Tag Archive for: ethics

In Defense of Honesty

/2 Comments/in /by

Drama is worthless except for those who profit from it.  Find your best, graceful, honest self…and bring it.

I’ll just start with this:  I tend toward an idealistic world view.  I believe in establishing and testing core principles and doing my best to live by them. I launched a firm based on that.  I’m not perfect, and I’ve been around the block enough to know that a principled world view is one that can be dangerous to one’s career and to one’s reputation–even when principles are otherwise “right.”

It’s a little acknowledged fact that, as a western culture, we applaud and crowd around feats of physical courage.  We love people who “put their life on the line” and laud them accordingly.   People who are physically courageous might face questions of why they take such risks, but such risks are appreciated.  We saw this recently with a few U.S. citizens who stopped what might have been a much worse shooting incident on a train in France.  We laud them, rightfully so.

On the other hand… Moral courage is actually a very lonely thing.  The courage to stand on principle in the face of really rotten circumstances, to give up power, prestige, or even (gag!) money to have the ability to sleep well at night is…to put it bluntly…tough.  Why?  Well, it usually has to do with a matter of reflection.  When we are morally courageous, we cause other people to reflect on their relative lack of courage.  It’s easy for an individual to look at a selfless feat of physical courage and say “oh, my, I don’t think I could ever do that” and still maintain a solid self image. Change the circumstances to one of moral courage, and people are suddenly confronted with their own foibles more directly.

For the average person, It might be hard to put one’s self in harm’s way to save someone from being shot or run over by a car, but it’s (conceptually) actually pretty easy to walk away from an unethical leader.  However, throw in a bunch of other people following the same unethical leader, good money, and good old inertia, and the person who opts out of such a circumstance has to foster a lot more courage (again, conceptually) than a person who saves the damsel in distress.

Wait, do you mean that it’s harder to be morally courageous than to be physically courageous?

Yes, of course.  If such weren’t the case, we would see a lot more instances of whistle blowers and conscientious objectors vs. physical heroes.  We would see fewer instances of closed ranks, cloistered leaders, and silent exits of key executives. Instead, whistle blowers and conscientious objectors know that they can be vilified, ostracized, and ultimately damaged by the very act of calling out issues.

On a more micro level–one that I hope affects us all vs. the more macro issues faced by whistle blowers–if we saw more flexing of moral courage, we would see a lot less drama in the average group endeavor.

Why?

Because the core of moral courage is honesty.  It’s bringing your best, honest self to bear on any situation.

Drama typically ensues in organizations when there is ambiguity, passivity, apathy, and manipulation.  Drama, true to the metaphor, comes as much from what is happening behind the scenes as on stage.  And, believe you me, there are predatory minds that relish the ability to foster drama and discord.  They thrive on it.

So, my point:  If we are to flex our moral courage, we have to start practicing some level of honesty.  Honesty with ourselves is where it has to start.  Have we examined ourselves, our lives, our professional approaches?  The average human mind (and ego) really doesn’t do that well.  And, make no mistake, we are, on average…average.

Honesty with others is the next step.  Have we offered up, in careful but clear terms, an honest appraisal of situations and the mindsets around us, or do we let drama stir?  Have we examined our relationships in this manner?  Have we been willing to say “no” to those who foster discord? Keep in mind that it is possible to be honest without being brutal.  Most corporate jerks I know are “honest” on some superficial level, but they are also absolutely brutal at it.

Honesty requires grace, and honesty without grace is brutality.

Some might wonder why “honesty” rises to the top of a blog that is ostensibly about leadership and strategy and organizations and transformation.  I’ll just put it this way:

If you can’t be honest with yourself and those around you, you can’t be an effective strategist.  Drama–and the dishonesty underpinning it–obfuscates.  It creates ambiguity.  It creates friction.  It creates frustration.

I’ll say it again:  I’m an idealist. That means, for instance, that I don’t mind being called naive while acting in defense of honesty.  I have found that defending an honest point of view helps the predators and pretenders to reveal themselves for who they are much faster than if I play along.  I sleep well at night.

Bring your best honest self to the situation, and see what happens.  You might not like the reaction, but I guarantee you will like the outcome.

 

The Pain of Virtual Leadership

/0 Comments/in , /by

We all talk a big game.  It’s what we do when the chips are down that shows the kind of leader we are.

In case you missed it, today fed us an interesting anecdote in the world of fast growing companies.

Lauded startup Zirtual, a darling of the flexible work scene, announced that it was “pausing operations” in a terse and terminally unfunny email from founder and CEO Maren Kate Donovan delivered to customers just after 6am ET today.

“I realize this news comes incredibly fast and I am truly sorry for the Z-shaped hole this will leave in your lives and business.”

The Z-shaped hole?

Yes, that was in the letter to customers.

Now, the impact on customers of a sudden and absolutely unforeseen shutdown of a key administrative service is tough.  But, what about the impact on the more than 400 employees Zirtual had?  Of course, they knew.  Right?

Wrong.  Zirtual’s assistants found out by being locked out of their email accounts.

Yes, that’s right, the company folded and didn’t tell its employees until afterward.

So what?  Right?  Happens all the time.

Well… Sorta.   This one comes with a lesson.

It’s a lesson called: Don’t let your mouth write checks your character won’t cash.

