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Tuesday, April 24, 2020

Organizational pathology: Why does it matter?

Part 1 of a series on the illnesses of today’s organizational cultures

Most articles produced on the topics of burnout, stress, and overwork approach the problems from the viewpoint of individuals and their choices. There’s often an unspoken assumption that the organizational context is a given: constant pressure to perform, tight deadlines, impossible expectations. From this perspective, the only way to cope lies in changing your day-to-day responses to a crazy world. This series aims to look at stress and overwork from the perspective of the organization and the diseases of its internal operation.
Many of us have suffered under bosses who are jerks. Their tantrums, callous disregard for others, pompous self-importance, arrogance, and obsessive ambition were the background to our daily lives—and the immediate source of most of the stress and frustrations of the job. But were they born this way; or did something in the organization itself make them jerks?

In an individual case, either or both of these questions might deserve to be answered “yes”. Many bosses have significant personality flaws that cause them to behave like *ssholes. Others might have been less obnoxious, if only the organizational culture hadn’t encouraged—even forced—them to show the worst side of their characters.

A sick organizational culture is bound to cause problems for all those who work within it.

While dealing with stress and burnout from an individual point of view is both valid and useful, personal lifestyle and behavioral choices are not the only factors involved—nor always the most significant ones. A sick organizational culture is bound to cause problems for all those who work within it. Unless it is reformed, no amount of personal change will do more than act as a temporary Band-Aid to hold people together and keep them functioning despite the poison all around.

Every organization develops a unique character, based on an institutionalized set of automatic approaches to the world. That is what we usually call the organizational culture. Some are benign, others strongly poisonous, but all serve as the background to people’s working lives. A toxic leader in a basically benign culture can usually be held in check. If he or she acts out such character flaws too often or too much, the organization is likely to move to curb the bad behavior. Only silence on the part of those who suffer will mask the problem, as least for a time.

But what of “ordinary” leaders, neither especially good nor markedly bad? What will happen to them . . ?

A good leader in a toxic organization will also find him or herself rejected. Most will remove themselves well before that happens, since the poisonous culture around them will be more than they can tolerate. But what of “ordinary” leaders, neither especially good nor markedly bad? What will happen to them, if the culture around them constantly promotes negative, oppressive, Hamburger Management behavior?

I was interested to note on Bob Sutton’s blog that a newspaper article reviewing the French translation of his book, “The No *sshole Rule,” (“Objectif Zéro-Sale-Con” in France) was titled: “L’entreprise, pépinière de cons...” In English, this means something like: “The company, a tree nursery for *ssholes.”

Sadly, this statement is all too true. Many organizations act exactly like garden nurseries where jerks and *ssholes are grown in bulk. These enterprises cling to cultures that force any good managers to leave, allow bad ones to flourish, and shift the great mass of in-betweens slowly and inexorably towards the dark side.

In the next few days, I plan to review some of the most typical categories of toxic organizational cultures, drawing heavily on the work of Manfred Kets de Vries, a Dutchman who is professor of Leadership Development at INSEAD, the premier European business school, as well as my own experience.

Organizations have lives of their own that impact all who come into contact with them. If the culture that develops internally demands results at any cost, it is inevitable that the organization’s leaders will respond by creating the ideal conditions for stress and burnout: irrational demands, overwhelming pressure, casual cruelty, macho posturing, and suffocating conformity. Since these are precisely the conditions that will also nurture the greatest concentration of jerks, the management class of such an organization will rapidly teem with *ssholes of every type.

Organizational problems demand organizational solutions. You cannot expect personal change, however good in itself, to have much impact. That’s why Slow Leadership requires more than individual development. It requires that organizations themselves understand how counter-productive and negative their behavior may have become. They too have to admit to being *ssholes.



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Thursday, April 19, 2020

Getting it wrong to get it right

Organizations (and people) who are afraid to make mistakes can neither live nor learn effectively.

Yesterday, I wrote about Professor Russell Ackoff’s interview with Peter Day, reported here on the BBC web site. In the second part of that interview, the topic shifts away from business schools towards another key question: how can you be successful if you ignore, or hide, or deny your mistakes? Aren’t mistakes the basis of virtually all learning? If you don’t learn from them, who or what will be able to teach you anything?
It sometimes seems that our society is obsessed with prying into the mistakes of others, but that isn’t really true. The media have a prurient fascination with the mistakes of the rich and famous—especially any that involve sex—and there are many who take an equally perverse joy in proving to themselves that those whom they secretly envy are, in reality, no better then they are. Yet the greatest effort goes into hiding mistakes, or denying their very existence, as if making a mistake were the most shameful of social diseases. Politicians, business leaders, the rich and famous, all spend lavishly on covering up their mistakes.

