Middle Managers often feel “sandwiched” and frustrated in organizations, especially during changes. Recent studies indicate further reduction in the number of middle managers in organizations. How do middle managers navigate successfully, manage selves and stay increasingly relevant in a fast changing/evolving world? Organizations also need to tread cautiously with a longer term perspective and focused work on changing mindset and culture, as they plan changes.
These are selected notes, interesting data from a couple of Korn Ferry articles – Where’d My Manager Go? (LinkedIn), and A World with No Managers? (Korn Ferry website).
* Last year, in a sign of the aggressiveness with which firms are removing them, middle managers represented 31.5% of all layoffs, and an average of 22% between 2018 and 2022. * And when middle managers depart voluntarily, they are not being replaced, which creates a void in leadership. “If you cut and cut and cut, but don’t change mindsets, you can accelerate vertical hierarchy,” says Mark Arian, CEO of Korn Ferry Consulting. “You can end up in a bit of a death spiral.” * In theory, trimming the middle layer can strengthen workflows: Autonomy and decision-making extend downward, and customer responsiveness improves, along with accountability and morale. But “that doesn’t necessarily happen”. In practice, sometimes authority coalesces at top levels, leaving underlings awaiting signals. * But experts say today’s middle managers are under unprecedented pressure. Half are burned-out. Thirty percent are too stressed to support their teams, according to employees participating in LinkedIn’s Workforce Confidence survey. * Experts advise firm leaders to proceed with great caution. “When you get rid of middle managers, the margin for error becomes minuscule.” * Rather than making deep cuts, experts advise piloting studies of new organizational structures. * Experts advise training teams to be inclusive and knowledgeable about the expertise and leadership of each trainee.
In my observation and personal experiences, during most times after the organizational deep cuts, the vaccum between the top and front line grows leading to major communication gaps and frustration among team members. Top levels of the organizations do not end up having sufficient time to manage the increased demands and need for attention. For those reasons, it is extremely important to work on workforce culture and mindset changes proactively, in order to ensure better readiness. Most times, there is a mad scramble after the quick cuts are implemented. It is also important to think about the inter generational shifts in the workplace and related impacts.
McKinsey recently shared an interesting discussion regarding how the HR function’s own stress is showing. This is a very relevant and needed discussion because during most times of intense changes, HR members also feel exasperated and in a thankless role (referenced in a recent New York Times article). They feel caught in between, and hit from all sides. Many HR professionals can relate to this discussion, based on their own experiences.
One differentiator for great HR professionals and leaders is that they take the time to reflect, process, learn from the challenges and figure out ways to work through them proactively with a growth mindset. This discussion is valuable food for thinking for not just HR professionals but also for all key stakeholders.
Here are some highlight notes for me from the discussion.
* Research reporting that 35 percent of HR leaders surveyed don’t believe their management team cares about their mental health. * The HR function lives in the friction between caring for the employee and caring for the organization. * Organizations need to understand the importance of partnering with their HR colleagues and engaging them early when they’re thinking about strategic changes. The earlier you engage your HR business partners in those conversations, the better it is for the organization. * When it comes to capability building, we need to be thoughtful about what we put on HR versus the rest of the enterprise and ensure that people leadership is a joint capability. * It’s very easy to add things to the portfolio of trainings, surveys, and information gathering. It’s a lot harder to stop doing things. So creating and building that muscle and challenging the status quo is something that every organization needs. * As an HR leader, I can bring joy if I can be my authentic self with a team that is excited to work with me and views my input as a real contribution. * If my day-to-day is going to be more joyful, more energetic, and more fun, then I am working with people I like and respect who like and respect me. And we’re engaging on some cool topics together, making our organization a better place. * Sometimes HR is the messenger caught in the middle. * Over time, the administrative side will likely become easier or more automated. However, there is still an unbelievable need for a human element that can translate even self-serve tools to help a colleague in need. * Trust is hard earned but can go away in a second. And it can go away in a second because of HR but also, unfortunately, because of business leaders. It’s important to be thoughtful in those moments. The unified voice helps build trust, but a little division amplifies quickly across teams and organizations. If leaders understood that impact, they might choose their words differently. * We also need to build trust within HR. HR has to stick up for HR, too. And everybody has to own the full agenda. We need everybody in HR to speak up. Otherwise, you may build immediate trust but undermine trust in HR as a whole.