To wit:  just 21 days ago, erstwhile Zirtual CEO Maren Kate Donovan wrote an article titled “How to Manage Chaos during a Company Shakeup” in Fortune.  Here’s your link.   It’s juicy with “you gotta be kidding me” quotes.   Such as:

“My team is without a doubt my biggest asset, which is something I never take for granted. So it’s vital to keep them in the loop during periods of change and consistently show support. Because what my employees don’t know could ultimately hurt the entire business. The sooner your team knows about upcoming shifts in the company—the better.”

Yeah.  She wrote that.

And…In a section titled “Don’t worry about your image” she drops this whopper:

“Oftentimes being honest about your own uncertainties in tough times relays a stronger message than being stern.”

Now, thanks to an early career stint at a venture-lending operation, I’ve witnessed the pain of a company shutdown in a few (perhaps half a dozen) instances and actually liquidated one. I understand the pain. I do not write this to stomp on a company that obviously has just imploded for some as-yet-to-be determined reason.

I write it because of one reality:  We all talk big.  Some people with big platforms and bullhorns talk the loudest.  They talk the loudest about being “reassuring” and being “vulnerable.”

We all talk big.

But, when the chips are down, all the big talk is useless.  It’s how you act when you are in the worst of circumstances that defines your (and my) character.

In good times, it’s easy to write for Fortune about your warm fuzzy leadership style.  Rarely is such commentary revealed to be hooey so quickly as in the Zirtual case.

Maren Kate Donovan doubtless has had a bad few days lately.  And, I’m sure there will be more written about Zirtual over the coming weeks as the facts of a 400+ employee company abruptly imploding comes to light.

Still, it’s a case study in failed communication; and a case study in faux leadership.

 

How To Salvage Sunken Trust

/2 Comments/in , , /by

You can salvage trust that is sunk. But some kinds of trust sink deeper than others.

Have you ever faced the need to recover from breaking trust?

Most of us have, and the ones who haven’t just haven’t admitted it. All of life is a web of trust, and arguably the more trust you build, the better off you are.

The author L. Frank Baum wrote in The Wonderful Wizard of Oz that “A heart is not judged by how much you love; but by how much you are loved by others.”

Trust likewise ought to be judged not by how trustworthy those around you are, but by how trustworthy you are.

If you think about trust as a ship at sea, then it’s easy to envision how breaking trust essentially sinks the ship.

But, not all breaches of trust are the same. How far must you go to salvage it?

There are four depths that breaches of trust sink to, and our ability to salvage trust depends on how deep it’s sunk.

The Trust Equation

I’ll start with an illustration that is not my own, but provides a useful context for the discussion. The “Trust Equation” is a very interesting piece from author, advisor, and trust guru Charles Green, founder of Trusted Advisor Associates.

Green, working with co-authors David Maister and Robert Galford in the book The Trusted Advisor, outlines an equation for trust that looks like this:

That is to say, trust derives from how we view others’ credibility (our assessment of what they know)…

…Reliability (Our view of how reliably they deliver)…

…Intimacy (Our level of emotional and intellectual comfort with them) and…

…their Self-Orientation (how selfish we think they or their actions are).

The really cool part of the “equation” structure is the insight that all the “good” aspects of trust are additive, but that self orientation undermines it all. The more selfish you are (or even appear), the more you undermine any trust and goodwill that exists.

Self-oriented people are not trustworthy, regardless of their positive attributes.

I’m going to use the four component parts here to outline the four depths of trust recovery.

The Four Depths of Trust Recovery

Recovery of sunken trust is a lot like recovery of a sunken vessel. It depends on the type of vessel as well as the depth of the water. That said, here are four depths of recovery, and some explanation of what it takes to get there and to salvage it.

1. The shoals of trust:

The shallowest form of trust breach to recover from is related to abuses of reliability. Because it is the most visible, reliability is also the easiest to demonstrate and therefore recover from.

Recovery from the shoals of trust (that is to say, the shallow water) can be as simple as improving on clarity and communication of deadlines. Trust sunk through reliability can be recovered relatively quickly because it’s a shallow recovery. People can see you becoming more reliable.

The shoals are where breaches of trust–like missed deadlines or partially completed work–reside. To be clear, they are a breach of trust. But the individual can regain this sort of trust by changing behavior.

Reliability trust is usually the most flexible of trust types out there.

2. The shallow seas:

The next depth of recovery relates to abuses of credibility. When a person is trusted for what they know and chooses to abuse that trust through posing as something they are not, they abuse trust.

In the professional services arena, we see this sort of abuse far too often. “Experts” in one area might represent themselves as expert in another area. They “fake it until they make it.” This is a sort of trust abuse that can only sometimes be surfaced, and then often too late.

Even though the shallow seas are where trust is frequently sunk, it’s a relatively recoverable area. Most of us respect people who stretch their capabilities and expertise. Most of us are willing to offer a person the benefit of the doubt when it comes to testing their boundaries.

Credibility trust is thus relatively flexible. If it is bent, it can be caused to go back into shape with demonstration of more credibility. Brands do this all the time through credibility-stretching brand extensions (remember chocolate Jello gelatin? How about Dr Pepper Marinade? Yep).

Recovery from this sort of trust abuse means just sticking to or falling back on what works to rebuild credibility. It’s not easy, but it is straightforward.