Our society's petty and mean-minded ways of dealing with mistakes, focused as they are on pointing to others’ misdemeanors, while carefully concealing or ignoring your own, are so common that we scarcely notice any more. Sadly, this is also the way that mistakes are treated in most organizations: as something to be ashamed of, to punish, and to conceal or deny whenever possible. Listen to Professor Ackoff:
You never learn by doing something right, because you already know how to do it. The only opportunity for learning is to identify mistakes and correct them. If you are in an organization which says that mistakes are a bad thing, learning is suppressed. So you either try to avoid mistakes, or if you make them, you shift blame to someone else.
The simplest way to avoid mistakes is to do nothing; or at least to do nothing new or different from the conventional. If you resolutely stick to whatever is the most obvious, the most orthodox, and the most common, you at least have the chance of deflecting criticism by the time-worn practice of pointing to everyone else and saying that they did the same. As Ackoff points out, organizations have elaborate measurement and recording systems to note even the slightest sins of commission—doing what you ought not to have done—and none at all to deal with the worst kind of mistakes in business: not doing what you should have.
The worst kind of mistake is not being wrong, but something you did not do that you should have done. Errors of omission are responsible for failures and bankruptcy.
I think that he is right about that. Following the herd and sticking to the conventional and orthodox makes you mediocre and pedestrian, but it takes a long time to bring your business to its knees. Missing opportunities, ignoring mistakes, staying complacent in the face of change, and suppressing new ideas will all ruin you faster and much more effectively.

Yet that is what so many organizations are doing. They’re so hell-bent on imitating others and avoiding risks that they take the biggest risk of all: ignoring reality.

Choosing to stay the same is a choice with as many consequences as choosing to change in some way. One merely feels more active than the other.

Deciding not to do something is just as much a decision as its opposite. Choosing to stay the same is a choice with as many consequences as choosing to change in some way. One merely feels more active than the other. In reality, both represent an equally significant response to events. If one is punishable, so should the other be. Of course, honest mistakes—those made despite every effort to get it right—are no more worthy of being punished than getting wet when it rains. Life is unpredictable and often cruel. Only the dead are free from further errors.

To learn fully from your own mistakes, you should make as careful a note of when you decided not to act as when you did. Refusing to act is still your choice, and you should trace its consequences carefully. If you don't, at least half the lessons life can teach you will never be recognized. Sometimes the greatest gamble of all is to refuse to throw the dice.

In my own experience, as you get older, you spend far more time aware of all the opportunities that you didn’t take, and the things that you didn’t do—and now wish that you had—than regretting the mistaken actions or choices that you did go through with. Though you know that many of those missed opportunities would not have worked out—that you would have suffered hurts you avoided and much pain and embarrassment—you become aware of what you have missed that was far more valuable: experiences that would have taught you lessons that now you can never learn.

Getting it right, in work or life, nearly always involves a great deal of getting it wrong as well. Success depends critically on how you face up to failure, take the lesson it offers, and start again. Opportunities missed are usually gone for ever. The road not taken never shows up on the map again.

That’s why rushing through life, obsessed with conventional success and fixated purely on material gain, may produce riches and fame, but very often misses out on happiness and contentment. The New Testament of Christians asks: “What shall it profit a man if he gains the whole world, yet loses his soul?” You only have one trip around the sun. Use it well, or lose the chance of living and learning forever.



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Tuesday, April 17, 2020

Antidotes to Hamburger Management

How to rid yourself and your organization of poisonous management.

Hamburger Management is management based on always doing whatever is quickest, simplest, and (above all) cheapest. Hamburger Managers provide the kind of leadership that is best described as: “Never mind the quality, look how fast it goes, and how cheap it is.” Sadly, this approach is being forced on a great many otherwise perfectly reasonable and responsible people by the continual demands of those at the top to meet inflated expectations of short-term profit. If you have been forced in the past into Hamburger Management approaches, can you find a way out? Are there antidotes to purge you of the poison? There are. Here are some of the best.
Is there hope for Hamburger Managers? Can they go to re-hab, like politicians and media stars, to be returned to society as reformed characters? Is there a de-toxification program? Indeed there is, and it doesn’t need you to stay in some remote resort or engage the services of a shrink. Let us reveal all.

One of the best antidotes to Hamburger Management is kindness in leadership and business dealings. That was the basis of my article: Is the Worm Turning? Macho, grab-and-go management styles, like Hamburger Management, are universally callous towards anyone who gets in the way of creating maximum (personal) profit in minimum time. In a civilized society, that really ought to be intolerable. If your words and actions are always marked by kindness, you cannot fall into Hamburger Management ways. It’s not possible. Be kind, always, and you’ll be free of the poison at once.