Source: Why being in HR is getting tougher—and how to break through; November 1, 2024; McKinsey & Company
I wanted to share some useful notes from the book, “The Psychology Of Fear In Organizations” by Dr. Sheila M Keegan, a Chartered Psychologist, and Fellow of the Market Research Society and Bath Business School. A lot of these play out in organizations every day and it helps a lot for leaders to be aware.
*Business psychologist and coach, Chris Welford identifies five telltale signs of a fear-based culture. 1. There is a preoccupation with status and conformity, and where rules have precedence over common sense. 2. Distinct in-groups exist and there is little opportunity to cross the boundaries between them. 3. Everything is measured but nothing is questioned. 4. Appraisals are only ever one-way. 5. The accent is on pace but short-term gain is known to be at the long term cost.
…Not surprisingly, in a fearful working climate, employees tend to mirror the behaviour of their managers. Management over-control generally has the effect of discouraging risk-taking, squashing initiatives and dispelling creativity and novel thinking.
… Feeling fearful, threatened or undermined at work can have a major effect on our work performance, as well as on our mental and physical health. Fear impacts our relationships with our colleagues and managers. We bring fear home with us…
How To Develop Personal Resilience, A Critical Element For Working Effectively Through Fear …On a personal level, developing resilience is an ongoing process that involves a mixture of adjustments. Resilience can be developed by: * having supportive work networks and healthy relationships. * focusing time and energy on things we have some control over, rather than expending energy on aspects that are outside our control. * actively looking for opportunities for self discovery and broadening our perspectives. * practising cognitive restructuring: changing the way in which we think about negative situations. * paying attention to our body as well as our mind, paying attention to one’s own needs and feelings. * keeping a long term perspective, and considering the broader context. * taking decisive actions. * maintaining a hopeful outlook… — These are only few perspectives on a much broader topic.
India is already among countries with the greatest demand for data analytics from the workforce, around 17% of job postings already looking for data analytics skills. Looks like the India job market is evolving fast, even in comparison with rest of the world. This also holds valuable food for thinking for the education ecosystem and how much/how well they cater to these requirements.
The snapshot above is from the Business Standard (based on data from Cornerstone) yesterday.
With all of the data push, there is an ever increasing need for focus on quality leadership, management practices and processes, and employee health and well being.
Interesting notes on executive compensation from Deloitte’s 2024 India executive performance and rewards survey report. Noticed a related discussion on ET TV. According to Deloitte report site, their survey covers information from over 400 companies across all major sectors.
In general, executive compensation continues to grow, and evolve fast with the market. Senior leadership roles come with much higher complexity, risks, stress and decreasing tenure. All the more reason for CEOs to have sounding boards and coaching support.
According to a Mint analysis of data from the past decade (2020), a CEO or MD of an average BSE 500 company stayed in the role for 3.4 years. Fewer than half of Indian CEOs completed three years in office. The tenure varied with industry and women were underrepresented. The global average for the world’s largest 2500 companies during 2004-18 was 5 years (PwC study).
Regarding age, “in NSE-500 companies, a typical Indian CEO today is 57 years old (roughly similar to Fortune-500 firms, where the average age of the top executive is 57.7 years). For the mid and small sized companies, the average age of CEOs comes down to about 50-52 years.”
Notes from the Deloitte 2024 report: * About 45% of S&P BSE 200 companies (excluding PSUs) witnessed a change in their CEO incumbent over the past five years. Almost six of every 10 new CEOs have been internal promotions. Amongst homegrown CEOs, business heads or CEOs of other group/parent companies were chosen to be the successors. In case of external hires, 81% of the new external CEOs were sourced from the same sector. * About 3 of every 4 CEOs in India now earn more than INR 5 crore [approx. USD 596,000]. * Faster increase in promoter CEO compensation compared with professional CEOs. * Average CEO compensation in India stands at INR 13.8 crore [USD 1.6 million], up 40 percent compared with pre-COVID times. * Fixed pay for promoter CEOs now constitutes over half of the total pay. For professional CEOs, pay-at-risk (Short Term Incentives + Long Term Incentives) is much higher at 57 percent of the total pay. * Companies assess CEO performance holistically but largely link only financial performance to incentives. * The prevalence of stock options or ESOPs dropped from 68% to 49% over the past five years despite more companies using LTI. Larger companies with more mature compensation practices are adopting performance shares faster, in line with global best practices. * The wide gap between median and average CEO compensation [INR 9.3 crore versus INR 13.8 crore] indicates the wide range of compensation numbers and some outliers on the higher end. * After the CEO role, COO and CFO roles continue to command the highest compensation premiums (followed by CHRO role).