3. Open ocean:

The open ocean of trust abuse–areas where shipwrecks often stay put–is in abuses of trust related to self-orientation. Loss of trust due to selfishness gets into an area that is far less transparent than reliability or credibility, and that makes recovery from a breach of this sort far less likely.

Once someone abuses trust for personal gain, people tend to be wary of working with them again.

Salvaging trust sunk in the open ocean is very tough and takes a lot of time. The magnitude of the breach certainly matters; however, once a person is viewed as self-oriented, trust tends to be extremely hard to build.

There’s a reason that self-orientation undermines all else in the trust equation above.

The open ocean is where shirkers, self-dealers, executives with hidden incentives, and embezzlers reside.

On the lighter side, it’s the realm of the me-monster at your conference table and the credit hog on your team.

4. The Mariana Trench:

The deepest depth of trust recovery–one where recovery is usually impossible–is where breaches of trust that relate to abuse of intimacy lie. This is, and should be, the most brittle type of trust that there is. It is a deal killer, particularly when combined with an abundance of self-interest by the abuser.

Witness the trusted colleague or leader who exercises a highly cynical abuse of an “intimate” professional relationship to manipulate others for personal gain and prestige, and you’ll know how deep the Mariana Trench can be.

The Mariana Trench is the deepest, darkest part of the ocean. Things sunk there are lost.

This is the depth where lie the ravages of trust in cheating spouses and con artists in the long game.

It is the realm of the corporate sociopath revealed only too late.

Breaches of trust which abuse intimacy often take time. They rely on the most basic aspects of human relationships: friendship, common cause, and warmth. As such, the average person may disbelieve when a close friend is abusing intimate trust until it is far too late.

Thus, this type of sunken trust is very tough to salvage.

Intimate trust is like a diamond: extremely hard, often forged through pressure, sometimes exotically beautiful, but brittle…

…once bent, it breaks.

I don’t see a way to recover this sort of trust, but I am open to suggestions.

So what?

Why does this stuff matter?

Because we deal in trust as a currency every day of our lives. We do it in personal and professional relationships. We do it through our brands and our corporations.

I illustrate these four depths only to provide the reader with a perspective on how damaging the breaches of different kinds of trust can be.

If you haven’t noticed it yet, let me put this last: Breaches of trust related to what is knowable and transparent–reliability, for instance–are much easier to recover from than those related to what is concealed and largely unknowable–the selfish or cynical disposition of an individual or a company.

Don’t sink trust, and know when trust is sunk too deep.

I’d enjoy your thoughts and reflections on this topic.

Pardon the Manterruption

/0 Comments/in , /by

Interrupting is just…plain…rude.

A couple of weeks ago at the SXSW conference, an interesting thing happened.

YOUR LINK IS HERE

Google Chairman Eric Schmidt and Aspen Institute CEO (and author) Walt Isaacson were called out for repeatedly interrupting Megan Smith, the U.S. government’s Chief Technology Officer.

The real stinger for Schmidt is that the person who did the calling out was none other than Google’s own Judith Williams, head of global diversity and talent programs and by some accounts head of Google’s “Unconscious Bias Program.”

From the article:

“The incident was a classic example of what Jessica Bennett, writing in Time magazine earlier this year, has dubbed ‘manterrupting’, or the ‘unnecessary interruption of a woman by a man’.”

While I doubt the real usefulness of the word “manterrupting” beyond being an interesting mashup–“interrupting” suffices nicely for all genders–I do think that there is a real lesson here in watching out for known biases.

Not to mention the lesson of watching out for simply rude behavior.  This is especially true for “smart” people or people who believe their position of power affords them the right to interrupt.

Most interruptors (like me at times) might say they do so out of excitement or passion or a “strong personality.”  (By the way, anyone who uses the term “strong personality” without their tongue firmly in cheek is probably somebody watch out for).

The truth is, it’s just rude and impatient.  And, it’s often just a blind spot for those of us who have or do suffer from the urge to interrupt.

The extent of such a blind spot can be shocking. For instance, after a frustrating set of interruptions, I once tested the mettle of a particularly egregious senior executive interruptor to see how far the arrogance of the interruption would extend.

While speaking, I grew to know the interruption was coming, so I chose–once–to just keep talking through it.

I made it about twice the length of this sentence while this person just kept talking before I, finally, relented. It seems that my upbringing wouldn’t allow me to sustain talking over someone for that long–even from the proverbial high ground.

Imagine a full 10 seconds of two grown people talking over one another, and you’ll get a sense of the ridiculousness of the situation. I’m sure the others in the room saw it.

Though I never tested it again, the person’s ability to interrupt and continue interrupting when room wasn’t ceded was a striking exercise of arrogance and impatience.

Don’t be that person!

On this Saturday morning, consider the need to let others speak.

Especially watch out for cultural or gender differences in assertiveness.

As I’ve posted previously (link here), this sensitivity can make your team better, not to mention make you (and me) a better person to work with.

To all those I’ve interrupted:  I’m sorry. I was rude.

Pardon the manterruption.

When Hard Choices are Easy

/0 Comments/in , /by

Sometimes, things we call “hard choices” are easy…If you look at them the right way.

So much is made about hard choices.

I’ve had it posed to me by a few people as I made the decision–with the encouragement of a couple of close colleagues–to set off on new adventures over the past year:

“Wow, that must have been a really hard choice to make.”

