest rates of different national currencies.

Financial Futures: Contracts that trade in the future value of a security or index. For example, there are futures for the S&P 500 and Nasdaq indexes. There are also futures for debt products, such as Treasury bonds.

Futures Contract vs. Forward Contract

A futures contract is similar to a forwards contract, where a buyer and seller agree to set a price and quantity of a product for delivery at a later date. Both types of contract can be used for speculation, as well as hedging.

However, there are also important differences. While a futures contract is a standardized agreement that can be traded on an exchange, a forward contract is simply a private agreement between a buyer and a seller. While it is possible to trade forwards on OTC markets, they are less regulated and less accessible to retail investors. This means that there are also more opportunities to customize a forward agreement according to the buyer's and seller's needs.

Mechanics of a Futures Contract

Imagine an oil producer plans to produce one million barrels of oil over the next year. It will be ready for delivery in 12 months. Assume the current price is $75 per barrel. The producer could produce the oil, and then sell it at the current market prices one year from today.

Given the volatility of oil prices, the market price at that time could be very different than the current price. If the oil producer thinks oil will be higher in one year, they may opt not to lock in a price now. But, if they think $75 is a good price, they could lock in a guaranteed sale price by entering into a futures contract.

A mathematical model is used to price futures, which takes into account the current spot price, the risk-free rate of return, time to maturity, storage costs, dividends, dividend yields, and convenience yields. Assume that the one-year oil futures contracts are priced at $78 per barrel. By entering into this contract, in one year the producer is obligated to deliver one million barrels of oil and is guaranteed to receive $78 million. The $78 price per barrel is received regardless of where spot market prices are at the time.

Contracts are standardized. For example, one oil contract on the Chicago Mercantile Exchange (CME) is for 1,000 barrels of oil. Therefore, if someone wanted to lock in a price (selling or buying) on 100,000 barrels of oil, they would need to buy/sell 100 contracts. To lock in a price on one million barrels of oil/they would need to buy/sell 1,000 contracts.

The futures markets are regulated by the Commodity Futures Trading Commission (CFTC). The CFTC is a federal agency created by Congress in 1974 to ensure the integrity of futures market pricing, including preventing abusive trading practices, fraud, and regulating brokerage firms engaged in futures trading.

Trading Futures Contracts

Retail traders and portfolio managers are not interested in delivering or receiving the underlying asset. A retail trader has little need to receive 1,000 barrels of oil, but they may be interested in capturing a profit on the price moves of oil.

Futures contracts can be traded purely for profit, as long as the trade is closed before expiration. Many futures contracts expire on the third Friday of the month, but contracts do vary so check the contract specifications of any and all contracts before trading them.

For example, it is January, and April contracts are trading at $55. If a trader believes that the price of oil will rise before the contract expires in April, they could buy the contract at $55. This gives them control of 1,000 barrels of oil. They are not required to pay $55,000 ($55 x 1,000 barrels) for this privilege, though. Rather, the broker only requires an initial margin payment, typically of a few thousand dollars for each contract.

The profit or loss of the position fluctuates in the account as the price of the futures contract moves. If the loss gets too big, the broker will ask the trader to deposit more money to cover the loss. This is called maintenance margin.

The final profit or loss of the trade is realized when the trade is closed. In this case, if the buyer sells the contract at $60, they make $5,000 [($60-$55) x 1,000). Alternatively, if the price drops to $50 and they close out the position there, they lose $5,000.

Why Is It Called a Futures Contract?

Are Futures and Forwards the Same Thing?

What Happens If a Futures Contract Is Held Until It Expires?

Who Uses Futures Contracts?

How Can I Trade Futures?

The Bottom Line

Futures contracts play an important role in the smooth operations of the commodities market. By allowing buyers and sellers to lock in prices in advance, they allow farmers, miners, manufacturers and other market participants to work without having to worry about daily changes in the market.

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Futures Contract Definition: Types, Mechanics, and Uses in Trading

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A futures contract is a standardized agreement to buy or sell the underlying commodity or other asset at a specific price at a future date.

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The lottery industry's leading game innovation company and Europe's largest lottery have combined creative forces to bring to the market a next generation game experience that takes players from retail to digital and back again. And the twist? The journey is theirs to decide.

Scientific Games and La Française des Jeux's innovative iDecide game enhancement debuted at the World Lottery Summit in Vancouver last fall, and requests for demos are keeping the two companies busy on both sides of the Atlantic.