References: * Old is gold, but new-age cos…; Feb 6, 2024 * The average Indian CEO lasts less than 4 years…; Mint, Updated Oct 2020 * Deloitte 2024 Executive…Rewards Survey Report; Apr 2024
Recent data from BCG on corporate transformation and link with total shareholder return(TSR) hold valuable food for reflection. We see transformation initiatives in most companies nowadays, especially when leadership changes happen.
Selected Notes from the article:
* The empirical patterns of transformation are quite stable: At any point in the past 20 years, roughly 30% of companies significantly underperformed their sector for a period of multiple years, making transformation a necessity for performance reasons. * Successful transformations are the exception, rather than the norm, even when measured on very modest criteria. Only 26% of corporate transformations successfully created value in both the short and long terms. More than 70% of companies fail to outperform their industry peer group average in both the short (one year) and long term (five years), after a previous performance downturn period (numbers quite similar to the findings in 2018 report). Sustainable value creation through transformation remains so rare.
* Pre-emptive transformations create significantly more value in the medium and long run. * A leadership change during a transformation is associated with higher TSR performance over the five-year time horizon. The positive impact is even higher if the new leadership comes from outside of the company. However, a change in leadership is not a guaranteed success driver. * You cannot cut your way to greatness: differential growth is critical to sustained value creation. * Achieving sustainable growth and a future-proof operating model requires entering transformations with a long-term orientation, rather than merely focusing on addressing performance woes or catching up to peers in terms of technology stack or organizational best practices. Beyond mindset, culture, and metrics, a long-term orientation also means investing in the exploration of new ideas that could be the basis of future advantage. * Putting a formal transformation program in place, scale of the program and the willingness to invest in change matter. Formalizing the transformation entails defining a clear governance and process-or setting up a dedicated transformation office-for coordinating and tracking progress on change initiatives, as well as regularly communicating it to the executive leadership team so that roadblocks can be addressed promptly. Moreover, it may mean putting in place a chief transformation officer to helm an ambitious change effort, which our prior research shows can improve transformation odds significantly. The role must be designed appropriately and filled by someone who is persistent, vigilant, and flexible—and who is trained for the job.
Source: Five Truths (and One Lie) About Corporate Transformation, April 12, 2024, BCG
These are selected notes from the book, “Building Conflict Competent Teams” (Craig Runde, Tim Flanagan; 2008).
Reappraising What’s Happening
“We often think that others’ motives are worse than they actually are, and this causes us to feel threatened and get upset. Looking at the situation to find less sinister motives can dampen your emotions. This process is referred to as reframing; that is, you consider the situation from new frames of reference. It is associated with a psychological concept called cognitive reappraisal, described by a quote from Marcus Aurelius: “If you are distressed by anything external, the pain is not due to the thing itself, but to your estimate of it; and this you have the power to revoke at any moment.”
Cognitive reappraisal means reinterpreting the meaning of what you see or hear. You may initially construe another person’s actions as hostile to your interests. Perhaps you think they are moving in on your turf or trying to make you look bad in front of others. Although this is certainly possible, there may be innocent reasons for their actions. Research has shown that reappraising situations can lessen emotional tension. In particular, changes in brain activity are analogous to those that occur when a person uses reflection and mindfulness techniques. When this happens, negative emotions lessen and more positive emotions emerge….
Team leaders can have a profound impact on the emotional climate of their teams. Leaders who demonstrate positive moods and effective emotional control can create a positive climate within their teams. When a leader conveys news, her tone and demeanor may have greater impact than the content of the message. The team leader plays a critical role, but all members of the team have to work together to address conflict effectively. They need to participate in developing and upholding team norms, which support and empower individual team members to step in when they see relationship conflict emerging that can harm the team. A team member who sees other teammates acting in ways that are breaching trust or contributing to destructive conflict can intercede and remind the others of the team norms for how to deal with conflict… “
According to a recent Korn Ferry Briefings podcast (The Frenzy To Find Work), around 77% of job seekers were ‘ghosted’ (abruptly cutting off contact/all communication) by companies last year. Studies from the platform Indeed also indicate similar percentages in recent years.