Hmmmm…

Well, okay, it came with some anguish because I had fallen in love with the people and mission of the organization that I worked within and had at least partly helped to build and lead…

…but it wasn’t a really hard choice.

The truth is, the segment of society that I live within only faces really hard choices intermittently.

Sometimes, easy choices are lauded too much.

Within the past week or so, a couple of good examples come up.

Example 1:  When moral choices are viewed as “hard.”

Last week, David Boren, former U.S. Senator and current President of the University of Oklahoma, made a decision to shutter the Sigma Alpha Epsilon fraternity chapter at the university and to expel a couple of its members after an almost unbelievable display of racist ignorance was caught on tape and revealed.  Students were filmed chanting a little ditty that invoked not only racist exclusion, but also imagery of lynching.

It was as disgusting as it was unbelievable, and I write this as a middle-aged guy who grew up in the deep south of the U.S.

Boren acted quickly, and correctly.

Reactions were interesting on this one.  People have been impressed with how quickly Boren acted.  Here’s one example (and I emphasize, example… no endorsement or disparagement implied):

Now, this tweet is an honest expression that arises no doubt out of many kinds of frustration with prior examples of foot dragging in the face of such decisions. However, look at the words:  Awe, moral, steadfast.   Wow. David Boren had the easiest moral decision to make.  He threw a couple of ignoramuses who just might be racists off the campus of a university, and he shuttered a student organization that had clearly propagated the chant and the mindset to deliver it with impunity. We are in awe at the morality of his decision because it’s unusual, but shouldn’t confuse that with hard. 

Example 2:  When personal resource tradeoffs are viewed as “hard.” 

Also last week, Google’s CFO, Patrick Pichette, announced his resignation with a candid and interesting memo.  The gist?  It’s time to spend time with family. I get that. I also applaud the tone of the memo. But, it has been, once again, interesting to see some of the reactions to the announcement.

The language:  Honest, refreshing, and heartwarming.

Let’s be clear, the choice to leave a high profile leadership position at one of the world’s “great” companies to spend time with one’s family may be a tough one for a given individual.  But, what we are seeing is simply a guy making a different choice in life.

He has made a fortune as an executive, has watched his kids leave the house, and has had an epiphany that he just might need to allocate his resources (read that: time) differently before it’s too late.

differently

Perhaps, unusually.

But this isn’t a “hard choice.”

We hold up people making “unusual” choices as if they are heroes, and confuse “unusual” with “hard.”

Perhaps these are roads less traveled, but they aren’t “hard” choices in the traditional sense of the word.

What hard choices really are

Hard choices are more like:

– Do I make payroll or pay the bank?

– Should I send my last $20 to the power company or the water company?

– Do I quit my job to take care of my sick relative?

– Do I leave this abusive marriage?

– Do I blow the whistle on corporate or executive malfeasance, or just leave?

– Do I really need to go to the doctor to get this back pain and cough figured out?

– Should I opt for treatment, or for quality of life?

Those are hard choices.

See what I did there? Hard choices are about choosing between two different forms of pain.  There is no clear outcome.  Hard choices come where there isn’t enough to go around, or there isn’t a clear moral, ethical, or [insert standard of judgment here] win.

Choosing between two different forms of pleasure or choosing to do the patently right thing may sometimes be difficult, but it’s not a “hard” or “moral” choice as the implications tend to get noted.

Let’s not confuse the notion of opportunity cost with the notion of making really hard choices.

I write this because I have personally failed in making this distinction too many times.

How this applies to the world of business leadership and this blog…

Somebody reading this is facing a dilemma, and they are posing it as a “hard” choice to themselves.  It might be the dilemma of leaving a toxic culture or relationship, or taking a personal risk to make a big strategic move on behalf of the themselves or a company.

I encourage that person to reflect on the choice in, perhaps, a different way:  Is the choice hard because there is no morally or painfully clear outcome, or is it hard because doing the morally clear thing is simply difficult?  What happens if you don’t make the choice?

It’s important that we avoid confusing clear but painful decisions with truly ambiguous “hard” choices.

This matters in business, and it matters in life.

Piketty, WSJ, and the Grain of Salt

/0 Comments/in /by

Author of Capital in the 21st Century writes a brief clarification. WSJ publishes a disingenuous claim that he’s backtracking.  Lesson emerges.

One of the sensations in the economic world last year (if economists can, in fact, be sensational) surrounded the book Capital in the 21st Century by Thomas Piketty.

If you haven’t read the book, keep in mind that I do recommend it, while I realize it’s not for everyone. Piketty explores historical government data to reach a few very basic conclusions about the accumulation of capital in a market economy.  His main conclusion is that the rate of return on capital typically outpaces the rate of growth of any given economy (which he summarizes with the formula r>g) thus creating a long term wind of accumulation that creates unsettling wealth disparities.  In the book, he also is very clear that the long term wind can easily be overcome by shorter term shocks; and, he refers to the world wars and their effects on old line wealth in Europe as an example.

Piketty’s book implies that, instead of relying on global conflict and political upheaval, it might be better to have a policy answer to leveling wealth disparity.  It’s not a bad idea.  It might not ever get out of the economist’s classroom, but still…

It’s an interesting read; and, Piketty’s proposal of a tax on wealth is actually quite compelling in theory.  It does, however, have a sort of “belling the cat” feel to it when one looks at the world as it is.