"It's creating a buzz. Everyone who's played the demo version of iDecide gets really excited. Lottery product managers have been wowed during demonstrations of the unique play characteristics of this exciting new game concept," says Harpreet Garcha, senior business development in Europe for Scientific Games.

The revolutionary new lottery game enhancement gives instant scratch card players the option to expand their winnings by continuing their play experience with an online digital game extension. The concept is a first for the global lottery industry.

Here's how it works: Each instant scratch card game featuring iDecide has a QR code and a callout promoting the opportunity to continue playing. If a player wins on the physical card purchased at retail, they can decide to cash their winnings or invest all or a portion of their winnings in a digital game extension by scanning the QR code.

To increase winnings, the player must successfully advance through the digital part of the game. Advancement is determined by the decisions the player makes during the interactive experience.

The added excitement is the element of risk.

" iDecide provides players with a retail lottery experience and, if they so choose a digital lottery experience that allows them to risk their scratch game winnings and keep playing. And it's all within the parameters that most lotteries operate within," explains Garcha.

The game extension concept can be applied to any instant scratch card. The amount players can win in each game is determined by the lottery. FDJ has launched one €3 and three €5 games featuring the iDecide enhancement across its network of 30,000 retailers in France.

"This is one of the most unique concepts to ever be delivered to the lottery market. We presented recently to the heads of different departments at a major European lottery. They all played the €5 physical scratch and one of them won €50," shares Garcha. "She decided to continue playing online with the digital game. Excitement built, and she ultimately chose to cash out with €100. This demo, which replicated a genuine player winning experience, delivered an enhanced level of player engagement and excitement."

Scientific Games' data analysts have been impressed with the success of the FDJ games - particularly the percentage of players who decide to continue playing with their winnings.

FDJ reports that approximately 60 per cent of players are opting to continue playing their physical game winnings in the online digital game extension. Testing with consumer groups was also conducted by Scientific Games.

" iDecide was strategically developed to connect physical and digital lottery play. There has never been anything like it. This is truly a next era game experience, and our players are truly enjoying the new concept," said Xavier Etienne, executive vice president of technology and international for FDJ.

iDecide games are secure and maintain the integrity and pre-defined prize structure of the physical game. Digital player registration is not required. All purchases are made at retail and prize winnings from both the physical and digital parts of the game are redeemed at lottery retailers.

If the player wishes to end play with the physical game, any winnings may be redeemed instantly at retail. If the player decides to move to the digital game, the winnings will be automatically updated with the outcome of the digital extension when the player presents the physical scratch game to the retailer.

Scientific Games vice president of sales Jeremy Kyzer, who is working with iDecide in the US, adds: " iDecide provides lotteries an opportunity to offer their players a unique omnichannel play experience while keeping all purchases and cashing within retail.

"It's a great way to further enhance the excitement of an instant game win by adding the option to continue their experience in a digital game extension for chances at higher prizes."

iDecide is a trademark of Scientific Games, LLC. © 2023 Scientific Games, LLC. All Rights Reserved.

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Next era lottery game experience is exciting players, connecting retail and digital - Gaming Intelligence

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Scientific Games and Europe's largest lottery have combined creative forces to bring to market a new experience

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Dumb phones are on the rise in the U.S. as Gen Z looks to limit screen time

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A resurgence in dumb phones in the U.S. may be tied to concerns about the mental health impact of smartphones, especially among younger generations.

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The neuroscience of startups: Unlocking the brain's potential for business success | e27

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The next time you're faced with a startup challenge, don't just think like an entrepreneur; think like a neuroscientist

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Why your next hire should be a highly sensitive person

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Sensitive people are high performers capable of innovation and creative problem-solving.

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Meeting overload is a symptom, not the disease.

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Scientific Games has been selected as the new systems technology provider for Lotto NZ, the national lottery in New Zealand. Lotto NZ officials recently announced that, as part of its plans for future growth and digital game innovation, the company will replace the Lottery's existing core gaming system and online gaming system with a new, fully integrated next-generation technology that includes a lottery retail system, retail point-of-sale technology, digital lottery platform and a digital content aggregation hub.

As part of a seven-year agreement, Scientific Games' advanced SYMPHONY™ gaming system was selected to support Lotto NZ's draw-based games engine and communications across its retail network, as well as more than 1,200 Contour.v™ retailer point-of-sale terminals and wireless ticket checkers. The company's digital lottery platform and the SG Content Hub, an all-new digital content aggregator, will deliver online games, including draw-based games, eInstant games from Scientific Games and leading lottery-focused digital game studios from around the world. The agreement begins with the new systems' go-live date and may be renewed for up to 12 years.