According to a report from the hiring platform Greenhouse, around 45% of job candidates have been ghosted after an initial conversation with a recruiter. Researchers also found that candidates from historically underrepresented backgrounds are 62% more likely to be ghosted after a job interview. These studies may be U.S. focused but I’m guessing this aspect of India market is not different.
During recent years, we saw companies complaining about candidates doing the same. When the job markets are strong, the pendulum tends to shift.
All parties seem to be overly focused on the short term. The reasons for ‘ghosting’ on either side could be many. This leads to classic “Lose-Lose” situations.
How can we think “Win-Win”?
Companies need to figure out at a bare minimum, to use technology (most tools nowadays support this) effectively to at least inform/update the candidates on where they stand (even if it’s a short message). Behaviors/habits of recruiters/recruitment teams need to be aligned. In many cases, these teams are short staffed and therefore, recruiters tend to focus/prioritise completely on closing open roles. Companies need to ensure that their brand value and trust do not erode by ignoring this important aspect.
Similarly, candidates also have a responsibility to inform companies on where they stand in terms of their decision making.
Think long term, win-win. This builds engagement and effectiveness both ways.
Toxic work environments can be dangerous, result in physical and mental health issues, and impact sustainable business results (often missed in the short term). Are they more widespread that we assume?
Poor leadership could be one of the leading causes and indicators.
Many will experience, are or would already have experienced a challenging, toxic work environment or leader at some point in their career. That can be debilitating and intense. It may also change you. It is difficult to understand pain until you’ve experienced it yourself.
* Among the top Predictors of Employee Turnover During the Great Resignation, professors from MIT Sloan and NYU Stern found (2022) that a toxic culture is 10.4 times more likely to contribute to attrition than compensation. A toxic corporate culture is by far the strongest predictor of industry-adjusted attrition. * From a poll of 1,000 UK employees (2021), 7 in 10 Brits shared they’ve worked in a toxic environment at some stage of their career. According to Oak Engage’s Toxic Workplace Report (2023), 75% of UK employees admit they have experienced a toxic workplace culture. 87% agreed that a toxic workplace culture has had a negative impact on their mental health and 73% agreed that a toxic workplace culture has contributed to their burnout. * According to a poll (2023) of more than 1,300 U.S. adults conducted by online career platform Muse, nearly two-thirds of workers have faced so-called toxic work environments. * According to Talent Works (2022), the majority of women in technology have experienced toxic work environments, with 21% experiencing it frequently. * According to one survey in India, tech workers are willing to accept lower salaries and even take pay cuts, if it means being a part of a company with a non-toxic work culture. In another one (2023), 87 per cent felt work-life balance is top priority for combatting toxic work culture and 31 per cent attribute pressure at the workplace as one of the main concerns for mental health issues.
What approaches have worked for you, to effectively manage through a toxic work environment?
Artificial Intelligence (AI) can help usher in a new era of human resource management, where data analytics, machine learning and automation can work together to save time, and provide information, insights and recommendations in near real-time.1 According to Gartner, 81% of HR leaders have explored or implemented artificial intelligence (AI) solutions to improve process efficiency within their organizations. Gartner expects generative AI solutions to become embedded in current and new HR technology providers in the next one to three years. Generative AI could first begin to appear in the natural language processing (NLP) space (virtual assistants, chatbots, data processing etc.).2 The Oracle and Future Workplace AI at Work Global Study 2019 found that 50% of workers were already using some form of AI at work.3
Potential Shifts in HR Ways of Working
Artificial intelligence will have an effect on the work conducted by the HR function, across the employee life cycle. This includes HR operations from onboarding to exit, spanning across talent acquisition, employee engagement, learning and development, total rewards, talent management and service management.