However, this article isn’t about reading, it’s about being a discerning listener even when you don’t read.

The case…

This week, I came across an opinion piece in the Wall Street Journal by Robert Rosenkranz.

Here is your LINK to Rosenkranz’s piece.  I encourage you to read it…with a grain of salt (I’ll explain).

In it, Rosenkranz states that Piketty, who drafted and released a paper in December essentially restating his conclusions but ensuring that popular discourse didn’t caricature them improperly, is “backtracking.”

Here is your LINK to that paper (beware the link opens a PDF of an academic paper…Don’t open it if such things burn your eyes).  It’s an interesting read and actually a fine distillation of many of the conclusions of the book.

The issue…

I do not know Mr. Rosenkranz or his profile; but something struck me…To anyone who reads this stuff and has a sense of the backstory, Rosenkranz’s article is fantastically disingenuous.

Mr. Rosenkranz, like so many others with a microphone these days, is depending on the probability that very few of his readers have actually read Piketty’s book.  So, he takes a paper where Piketty restates the fundamental conclusions of Capital and comes up with this (my emphasis added):

“Now in an extraordinary about-face, Mr. Piketty has backtracked, undermining the policy prescriptions many have based on his conclusions. In “About Capital in the 21st Century,” slated for May publication in the American Economic Review but already available online, Mr. Piketty writes that far too much has been read into his thesis.”

He also takes a statement in Piketty’s “new” paper and positions it as a “new” conclusion.  To wit:

“Instead, Mr. Piketty argues in his new paper that political shocks, institutional changes and economic development played a major role in inequality in the past and will likely do so in the future.”

Nevermind that Piketty is simply restating arguments of his book.  Rosenkranz, who doesn’t even link to Piketty’s “new” paper, seeks to discredit the economist by claiming he has “backtracked” and “consigns his famous formula to irrelevance” and that Piketty is “walking back” his views.

Piketty is doing nothing of the sort.  His paper is simply a reminder that the book had a lot of angles and to take only one angle and politicize it would be malpractice.  Unfortunately, Mr. Rosenkranz takes that exact tack.

So what?

Sleight of hand such as that employed Mr. Rosenkranz brings to the forefront a major issue in the popular press today:  The dependence of writers and speakers on the ignorance of their audience.

One need only look at the comments on the WSJ.com article to see that (1) very few people have actually read Piketty and (2) all Rosenkranz really did was engage in an extended ad hominem.

That, my friends, is demagoguery at its finest; and if it’s in the Wall Street Journal, imagine what others are doing.

The lesson on this is not “be a fan of Thomas Piketty” or “Piketty is right.”

I, personally, believe that massive intergenerational wealth is something to beware of. To engage in a little demagoguery of my own:  Any red-blooded American ought to have the same wariness.  

The lesson is that intermediary authors like Rosenkranz can and do distort and attack in order to provoke.  They do so even when the provocation is actually detrimental to healthy discourse.

These distortions happen on all sides of any argument, which, I suspect, is why Piketty felt the need to publish a few pages of “clarification.”

Why Your Entrepreneurs Leave

/3 Comments/in , /by

In large organizations, if board oversight and management incentives aren’t aligned with value creation, entrepreneurial mindsets can and will be crushed by “iron bureaucrats.”

In a recent post, I juxtaposed the decision-making approaches applied by hard core entrepreneurs and those applied by big company executives.  My thesis was that big company execs can learn from the decision making approach applied by entrepreneurs, if only their incentive structures can allow for it.

One reader, Graham Moores, responded on LinkedIn with this comment:

“In my experience the collaboration between Entrepreneurs and Executives is what should be aimed for, when one side does not understand and respect the other, problems will exist.”

This is a fantastic point, and in the ideal world, makes great sense.

If we can couple the entrepreneurial mindset of building businesses and bearing risk with the executive mindset of allocating resources and protecting against downside; all can win.

However, as Mr. Moores noted, the two sides often don’t understand one another; and therein lies the rub…

Why are real entrepreneurs so often bred out of large organizations?

The classical answers tend to be given offhand.  They include that big organizations move too slow, are too risk averse, and are double ungood at listening to new ideas.

These “reasons” tend to imply that large organizations are uncomfortable for people with an entrepreneurial bent.

That may be true…

But…

I’d argue the real reason entrepreneurship is bred out of large orgs is actually rooted in an organizational phenomenon best articulated by science fiction author Jerry Pournelle.  It has been called the “Iron Law of Bureaucracy.”

I’m capturing it from his website, but it has been quoted in many other places.

It reads (with my emphasis added):

“In any bureaucratic organization there will be two kinds of people:

First, there will be those who are devoted to the goals of the organization. Examples are dedicated classroom teachers in an educational bureaucracy, many of the engineers and launch technicians and scientists at NASA, even some agricultural scientists and advisors in the former Soviet Union collective farming administration.

Secondly, there will be those dedicated to the organization itself. Examples are many of the administrators in the education system, many professors of education, many teachers union officials, much of the NASA headquarters staff, etc.

The Iron Law states that in every case the second group will gain and keep control of the organization. It will write the rules, and control promotions within the organization.”