Lotto NZ currently offers Lotto, Powerball, Strike, Bullseye, Keno, and Instant Kiwi (retail and online).

Chris Lyman, Chief Executive Officer for Lotto NZ, said, "Scientific Games' commitment to providing engaging, socially responsible and leading gaming technology, with the customer firmly at its center, was a great match for Lotto New Zealand's values and the future focus of our business. We're confident of a collaborative and successful partnership in the years to come, and we are excited about getting started."

"As we prepare for responsible future growth, it's important that we appeal to a broad base of New Zealanders by delivering innovative and entertaining digital games that are simple to use, safe and fun. We chose Scientific Games as a technology partner based on the company's strong understanding of our goals, its range of integrated products and services that will help us reach our goals and its five decades of industry knowledge and experience."

Each year, Lotto NZ transfers 100% of profits to the NZ Lottery Grants Board, providing essential funding to thousands of community groups and organizations around the country every year for activities and projects. Since Lotto NZ was established as a Crown Entity in 1987, more than $5.5 billion in funding has been returned to New Zealand communities.

Michael Conforti, President, International for Scientific Games, said "Lotto New Zealand is a recognized leader in the global lottery industry, and we are committed to a technology implementation that will responsibly drive its business to the next level for the benefit of all New Zealanders. We are dedicated to helping Lotto New Zealand meet its goal of maximizing returns to New Zealand communities."

The company has provided secure retail instant scratch games to Lotto NZ for more than 30 years.

Scientific Games provides retail and digital games, technology, analytics and services to 130 lotteries in 50 countries around the globe. The company is a leading systems technology provider worldwide and the largest in Europe. Scientific Games is a digital lottery innovator currently serving more than 30 iLottery customers with entertaining game content and industry-leading digital programs, including CRM, loyalty, promotions, second chance, mobile and web applications.

Contour.v™ and SYMPHONY™ are trademarks of Scientific Games. © 2023 Scientific Games, LLC. All Rights Reserved.

About Scientific Games

Scientific Games is a global leader in retail and digital games, technology, analytics and services that drive profits for government-sponsored lottery and sports betting programs. From enterprise gaming platforms to exciting entertainment experiences and trailblazing retail and digital solutions, we elevate play every day. We are industry pioneers in instant games, data analytics, retail solutions and iLottery. Built on a foundation of trusted partnerships since 1973, Scientific Games combines relentless innovation, performance and unwavering security to responsibly propel the industry forward. For more information, visit scientificgames.com.

Media Inquiries:

Media@scientificgames.com

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New Zealand National Lottery Selects Scientific Games' Integrated Systems Technology to Power Growth and Digital Game Innovation

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Scientific Games has been selected as the new systems technology provider for Lotto NZ, the national lottery in New Zealand. Lotto NZ officials recently announced that, as part of its plans for future growth and digital game innovation, the company will replace the Lottery's existing core gaming system and online gaming system with a new, fully integrated next-generation technology that includes a lottery retail system, retail point-of-sale technology, digital lottery platform and a digital content aggregation hub.

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Inside the dazzling, $113 billion world of scratch-off lottery tickets

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Instant lottery tickets are designed to catch the eye and keep you playing.

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Powered by AI and the LinkedIn community

Innovation is the key to staying ahead of the competition and meeting customer needs in a dynamic and uncertain environment. But how do you develop and implement an effective innovation strategy that works for your industry or domain? In this article, we will explore some examples of successful innovation strategies in other industries or domains, and what you can learn from them.

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What are some examples of successful innovation strategies in other industries or domains?

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Learn from successful innovation strategies in other industries or domains, such as open innovation, frugal innovation, disruptive innovation, design thinking, and lean startup.

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CURT NICKISCH: Welcome to the HBR IdeaCast from Harvard Business Review. I'm Curt Nickisch.

Many great companies set out to transform their businesses. They come up with new strategies, they restructure, maybe even change industries, go digital. But many times, those well-thought-out efforts end up falling flat. Why? The company culture. If it doesn't fit the new strategy, you're toast.

So the obvious thing to do is to change the culture, right? Well, we know that's really hard. It's bigger than a CEO. It's not about what is written down on paper in HR documents. It's not easy to define, much less change.

But today's guest has studied leaders who were able to change their culture to fit a new strategy. The takeaway is how they told stories to reinforce that shift, stories that circulated around the workplaces, because a lot of what creates a culture is the way that employees and managers talk to each other about each other, and about the company and what it does. The stories they tell.

