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Mellody Hobson at Ariel Investments - Coggle Diagram
Mellody Hobson at Ariel Investments
My take
1. How would you describe the organizational architecture (people, structure & systems, culture) at Ariel Investments? What strikes you as distinctive about each of these components?
2. How would you evaluate Hobson’s leadership to date: what are her strengths and what are her weaknesses?
Independence and resourcefulness
Entrepreneural mindset/ Business acumen:
She had thought through the benefits of Ariel buying back the fund from Calvert and determined that it was a good bet. Turns out she was right.
Leadership skills
Good negotiating skills.
She was forceful and confident in the negotiations with Calvert and eventually bought back the fund for Ariel. :
She was effective
Always got the job done.
Great judgement
Humility:
Debates with John but acknowledges that he is the majority owner of the business
Confidence
that kept the firm together during the financial crisis
Weakness
: She can come across as dismissive when she has a different opinion from someone else
Weakness
: Can be extremely blunt
Weakness
: Intense and could easily pick fights
Weakness:
Hesitation to delegate and re-delegate especially when she is not sure if the job will be done well
Communication
Accessibility
a. What is Mellody Hobson’s most significant challenge as she looks to her next chapter as a leader? Why does she have that challenge?
BIGGEST CHALLENGE: Giving up responsibility and this is because she is not comfortable with trusting others to do tasks when she fears they will mess up.
3. What motivates Hobson?
Challenges/ Commitment to social issues
4. How has Hobson built the capacity to have impact within the firm and outside the firm? What causes others to follow her?
She is available to everyone/ Track record for success /
Hobsons Leadership
Vision
: Hobson believed that anyone could be a potential customer
Also focused on diversification
Industry context
2017
Ariel Investments LLC holds $13.1 billion in total assets
Of Aril's size only 7.4% owned by minorities ad hold 5.2% of all firms
8.8% are women owned with 5.2% of all funds
Overall women and minority owned firms managed only 1.1% of global AUM
2017
Money management industry holds $71 trillion in AUM
3,600 firms manage assets of over $1B
BlackRock - $6T
Vanguard - $4T
Challenges facing Ariel
Customers move away from from professional money managers to more passive fund options
Short term thinking in the financial markets
Mellody Hobson
Values engrained in upbringing & life experience
Her mother taught her - Resourcefulness & Independence
John taught her Not to confirm and to always speak her mind
Functions
Individual investor services
Institutional investor services
Internal operations
Sales and marketing
Legal and compliance
Autonomy
She has full non-investment decision making rights. Why? John believes and trusts in her decision making and therefore doesn't see the need of 'standing over her shoulder'
Style
Holds people accountable
Communication
Demanding and straightforward
Values
Sees sensitive issues as opportunities not challenges
Breaking barriers
Double jeopardy of race and sex Hobson knew she had to work twice as hard as the next person
Knowing what's at stake she can't relax because what she represents is to important and she can't mess it up
Time and activities
She is always available despite her busy schedule. How? She shares her calendar with her colleagues (hourly updates). She also holds in office hour sessions with employees who take them seriously because they know she is hard to get
Sets up rules and systems
Leadership Challenges: Expanding her influence and impact
Product was too narrow
Capability was too narrow
Bench strength was too narrow
Detaching Ariel brand from John and Hobson
Hiring
Hi staff turnover especially in the 2-3 year tenure period
BIGGEST CHALLENGE: Giving up responsibility
John Rogers
Values
In a world where women could achieve anything
Believed in hiring people who were resourceful had independent point of view(could stand on their own)
Leaving legacy by coaching young and upcoming people
Functions and responsibilities
Investment and research
Style
More patient with people
How John and Mellody's relationship works
Regular conference calls on Sunday to mark upcoming deadlines, company strategy and potential investment strategies
Daily catch up calls in person or phone to maintain continuity in managing the firm
Division of responsibilities means that employees interact with Hobson and John independently
Both committed to getting their individual functions carried out to precision
Employees saw the different styles of Hobson and John as their combined strength as it means they will look at things from different angles and make the right decision (covering all bases)
They are open to debating and at the end of the day Hobson still respects John as the majority owner
They share a deep passion for the firm
Ariel the company
Owned 95% by employees 50% of who are minorities
Architecture of the business
Margolis
Communication - open and constant
Calendars
Accessibility
Opportunities for conversation
Edge: Underdog mentality mixed with confidence: they knew the challenges that come with being a firm of their type. The bar is set high for performance.
Majority of Company owned by employees 95%. Motivation to perform.
Diversity requires work and investment for it to produce value. It is mess and fixes are costly.
Diversity fosters innovation. There’s a push and pull of ideas and cultures and this leads to new ways of doing things and reacting to adversity.discovering new opportunities.
Adversity becomes opportunity to innovate