If we replace Pournelle’s well-known government-connected bureaucracies with some generic corporate examples, then you and I can start to see how this law applies to the problem of entrepreneurship and executive management.

It could easily read as follows (to be clear, all edits are my own and I present it only for conjecture):

“In any business bureaucracy there will be two kinds of people:

First, there will be those who are devoted to the goals of the organization. Examples are people dedicated to customer satisfaction, product excellence, and advancing the organization’s reputation among employees, customers, and the community…

Secondly, there will be those dedicated to the organization itself. Examples include executives and administrators who focus exclusively on defending position, avoiding risk, and managing to the letter of all incentives.

It’s plausible to argue that in every case the second group will gain and keep control of the organization.It will write the rules, and control promotions within the organization.”

What this might mean is that instead of large organizations being uncomfortable for entrepreneurial people, they actually become actively hostile to people who want to rock the boat in the name of building value.

The two don’t merely misunderstand each other; they grow to be fundamentally incompatible.

And, since the second group is far more likely to play the bureaucracy game with alacrity, its most senior representatives will eventually call the shots, just as Pournelle’s law states.

They are the “Iron Bureaucrats.”

So what?  Isn’t that just life?

Well, sort of.

As my reader, Mr. Moores, noted, it’s actually ideal if the entrepreneurial and executive mindsets can coexist and collaborate.  We want large organizations to both embrace business building and risk taking while at the same time embracing discipline and risk awareness.

That’s a good strategy.

But how?

Much of the time, this comes down to the inherent bent of the CEO and senior management.  If the CEO is an iron bureaucrat, then entrepreneurs will struggle.

If the CEO is a closet entrepreneur, even within the trappings of a large bureaucracy, then entrepreneurs can thrive.  One need only look at some of the shifts in strategy at bellwether companies like IBM, Apple, Nucor and many others over the years to see the evidence of this factor.

The other factor is the incentive set that is outlined for senior executives.  In a sort of Judo move, boards can take an iron bureaucrat’s best strength (hitting the numbers) and make it work for the long term value of the company by measuring business building activity aggressively.

So, while entrepreneurs are likely to be bred out of large organizations, they don’t have to be.  Through better board oversight (particularly on the philosophical bent of the CEO) and incentive alignment (particularly around business building) the curse of the Iron Bureaucrat can be overcome.

It’s always great to get thoughtful responses on blog posts, regardless of platform; and I hope you’ll add your thoughts here.

 

#TheDress And Leadership Values

/0 Comments/in , /by

People see the same thing in different ways.  It’s important that we never assume our view of the world is the only one…Even when we are “right.”

Last week, a photo of a dress wasted a fantastic amount of time across the Internet.  A simple black and blue striped dress (yes, that’s the color) appears in the photo.

However, people the world over, when viewing the picture, process its colors differently; a significant number see the dress for the colors that it has; and a significant number see the dress as being a combination of white and gold.

Here’s the picture:

What colors do you see?

Here’s a link to a Wired Magazine discussion of why people see it differently.

The dress, or #TheDress, or #whatcoloristhisdress has created quite the sensation.

In my own household, my wife and I see the dress differently.  She is a member of the gold and white group, and I see blue and black.

We had a fun argument about it, culminating in my saying “I’m just glad I see it the right way.”

Her retort?  “The right way, hmmm?”

To which I replied:  “Well, not the right way, but the way it is.”  

That was worth a chuckle, but it sparked a thought; and that brings me to the point of this post:  While “The Dress” sensation is a sort of embarrassment to the collective consciousness, it comes with a lesson…

The lesson

We all see things through our own eyes and hear things through our own ears.

More importantly, we interpret the world through our own interpretive framework…We apply our own values.  They may be values we hold in common with those around us, but they have been nudged and polished by our own, individual experiences.

And, just as the dress shows that something as “objective” as color can be interpreted in highly divergent ways by people who otherwise see the world in the same way, the same is the case with values.

One person believes that a course of action is ethical and right; while another can look at the same situation and see something highly questionable.

Case in point…

In a recent case involving a proposal from one senior executive to another, I had a ringside seat to the abject implosion of a set of previously high performing professional relationships.  Those relationships were sacrificed to a highly inartful handling of  competing interpretations just like the colors in #TheDress.

In this case, one person saw the proposal as an opportunity; the other saw it as a big risk.  Mix in a third person who had a vested interest in the deal getting done (indeed, a personal one), and you had a very odd interaction.

When the “risk” side delineated what the risks were, he disclosed his interpretive framework.  He explained why the deal wouldn’t happen on his watch; and he essentially said the dress is blue and black…

But, the other side’s answer wasn’t to say “tell me more” or “let’s explore how to fix it or to mitigate the risks,” or even to acknowledge the legitimacy of a different framework.

It was to say “that’s wrong.”

The dress is white and gold…

…end of story.

There was no indication that an honest investigation of the risks to the deal was a possibility.

There wasn’t even a chuckle and an admission that people can see things differently.

So, what happened?

Eventually, the sides hardened to the point that there was no way for either side to move forward. Add in a touch of ego, a dose of stubbornness, some need to look tough and perhaps a pinch of bullying, and you have the demolition of personal relationships that spanned years in the making.

All because two people couldn’t come together and discuss interpretive differences.

When I shared this shockingly poorly handled situation in broad strokes with my 72 year old father, his response was pretty simple and cogent:

“The risk guy just thought that the other folks had the same values as him…that’s all.”