Jay Barney is here to tell us more. He's a professor at the Eccles School of Business at the University of Utah, my alma mater. He's a coauthor, along with Manoel Amorim and Carlos Júlio, of the book, The Secret of Culture Change: How to Build Authentic Stories That Transform Your Organization. They also wrote the HBR article, "Create Stories That Change Your Company Culture". Jay, glad to have you on the show.

JAY BARNEY: I'm very excited about it.

CURT NICKISCH: You spoke to dozens of CEOs, some who failed at changing their culture, those who succeeded, and it sounds like it's more than just luck or random success.

JAY BARNEY: I wouldn't discount that there is a little bit of luck and timing in these things. There's always of some that goes on. But we found many of the business leaders we talked to, many of them were CEOs, some were like plant managers, or division general managers, or office managers of large offices. Some of them have a pattern of being able to change their organization's cultures that they repeat over time, which suggests that it's not just luck, that there's actually a skill involved. Our task was to try to understand what those set of skills were that enabled them to make culture change happen.

CURT NICKISCH: Well, it's really interesting because you have this very hard problem, and then you have a very simple solution. You want to change the culture, and you say create stories, which seems easy -

JAY BARNEY: Well, let me start with an example. My coauthor's experience at Telesp, which was, as you said, a Brazilian telecom that was operating in a highly regulated environment, was about to move into a deregulated environment facing whole new competitors and whole new technologies at the same time. Also, all that was going to happen at once.

But they had developed a very, very top-down culture, aggressively top-down culture. So much so, for example, that one of the cultural values was that no one in the organization could ride with the CEO in the same elevator car, which is bizarre, I admit. But nevertheless, it was the symbol of just how top-down that organization had become, but successful.

CURT NICKISCH: So yeah, you're going from a top-down culture, which makes sense in a world where you have a regulated monopoly essentially.

JAY BARNEY: Sure. That's basically what it was.

CURT NICKISCH: You're going to a much more, still regulated, but competitive market where faster, more innovative companies could eat your lunch, right?

JAY BARNEY: Absolutely.

CURT NICKISCH: So, what did Manoel do?

JAY BARNEY: Absolutely - not a slam dunk at all, that the monopolist would be the survivor in a much more competitive market.

CURT NICKISCH: So, what did Manoel do?

JAY BARNEY: Well, the first thing is, you have to change your strategy. You can't be just worried about addressing government defined goals. You basically have to a culture that values customer service, and that values satisfying delighting customers on their telecommunications needs.

So, the specific thing that he did, that built the first story, this is only the first of several that were built by him, he bought a new technology, a new product that the company was coming out with. It was a new technology, it didn't work very well.

So he called the helpline. He got on the line with a part-time worker at the helpline. Now previously, by the way, consistent with the old culture, there had been two helplines. One for senior managers in the firm, and one for everyone else. Well, consumers. So the first thing he did is, he eliminated the one for senior managers and said, "Hey, we got problems with technology. We have to go to the helpline that everyone else has to go to."

So then he is in this two hour conversation with this young man, and they're still not having success. So finally, after two hours he says, "I want to let you know I'm the CEO of the company." Of course, the guy doesn't believe him, so it takes a few minutes to convince him. Then what happens is, Manoel asks, "So what would you have needed to know in order for you to be able to solve my technical problem with this product?" This young man generates a list of 14 things, "This, this, this, we need this. How much of this information do you have access to at this point?" The answer was, "Two or three things."

Then it gets interesting. Manoel says, "Would you be willing, with a couple of your colleagues, to come to our next executive committee meeting?," this is a senior group in the organization, "And explain what those 14 things are, and what needs to be done in order for us to support this new product technology?" Remember, this is deeply hierarchical organization and he's just flipping it.

CURT NICKISCH: This is skipping a few levels, yeah.

JAY BARNEY: Yes. Oh, just a few. This guy is not even an employee of Telesp, he's an outsourced employee. He's a part-time. It turns out, he's a college student. Anyway, he and his colleagues come to this meeting and give, "Here's what we need to do. Here's the problems. Here are the 14 things." Manoel thanks him. They leave the room.

He turns to the people, he says, "So here's the deal, in two weeks, we're going to have a plan. We're going to have it planned and ready to execute. It will help us collect all 14 bits of information we need to support this product. Until we have that plan, we're going to suspend sales of this product, because a customer-oriented company doesn't sell a product they can't support. And then you're going to present a plan for us about how we're going to get this information that we need. You're not going to present it to us, you're going to present it to these people from the call center we just talked to. So, you're going to be reporting to the call center employees."