In talent acquisition, an AI algorithm could predict which sourcing channels would most likely attract the right candidates for a specific skill set or role, optimise sourcing spend, and suggest employee profiles which may hold higher probability of success and fit for an organization.4 On the other side, it could alert the candidates with the right skill sets to available jobs. In learning and career development, employees could get curated development and personalized recommendations that maximize career potential. Instructional design could also be impacted, with increased accessibility, flexibility and convenience. In compensation, AI could help analyze a wealth of data points relative to the local market and competitor data. It could provide analytics and recommendations on relevant benefits. AI-powered HR chatbots or assistants could help empower employees with quick, efficient service support.5 Real time inputs on performance at the individual, team and organization level, engagement and culture, leading to indicators on organizational outcomes would be impactful. As the size of HR teams get smaller, AI assistants could guide managers and leaders on right approaches for managing performance and high performing teams. Available external environment data could be analysed for proactive decisions and actions. Applications that use generative AI capabilities (such as ChatGPT, Bard, DALL-E) could improve the efficiency of the HR team and function.
Talent Strategy
Since fewer people will be needed to complete the same amount of work, it would be realistic to anticipate lesser headcount needs over time. The nature and content of work itself would change. Jobs disrupted by AI may need to be redesigned to encompass broader, comprehensive competencies with a more compelling employee value proposition.6
To meet these quickly evolving needs, leaders may need to revisit the six kinds of investments (six ‘B’s) needed to upgrade talent – Buy, Build, Borrow, Bound, Bounce, Bind.7 For the Build/training approach, organizations may focus on upskilling, reskilling and new skilling initiatives. Reskilling involves training employees on an entirely new set of skills to prepare them to take on a different role. This typically occurs when workers’ previous tasks or responsibilities become irrelevant. As opposed to reskilling’s 180-degree pivot, upskilling occurs when workers improve upon existing skills and deepen their abilities and impact within their area of expertise. The term new skilling represents all types of continuous learning to help build high-demand skills. A new skilling mindset keeps both a workforce and a company agile by ensuring learning initiatives are relevant to future business objectives.8 Performance expectations could vary significantly in newly configured roles and environment.
AI would influence employee expectations about how employees interact with HR teams and tools. Over time, this shift will lead to rethinking the purpose, objectives, skillset and structure of HR roles and the overall function. Along with the increased requirements, leading/managing with the updated knowledge of psychology, neuroscience, culture, change, leadership, organization behaviour, business acumen and technology will give influential HR leaders and teams a distinct advantage. Change management could become a critical competency requirement for the whole team.
Workforce Planning
Since AI investments will lead to the obsolescence of many tasks, while creating the need for new skills and roles, this shift involves proactive planning, change management and updating the capabilities of the overall workforce. Proactive workforce planning based on a deep analysis of phases of change becomes critical for the success of any organization. New, specialized, complex jobs may emerge where generative AI and related technologies are used, resulting in competitive advantage.
Culture Intersection
A major change like this cannot be possible without shift in mindsets and behaviours. This inevitably intersects with organizational culture elements. HR teams that proactively assess, plan and facilitate the culture and mindset shift for the organization would play a fundamental role in facilitating this transformation successfully.
Concerns
While AI is creating excitement, there are concerns about aspects like accuracy, privacy, bias and reliability. Any information posted may be used to further train the model, raising concerns about confidentiality. Generative AI learns based on historical data, and historical patterns of data may reflect biases. Instances of bias in AI tools have come to light, offering case studies in the limitations of machine learning (eg. talent acquisition tool bias).9 Recent guidance from The Equal Opportunity Employment Commission (EEOC) in the U.S. clarified that bias in AI tools may violate discrimination protections, and employers who use them could be held accountable.10
Therefore, it becomes critical to involve all points of view while planning and implementing AI adoption. While the value and transformation potential of GenAI are real, so too are the technical, implementation, and change management challenges. The time-saving potential can vary significantly based on industry-specific contexts. Consulting firm BCG recently found that support functions such as technology, operations, and customer support showed the highest potential productivity gains from GenAI deployment. Looking at GenAI activities across the company will help to ensure that the sum of efforts is greater than its parts, leading to transformative change rather than incremental refinement.11 The true potential of mature AI solutions may take time. Initial rollouts might result in less-than-desired experiences. Organizations must also acknowledge and guide about potential risks of generative AI and using sensitive or confidential data. A recent incident of sensitive data leak from a large corporation accidentally to ChatGPT, led to the company crack down on usage of the generative AI services.12 AI is also susceptible to hacking. The ethical and fairness elements have to be thoroughly assessed and analysed. Government regulation, policy, and international standards also play a fundamental role in our society.13. Labor relations and unions could also play a key role in this transformation.