I think that boils it down.

And that’s the lesson that The Dress teaches us…

There are great perils to assuming that all people see the world through the lens of your values.  They can not only look at the same dress and see different colors, but can also interpret the very same actions in very different ways.

When you have a case like the one delineated above, such differences in interpretation can lead to the destruction of value, relationships, and organizational stability.

It is in how we handle our differences of interpretation that we live out a humane leadership ethic.

On one hand (the dress is white and gold) we can stick to our interpretation, and drill it into others.

On the other hand (the dress is blue and black) we can take the position that we might be wrong, and we can listen, think, and engage on our differences…Not as a posturing move, but honestly.

The measure of our leadership ethic is in how often we do the latter when we hold all the power.

The leadership lesson brought to mind by #TheDress is this:  Unless and until people entrenched in interpretive conflict can listen, reflect, understand, and test reality;  they will never realize full effectiveness.

The Dress tells us that even in seeing and believing, we should be open to testing our beliefs…Even if we think we are seeing the world as it is.

Stanford GSB: Mean Co-Workers Make Sense…

/0 Comments/in , /by

It turns out that modern corporate life is a justification in and of itself for people to be self-interested “jerks”…

While I’m not sure I fully agree (idealist that I am), some researchers at the Stanford Graduate School of Business have studied the phenomenon.

YOUR LINK

The operative passage from researcher Jeffrey Pfeffer, a professor of organizational behavior at Stanford GSB:

“People need to take care of themselves,” Pfeffer says. “They need to stop looking for this mythical Santa Claus that’s going to be nice to them.” To the suggestion that this was a depressing assessment of cubicle life, Pfeffer responded, “what I find more depressing is instances when people misplace their faith and trust in organizations—when people who think their company will look after them meet horrible consequences.”

Amen to the concept of horrible consequences waiting in the wings for those who don’t align the values they espouse with the values that their organization upholds.  Amen to that indeed.

It’s an interesting and quick read, in any case.

 

Leadership That’s Always Winter, Never Christmas

/0 Comments/in , , /by

Icy children’s stories from today and yesterday contain leadership lessons for us all.

I’m sitting here this morning in the aftermath of one of the nastier ice “storms” that we’ve had here in the upstate of South Carolina during my residence in this fantastic region. I use scare quotes around “storm” because I have to admit, I’ve never quite understood the term “ice storm” after living for years in Dallas, Texas and now Spartanburg, SC.

Ice doesn’t really “storm,” it just kind of builds up over time.

Which is actually a pretty cool real world analogy for the topic of this post, so…enjoy.

The benefit of being near joy and wonder…

One of the benefits of having 4 young children is that I get to relive childhood (constantly, some would say) with a grown-up eye on childish things. I get to experience joy, fear, and wonder through the eyes of four developing youngsters.

I also get to see, firsthand, the impact that storytelling has on our psyches, both good and bad.

I’m convinced that the power of storytelling never really goes away. A strong narrative delivered with integrity is just as powerful in helping adults understand and change behavior as it is for children.

it’s just an underused (and sometimes misused) tool.

Sometimes, referencing childish narratives with grown up eyes brings to light some pretty interesting and serious insights that apply to our adult lives.

If you’ve been with me for a while as I’ve dabbled in these posts, you’ve possibly seen my stab at a list of non-business books that business people should read. It’s here.

Number 2 on that rather eclectic and certainly incomplete list was the book Animal Farm by George Orwell.

Orwell was certainly onto something when he built his little allegory of a communist gangster takeover of an idyllic farm. It’s worth another look for anyone looking at social and hierarchical power dynamics in the organizations of today, particularly where there is extreme stress on words like “collaboration” and “teamwork.”

That digression aside, the reality is that narratives, even and perhaps especially those meant for children, have lessons.

I’m struck recently by the leadership narratives brought on by three icebound stories that have permeated popular culture. That they all deal with ice is only the more convenient this morning as I write this…

Three Profiles in Icy Leadership

The three children’s stories that have leadership narratives with icy “teeth,” which I’ll place in ascending “destructive” order, are:

1. Disney’s Frozen

The “leadership” plot: Poor Elsa, afflicted with fantastic powers to create ice and snow at her whim, freezes her entire kingdom. Through the travails of many friends and the schemes of a few enemies, Elsa learns to control her powers and balance them for the good of the kingdom (and herself). The kicker: True love.

The leadership lesson: Frozen is a story of unconscious incompetence writ large. You’ve probably experienced a fantastically talented leader who inadvertently freezes everything around him or her. You may have been one!

This leader creates an atmosphere of fear and mistrust that drives out all action and vibrance. But, this leader is actually coachable in the end.

In my experience, this is the profile of many, many young, smart, driven leaders who step into leadership situations that are challenging. They take control, dictate, panic, and ultimately freeze all the people around them because it’s all they have known over time. Maybe you have personally been here…

How to solve it: The key to the “Elsa” leader is to turn unconscious leadership incompetence (essentially a lack of self awareness around others who don’t have his or her powers) into conscious competence through coaching, feedback, and repetition.

Most organizations have a few Elsas in their midst. They need to be nurtured and coached, or else they progress toward our next to profiles.