Two weeks later, sure enough, it happens. They get the information, and the product turns out to be very, very successful. So, it's all good news. But from a cultural point of view, it just literally is a revolution in the way of thinking about organizational culture, about who's in charge, about what we value in this company. It's about valuing customers and customer relationships. It's not about hierarchy, and bowing to the boss, and doing whatever the boss has to say.

CURT NICKISCH: Gotcha. Now you have just told this story to me and to our audience. But in that story, there was no storytelling happening, right? There was action. There was something that was done maybe differently. It was effective because it was strategic. But where does the storytelling part of it come in?

JAY BARNEY: No, it's interesting. What you do is, you engage in actions, and the actions create stories that other employees share. Now, over time, you may come back and actually tell the story again and again. So, that may happen later on. But when you're in the process of creating the story in the first place, you act, you do things that are inconsistent with the old culture, but are consistent with some new culture. That's one of our criteria for being a successful story. It's got to break with the past, with a path to the future. This example is just a classic of this, of a clear break with the past.

We saw no examples. We interviewed 60 or so business leaders across multiple industries, multiple firms, et cetera. We saw no examples, zero, where successful culture change started with the announcement that we were going to change our culture. It's just cheap talk. It's just another thing, here it comes, CEO wants to change the culture. Okay. Everyone says, "Sure, we'll change the culture, sir." But, no one believes that it's really a commitment because it's cheap talk. It's easy to back off of it.

But action is much harder to back down, back off of, walk back, than words. So you act first, the stories then follow. But these business leaders don't write down the stories. They don't plan them out in detail or anything like that. They emerge in an authentic way because it reflect their deeply held beliefs about what the organization needs to do. Then those stories start getting shared. What happens is, those new stories that support a new culture replace the old stories that supported the old culture. Then as that diffuses throughout the organization, that's how we see culture change.

CURT NICKISCH: Yeah I mean if you want to change the story of, "That's not how we do things around here," you do it differently, and then people say, "This is how you do things around here."

JAY BARNEY: That's exactly right.

CURT NICKISCH: So it seems very important not to make up the story, but to make the story.

JAY BARNEY: It's got to be - one of our first criteria, we studied enough of these, so we could actually describe stories that seem to actually facilitate cultural change and those that don't. The first criteria is that the story has to be authentic to the person who's building the story. For example, if your values as a business leader are not customer-oriented and you say, "We're going to build a customer-oriented culture," no one's going to believe you. Employees can smell hypocrisy from miles away. The first criteria for this is that these stories have to be really authentic both to your personal values, and also to your understanding of the strategic challenges facing the organization.

CURT NICKISCH: Now, you mentioned personal values there. How important is it to bring the first person into it for organizational leaders?

JAY BARNEY: Oh, yeah. Our second criteria is, the business leader has to star in the story. I know there's a lot of discussion in the management organizational change literature about top-down versus bottom-up. I just want to say again, we saw no examples, zero examples of successful culture change that did not start at the top. That doesn't mean that these leaders don't engage the rest of the organization, they clearly do. But it starts at the top, and it starts when that's authentic, when a business leader behaves in ways that break with the past and give guidance to a new culture, and that individual stars in their story. Now other people will be there. So Manoel starred the story at Telesp, but the whole executive team was there. Those are the people who create the stories. They tell the stories.

CURT NICKISCH: Now, if you are supposed to feature yourself in your stories, like it or not, as an organizational leader, you are a character in the story.

JAY BARNEY: Absolutely.

CURT NICKISCH: Can that come off like bragging-

JAY BARNEY: Sure.

CURT NICKISCH: That is going to hurt your efforts?

JAY BARNEY: No, that's a great question. There's a question of, "How can I star in my story and still be humble and open?" Well, there's a couple of things to realize this. The first is, you're a business leader. People are watching what you do, in depth, and they do that whether you want them to or not. So you are already starring in the story. The question is, what story are you going to build. The second thing is, you have to also understand, the culture change process starts at the top. It's important that they diffuse throughout the organization.

The way that happens is, a business leader builds a couple more stories. Because one story, people are still cautious, "Is this real or not?" But you do two or three of these really radical things, then people start getting the idea. Then other people in the organization start feeling empowered by the possibility that they could build their own stories. Sometimes that happens with other senior managers and business leaders in the organization. By the way, as a business leader, you can see that. You can go to another business leader and say, "Listen, I'd like you to do something that builds a story that is consistent with the new culture.

Now, I can't tell you what that story is because it has to be authentic to you. But, I can see that to happen. Let me give you another really great example of this. There's a company, actually here in Utah, called Traeger. You know Traeger Grills? I'm sure you do.