While this is an exciting time for HR leaders and teams to be part of this evolution, prioritising change agility, curiosity, experimentation, growth mindset, risk awareness and development for self, team and the organization will increase chances of success. Modernizing talent capabilities within the function will become non-negotiable. When unique human capability, diversity and potential are augmented (not replaced) by AI, the stage for immense creativity and innovation is established. It looks clear that this is the beginning of a long, transformational journey and any future HR strategy without incorporating AI would seem incomplete.
ChatGPT – Inputs about AI Applications in HR
Since this is an article on AI, I gathered consolidated inputs below from ChatGPT regarding AI applications in HR. Readers may assess the similarities and differences between the above and below sections. I see the value in augmenting insights, while maintaining the creativity, unique connections, thought process and wisdom of an expert. Even here, the ability to ask the right questions or prompts through specific inputs seems important. If you want good outputs, you may need to provide good inputs, apply experimentation and thinking.14
AI applications in HR are designed to streamline processes, enhance decision-making, and improve overall efficiency. Here are some common AI applications in HR:
Recruitment and Talent Acquisition
Resume Screening: AI algorithms can analyze resumes quickly and efficiently, identifying relevant qualifications, skills, and experience.
Chatbots for Initial Interaction: AI-powered chatbots can engage with job candidates, answer basic questions, and even conduct preliminary interviews, saving time for both candidates and HR professionals.
Predictive Analytics: AI can analyze historical data to predict which candidates are more likely to succeed in a particular role, improving the quality of hiring decisions.
Employee Onboarding
Virtual Assistants: AI-powered virtual assistants can guide new employees through the onboarding process, providing information on company policies, procedures, and answering common questions.
Employee Engagement
Pulse Surveys:AI can analyze employee feedback and sentiment from surveys and other sources to gauge overall engagement levels and identify areas for improvement.
Personalized Learning:AI can recommend personalized training and development programs based on an employee’s skills, performance, and career goals.
Performance Management:
Feedback and Recognition: AI can facilitate real-time feedback and recognition, helping managers provide timely acknowledgment of employee achievements.
Performance Predictions:Predictive analytics can help identify patterns in employee performance data, allowing HR to anticipate potential issues and take proactive measures.
HR Analytics:
Predictive Analytics for Turnover: AI can analyze various factors to predict which employees are at a higher risk of leaving the company, allowing HR to take preventive measures.
Workforce Planning: AI can assist in forecasting future workforce needs based on historical data and market trends.
Employee Assistance and Support:
Chatbots for HR Queries: AI-powered chatbots can handle routine HR queries, providing quick and accurate information to employees.
Wellness Programs: AI can support employee well-being by providing insights into stress levels, workload, and suggesting personalized wellness programs.
Diversity and Inclusion:
Bias Detection: AI algorithms can help identify and minimize unconscious biases in job descriptions, recruitment processes, and performance evaluations, promoting diversity and inclusion.
Compliance and Risk Management:
Monitoring Compliance: AI can assist in monitoring and ensuring compliance with HR policies and legal regulations, reducing the risk of non-compliance.
Implementing AI in HR requires careful consideration of ethical concerns, data privacy, and the potential impact on the employee experience. However, when used responsibly, AI can significantly enhance HR processes, allowing professionals to focus on strategic initiatives and creating a more engaging and efficient workplace.15
Leadership Coach, Consultant, HR Leader with diverse, global experiences (U.S.A, Europe, APAC).
Master of Human Resource Management from Rutgers University, New Jersey, U.S.A. Recipient of the U.S. Garden State Council SHRM HR Leadership Scholarship.
Bachelor of Technology in Civil Engineering from College of Engineering, Trivandrum, India.
Certifications: MBTI, Hogan, RBL Leadership Code, SHL 360, Team Management Profile, NeuroLeadership Results & Team Coaching.
Facilitated coaching sessions, workshops and programs for Nokia (Helsinki, London, Berlin, Global/Virtual), Rio Tinto (New Delhi), QuEST Global (Global/Virtual, Bangalore, Kerala), Matrix Partners India, Women Inclusive In Technology (India).
Mission: Enable healthy, purposeful, and impactful organizations, through leadership knowledge and wisdom.
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