2. Hans Christian Andersen’s The Snow Queen

The “leadership” plot: The Snow Queen, a story from 1845, was a very distant feed-in to the plot line for Frozen. “Very distant” meaning that the stories lack resemblance to one another.

Interestingly, the Snow Queen’ leadership foibles fall somewhere in the middle of the three vignettes here. The Snow Queen is a necessary and fantastically talented leader, being the leader of the hive of bees that bring snow to the world.

She, however, chooses to enslave a young boy who has been accidentally afflicted with splinters of glass from a magical mirror that freeze his heart and pollute his eyes–causing him to have affinity for the cold queen, to see the flaws in all that is beautiful, and to see all that is awful in an amplified way.

The Snow Queen takes the boy, whose heart is already cold, and freezes him further. The boy, blinded by his affliction, is pleased with her. The Snow Queen maintains her grip on the boy by telling him he can have his freedom once he completes a relatively simple task (spelling “Eternity” with shards of ice) that he just…can’t…figure…out.

Eventually the boy is freed by the love of his best friend, who warms his heart, washes away the splinters of glass, and lets him see the world, and the Snow Queen’s leadership, as it is.

The leadership lesson: The Snow Queen is a purposeful leader who has chosen to entrap a young soul for her amusement or benefit. You may have encountered this type in your experience.

The leadership lesson in this one is that individuals should be asked to serve to their highest ability, not to the whim of the leader. The Snow Queen leader doesn’t get this, and instead wants his or her followers to think they are in the best position they could possibly be in while he or she dictates their career.

How to solve it: Because these three vignettes are a progression from least bad to worst, this one is a bit tougher than the first. Most importantly, followers need to be willing to test whether their leaders are creating win-win career situations, or merely playing people into roles that are advantageous to the leader. On the leader side, having a few strong sounding boards outside of his or her organization can prevent the tunnel vision that results in pigeon holing people and getting less out of an organization than is possible.

All of this, of course, pales in comparison to the next profile…

3. C.S. Lewis’ The Lion, the Witch, and the Wardrobe

The “leadership” plot: Because the book is a Christian allegory (and quite a good one), most of the leadership focus in analysis of The Lion, the Witch, and the Wardrobe is on the Christ figure, Aslan the Lion. Since none of us is going to have the power that Aslan had, I’d propose the real leadership lesson comes from the reign of Jadis, the White Witch.

The White Witch presides over a Narnian kingdom where she has commanded it to be endlessly winter, while at the same time purposefully preventing Christmas from ever coming.

Thus, in the kingdom, it is “always winter, but never Christmas.” In the precise brilliance that is C.S. Lewis’ writing, this phrase sums up so many leadership regimes in so many companies and institutions.

The White Witch is a terror. She is evil. She is enabled by an entourage of characters who have her back. She puts a bounty on any human who enters Narnia, effectively enlisting the entire population not against threats to the Kingdom, but threats to her own reign. Her most terrifying capability is that she can turn her enemies to stone…She has decorated her castle with statues formed of people who chose to dissent or disobey.

The leadership lesson: The White Witch is a leader with a conscious focus on self aggrandizement through a reign of terror. Leaders who fall into this category tend to be those who were not coached or apprenticed in their early years and who happened to be surrounded by and benefit from people that the leader was able to influence unduly as they rose to power. In short, I’m not sure there is a lesson, other than to intervene before the White Witch becomes the White Witch.

How to solve it: Leadership change tends to be the only way to overcome a charming but consciously vindictive and well protected leader. Usually, like in the story of The Lion, the Witch, and the Wardrobe, it requires outside intervention (sometimes, ironically, resulting in the “demise” of the intervener). Bosses, boards, and peers have to identify the leader by virtue of his or her cultivation of a menagerie of henchmen and a garden of noble stone statues.

I hope you never encounter the corporate equivalent of the White Witch.

What’s the big deal?

So, why take an hour and a half of my day to write this? Well, first, the ice storm allowed it. That’s a picture of the deck outside my home office you see at the start of this article.

It turns out that having an open moment on the calendar is a fun thing when one of your hobbies is trying to push to a higher level of strategic and business leadership understanding and discourse (yes, I’d enjoy your comments).

Second, I think the lesson I’m writing on this morning is that the intersection of power and responsibility is real.

All of these leaders were fantastically powerful and talented in a raw sense.

The first type, the Elsa leader, has no idea that her power can freeze the world around her if she is not careful; and she has to learn.

The second kind, the Snow Queen leader, can only break out of icy habits by understanding that the people she leads should have an informed say in the matter.

The third kind, the White Witch leader, is in most cases a lost cause, polluted by power and ossified by suspicion and paranoia. She needs a re-set.

Though they are all powerful, these leaders’ senses of responsibility move steadily from outside themselves to inside themselves. There’s a point to reflect on in that reality.

Our children get to experience stories of wonder and consequence. Sometimes, it’s good that we revisit them as adults to understand that the authors of these stories–in most cases adults–were inspired by real, grown up problems.

As I mentioned at the beginning of this post: Ice doesn’t really “storm,” it just builds up. Such is the case with leadership profiles outlined here…Hopefully, with a little foresight, we can get good at guiding the budding leaders in our midst away from these particular end points.

May your iciest experiences be preludes to the celebration of Christmas (or the holiday of your choice), and not the harbinger of an eternal blizzard…