The person who was running Traeger, Jeremy Andrus, was an investor in Traeger for a while, became convinced that Traeger had the potential for disrupting what was actually a very mature market, which is the outdoor cooking market, barbecues, and smokers, and things. But the organization that he inherited had a really toxic culture. He basically closed up the organization where it was and moved it here to Utah. Basically, built a new culture from scratch. One of the critical values of this new culture, he talked about it, he tried to show in his own behavior, build stories around, had to do with customer service. There was no limit on customer service.

He comes into work a Monday, and his sales VP comes in and says, "Did you hear what Rob did over the weekend?" "Who's Rob?" "Well, Rob's this first line employee. He has some responsibilities, but he is not a senior manager. He's just a guy in the office working hard, doing his thing."

Apparently, Rob somehow got a phone call from a customer, a Traeger customer in Seattle. The customer, his Traeger grill is not working. Now, this customer was a sales manager at a Costco up in the Seattle area. Costco, of course, is an important customer for Traeger. So Rob listens to the phone call and diagnoses the problem, goes to the office, picks up the part that's needed, gets on an airplane, flies to Seattle, fixes the machine with a part, helps the guy season his brisket, gets back on the airplane, flies home.

He comes into work on Monday morning, and it's no big deal. He's just sitting at his computer doing his work.

Well, of course the sales manager at that Costco tells his boss, who is the Costco store manager, what Traeger did, what Rob did. That guy then calls the head merchant at Costco corporate, who then calls the VP of sales at Traeger, who then tells the CEO of Traeger, "Did you know what your guy did? This is awesome. This is unbelievable level of quality of service." Jeremy Andrus' response was, "Yes, the culture is happening." This is a guy who is building his own stories on his own.

CURT NICKISCH: For many companies, culture is where they are, how people work together. And if you're talking about stories circulating at the water cooler and people passing these stories on, I wonder, in a post-COVID world, and where there's much more working remotely, working from home, much more virtual work, how that affects the efficacy of these stories, and just the distribution of these stories.

JAY BARNEY: I recently came from a meeting with a group of managers at a well-known consulting firm, and I was just listening. I was listening to the CEOs and other senior managers talk about the challenges they're facing. I came away saying, "What these people were saying was, 'Our organizational cultures are in tatters. They are in tatters, they're falling apart.'" For good reasons, I'm not saying I'm not arguing against going home during COVID. Obviously, that was a requirement.

But two things are very difficult where everyone's working from home. The first thing is, it's very hard to build new stories because new stories are created when groups of individuals confront situations that actually test their old values. So it's very hard to build new stories, and it's very hard to communicate those stories.

In Zoom, and related technologies while providing a form of communication, is still a cool medium. We can't read the body language. The picture we see is two inches square in a large meeting. We don't know the context. People are interrupting each other because they can't read the body language. Then they're dropping off and coming on, and the dog's running through.

All these things make it difficult. It makes it a cool medium, makes it difficult to get the really emotion and affect that has to be associated with telling these stories that are really profound in many ways. So between those two things, I think a lot of firms now are calling people back in, saying, "It's time to get back together," and there's resistance to do that. But one of the reasons to think about how to bring them in is to recreate the cultures that are in tatters.

CURT NICKISCH: Now you talked about the affect not coming across in video conference calls, for instance. One of the recommendations that came from your research is that organizational leaders need to be theatrical.

JAY BARNEY: Yeah. It's amazing, isn't it? I think you've said it a little stronger than I would say it. It turns out that many of the culture change stories that were created had a very theatrical element to them. That's how I would say it. Not all of them. What is theater? It varies a lot. But let me give you a really short example of one. This is one of my very favorite stories in the book. This is by a friend of mine named Jeff Rodek, who was the CEO of Hyperion a few years ago. This is during a time when the company had been doing fairly well and there was a big downturn in the market. They discovered that they really didn't have a strategy that was viable long-term.

He develops the new strategy in consult with the consulting firm. They put together a new strategy, and they're going to have a big meeting among the top management team to talk about the strategy and its implications, one of which is going to be a pretty significant layoff. So they're getting ready to do that meeting and it turns out that their planning people had already booked a meeting room at a very, very fancy hotel in San Francisco. And Jeff says, "We cannot have a meeting to decide to lay off a very large percentage of our employees at that hotel, it's just not right." His assistant says, "Yeah, we've already paid for the hotel." So he says, "We're going to change the meeting."

