Chapter 4 from Charles Duhigg’s book, The Power of Habit weaves a tale of Paul O’Neill, the venerable CEO of Alcoa aluminium in Pittsburgh, Pennsylvania. As well as some interesting observations about Olympic Swimmer, Michael Phelps.
When introduced as the new CEO of Alcoa in 1987, O’Neil didn’t talk about about improving profits and reducing taxes, he spoke about improving the safety record for the Alcoa plants.
He knew there was a correlation to workplace safety (in an aluminium plant) and “…making progress in changing our habits across the entire institution.” He set a goal of zero injuries.
O’Neill knew that he couldn’t order people to change [ their habits ] but he could use the idea of keystone habits that would influence people in their manner of work, play, life and communication. What he did was investigate/understand how manufacturing processes in the plants was/were going wrong, which allowed him to understand why things were/would go wrong.
Defining the how, O’Neil could protect workers by educating the workers about quality control and efficient processes, which would allow it to be easier to work correctly – and thus, safer.
In addition, a new routine (habit loop) = anytime an employer was injured, it had to be reported within 24-hours to O’Neil. The reward, simple – embrace this new system (habit loop) and you are eligible for promotion.
This new safety-first approach, and habit loop also impacted other aspects of the company – measuring productivity led to manufacturing improvements (for process and safety), ownership for employees to stop the production line [ which help to reduce injury ], as well as impacting personal lives outside of the company.
This new habit loop of focusing on safety had farther reaching improvements that led to Alcoa’s profits reaching a record high, within 12-months of O’Neil speaking to company investors as the new CEO. And when Mr. O’Neil retired in 2000, the net income was 5x larger than when he arrived. Alcoa had an increase in market capitalisation of USD $27 billion. Read more at Forbes.com.
Michael Phelps. I can’t add much to the years of reporting that this athlete has had written about him. So here are some bullet points, that I find interesting:
- He started swimming at age 7.
- His coach, Bob Bowman helped Phelps with a series of behaviours that would calm Phelps and help him focus before each race.
- Mental visualisation started in Phelps’ teen years, when Bowman would tell Phelps to “…watch the video tape. Watch is before you go to sleep and when you wake up.”
- During practice(s), Bowman would yell “Put in the videotape!” which had Phelps swim as hard as he could – at race pace.
- Repeating the mental visualisation AND the practice at race pace – Phelps got faster, and faster.
- These are the foundations of the habit loop.
- The developed habits took over on race day.
- The races themselves were part of the pattern within the habit loop, and winning was reward.