So everyone shows up to the meeting, and they come into the dining room. It's exactly what you'd expect, it's all fancy China and stemware. Then they sit down for dinner, and the first course is rolls and water, bread and water. Then the second course comes out, and it's also just bread and water. Then the third course, it's just bread and water. Then he stands up and says, "Listen, we don't deserve to celebrate with a fancy dinner here. We only deserve bread and water."

That is so theatrical, it's amazing. Talks about the strategy then, and the cost, and ends the meeting by saying, "I'm going to schedule this meeting room for one year from now, and we're going to have a real celebratory before dinner. We're going to deserve it, because tonight all we deserve is bread and water." I guarantee there's not a person in that room who forgets that experience because of the theatricality.

CURT NICKISCH: We know the old saying, hearts and minds. How do you tell stories? How do you not tell stories? How do you create stories that appeal to both? Because the stories will go on being told.

JAY BARNEY: Absolutely, and they evolve too. But we'll start with the head. We had heads and hearts, is how we use it in the language. But ahearts and minds thing. That hearkens back to the Vietnam, so I'm a little worried about that. Show my age a little bit.

CURT NICKISCH: Right. Right. Right. No, it does have that military connotation.

JAY BARNEY: It does. Get the hearts and minds of the people, so we use heads and the hearts.

CURT NICKISCH: Heads and hearts. Okay.

JAY BARNEY: That's okay. We start with heads. The reason we say that is that, if there's not a business case for culture change, then you should not engage in culture change. If a business leader engages in culture change without a strong business case, without the notion that you need to change your culture to implement your strategy, then it's an ego trip. Think of what you're saying, "I want to change the culture so that everyone's values are like my values." Seriously? That's the most egotistical thing imaginable. That's not going to work.

So you have to start with a business case, and it has to be very tight, and it has to be, "Our old strategy was X. Our new strategy is Y, and our culture needs to change to Y or we're not going to be successful," and the economics need to be compelling.

However, culture change is about changing people's sense of purpose at work, their direction, their sense of identity, how they interact with each other, very, very personal stuff. One reason culture change is so hard is because it requires us to change some basic assumptions about who we are at work and how we work with each other. It's like change resistance on steroids. We also see that a lot of these stories that were built also appeal to what they can call the better angels of our nature. They went beyond just, "Yeah, we're here to make more money and drive these other people away." Although that's part of it, to beat the competition. I got it.

But it's also - and in doing so, we're going to satisfy our customers. We're going to delight our customers more than they have been delighted in the past. We're going to give our employees an experience that they've never had before of being involved in creating this new business, and on, and on. So those things appeal to the heart. If it's just heart, we didn't see any examples of successful culture change that was just about, "Let's just be better towards each other." Bill and Ted, "Let's just be excellent towards each other." It turns out, not to be a compelling organizational change story. But if you have head and heart, then there's a good chance you'll be successful.

CURT NICKISCH: Is there anything you need to do to spread the stories? It makes me think of USAA, the insurance company. They have something that they do called mission moments where, at the beginning of meetings, they will stop and talk about a customer-

JAY BARNEY: Absolutely.

CURT NICKISCH: Their history with a company that serves military family members, so they'll talk about that person's service, and sometimes tell stories of solving that customer's needs. You know, talk about a great way to keep telling stories and then stay grounded in what you do as a company. But what do you recommend for telling the stories in informal ways? Or, do you just let stories take on the life of their own?

JAY BARNEY: No, we're going to do both. In the beginning, when a story is told, they spread like wildfire through an organization. Within a day, everyone in the company knows what's going on. Interestingly enough, for those who understand why we need to change the culture to align with the strategy, these employees take pride in these stories. They said, "Look what our CEO is doing, this is so cool. He's actually taking our organization and moving it in the way it needs to happen."

So in the beginning, our finding suggests that, interesting enough, don't be too aggressive in the beginning about having a more explicit communication policy because that can be a self-serving, a little marketing going on. That said, at some point, you have to start saying, "Okay." Usually, it's when some other stories are also being built in the organization that are also culture changing in nature.

You start looking for ways to communicate those through formal channels. You have online magazines, and chat rooms, and those things. It's great if you can get the press involved. Again, that's not to talk about you as the business leader, but to talk about the culture change.

So, let it diffuse on its own. By the way, shortly thereafter, build another story so you get that one backed up. After two or three of those stories that you've built, you continue to build them as well over time, then others will start building, and then you can go to a more formal communication model.

CURT NICKISCH: Yeah. Well, the previous culture was made up of lots of stories too, so you have to tell -

JAY BARNEY: That's correct. You're going to have to deconstruct the old one. Actually, that's the wrong language. It's subtle because one question we're asked, and it's a totally legitimate question is: A lot of people join a company because they liked the old culture, they selected into it, and they're actually really good at it.

Now you're putting a new strategy in place that requires a new culture. Isn't that bait and switch? Isn't that unfair? The answer is, "Yeah, it is." Some people who have been deeply loyal and deeply committed to the organization's old culture can feel very much disenfranchised. You know why? Because they are being disenfranchised. That's just it.

And some of those can be a business leader's good friends, they can be functionally very competent. But if the strategic analysis is correct, that we have to change the strategy, then it follows that we have to change the culture. Failure to do that can be deeply problematic. So, as a business leader, I don't want to lose that functional expertise. I don't want to lose that loyalty. I'm going to go to those people and try to bring them into the fold. But if they cannot or will not make the transition to the new culture, they may have to be let go.

CURT NICKISCH: If they do, you tell those stories and celebrate them.

JAY BARNEY: Exactly. Total win.

CURT NICKISCH: Can leaders at any level do this?

JAY BARNEY: The answer is probably yes. But our experience... I don't want to go too far beyond the data. Our estimate is that, if you have 50 or so people who are working for you, you have an organizational culture, whether you know it or not. So you can take responsibility for changing that culture. 50 or so, because at that point people may be dispersed, they may not see each other all the time. What happens is, culture is the control mechanism that fills in the blanks when policies and procedures don't talk about what needs to be done. As an organization gets larger and larger, then you start seeing culture becoming more important.

CURT NICKISCH: You mentioned, over time. How do you know when you're done? How do you know when the culture has been shifted?

JAY BARNEY: In an important sense, you're not ever done because cultures... You either invest in a culture or it drifts and dissipates. People think, "Well, maybe this culture is not that important." So there is a sense in which you have to continually invest in stories that build your culture, that continue to reinforce the strategy.

Besides that, strategies also change over time, context shifts, so you may have to change your culture, fine tune it a little bit. If you begin a culture change process... I've seen this, I won't name companies, but many years ago I was contacted by a firm that was competing against a very innovative competitor. This particular firm was known, this is in Silicon Valley, throughout the Valley as being risk averse.

Its competitor, when they came up with new technology that didn't work, they saw that as an opportunity to learn. This company, when the product didn't work, they treated as an opportunity to find out who was responsible so they could fire them. Well, guess what? They weren't innovative at all.

So they came to me and said, "We'd like you to help us change our organizational culture from being..." It starts with, "We did a six-month study and we found out we have a risk-adverse culture." Six months. This is a three-minute conversation with any employee. It's not a very complicated problem.

Another side note, we saw no, zero, successful culture change efforts that began with a study of the current culture. None. That's a way of usually avoiding culture change. So they did this study for six months. They said they were risk averse, and they said, "What we'd like you to do is come in here, and we'd like you to help us get rid of our old culture, and build this new culture, and we'd like this done in six weeks."

So in six weeks, they were going to be done. I distanced myself from that opportunity. The whole concept was flawed because culture change is an ongoing process that you continually build new stories. It's not just you that builds the new stories, employees throughout the organization build their own stories, and they continue to strengthen and rejuvenate the culture of the organization. Not so much an end point.

CURT NICKISCH: Jay, this has been really fascinating. And you've given a path forward through a really challenging problem for many many companies in a way that might bring them to a happy ending.

JAY BARNEY: I hope so.

CURT NICKISCH: So, thanks for coming on the show to talk about it.

JAY BARNEY: Thank you very much.

CURT NICKISCH: That's Jay Barney, professor at the Eccles School of Business at the University of Utah. He cowrote the new book, The Secret of Culture Change: How to Build Authentic Stories That Transform Your Organization, as well as the HBR article, "Create Stories That Change Your Company Culture."

And we have more episodes and more podcasts to help you manage your team, your organization, and your career. Find them at hbr.org/podcasts or search HBR on Apple Podcasts, Spotify, or wherever you listen.

This episode was produced by Mary Dooe. We get technical help from Rob Eckhardt. Our audio product manager is Ian Fox, and Hannah Bates is our audio production assistant. Thanks for listening to the HBR IdeaCast. We'll be back with a new episode on Tuesday. I'm Curt Nickisch.

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If You Want Culture Change, Create New Stories

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A conversation with Eccles professor Jay Barney on research about retooling culture.

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This will be an experiment worth watching. The need to manage and report finances on an annual cycle is clear. However through out my career I have seen lots… | 15 comments on LinkedIn