Check your ego at the door when you arrive each morning. I’ve long held the belief that the best way to “inspire” bosses to act in civilized ways would be to make any other behavior socially unacceptable. Nothing would change hearts and minds quicker that the prospect of being ostracized at the golf club; or no longer being invited to dinner by the “right kind of people” in the locality. Egotism is an intrinsic part of Hamburger Management. These macho management styles are sold to people on the basis that getting things done, even when it all seems impossible given the limited time and resources, will make you look good. And egotism is all about me, isn’t it? My career, my targets, my job security. If, instead, what you experienced was being shunned by all reasonable people, no one would stick with Hamburger Management for a week.

In a past posting called Take Any Two From Four . . ., I explained that work can be quick, cheap, innovative or good—but you can only have two of those qualities at any one time. Good, innovative work isn’t going to be cheap or quick, because it takes time and resources to break away from the dead hand of conformity. Quick, cheap ways of doing business (the hallmark of Hamburger Management) more or less ensure that the work done won’t be good (too expensive) or innovative (too slow and risky). That’s how good businesses go downhill, by focusing on short-term profits instead of lasting value. To remove the poison of Hamburger Management from your systems, as well as your own approach to leadership, make sure that you concentrate on long-term approaches whenever you can. Sort-term actions should flow from long-term strategies, not the other way around.

Hamburger Management cannot exist in the presence of genuine respect for others. The surest way to alienate and demotivate others is to deny them respect. Macho, grab-and-go management does this all the time. People are treated as “human resources:” depersonalized objects that are simply costs, tolerated only as long as there is no cheaper alternative. If you can do without them, fine. If you can’t, but can outsource the work somewhere where people will work for much lower pay, also fine—even if those people are little better than slaves in some Third-World sweatshop. The minute you feel that you can find a cheaper way, forget any soft ideas about loyalty to your workers. As Circuit City showed recently, with a Hamburger Management approach you shouldn't waste time considering the possibility that what you’re doing is barbaric and marks you and your business out as *ssholes on a massive scale.

Nothing slows business down more than time spent in pointless meetings, but it’s not the kind of slowing down we advocate at Slow Leadership. Too many meetings have absolutely nothing to do with communicating information—and still less with listening to other peoples’ thoughts and ideas. Here’s a very quick list of the most common—but almost never acknowledged—reasons for holding meetings: If your meetings contain time wasted on any of the above, either drop the meeting altogether (if at all possible) or severely limit the time allocated.

There are only two genuine reasons for holding a meeting:
  1. Sharing information when you are willing—and able—to answer any questions immediately; and when the subject matter is such that large groups of people need to get identical information at the same time.

  2. Situations when you are willing to seek genuine ideas, thoughts, and feedback from the participants and listen to what is said honestly and with an open mind.
Meetings held for any other reason are a waste of time and are likely to be due to a slide towards Hamburger Management.

Instead of cluttering up people’s time with silly meetings, constant phone calls to “check progress,” foolish demands for progress reports, and other childish activities based on your own suspicions and fears, why not try trusting your subordinates to do their jobs? Give them the space, time, trust, and support to make it happen. If more corporations tried that approach, I believe they would discover they have plenty of time to get everything done, without all the stress and long hours. All they need to do is to free themselves from pointless reporting, useless meetings, the collection of meaningless statistics, petty rules, the preparing of endless PowerPoint presentations with justifications for any and every minor action, and all the other common means of covering those so-delicate executive butts.

Good business is not about being quick, simple, or cheap. It’s about being better at what you do than anyone else. And that includes service, quality, and innovation too. That’s why Hamburger Management is ultimately self-defeating. Rushing, cutting corners, compromising quality and innovation to get quick profits, sacrificing long-term success for short-term gratification, strutting around like an oversized rooster, feeding your already-inflated ego, and pretending that you are John Wayne are the marks of an immature mind and a crippled personality.

That’s not business, it’s personal display, like a stag at the rutting ground. Save it for trying to impress other gullible idiots. The rest of us already think you’re a total jerk.



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Friday, April 13, 2020

Whose fault is it anyway?

Making yourself responsible for what you cannot control makes for a miserable life.

Are you accountable for your actions—or responsible for the results? Can you be held responsible for making something happen—or only for the way that you try? Get the answer wrong and you’re setting yourself up for a good deal of unnecessary stress and anxiety. Sadly, Hamburger Managers habitually confuse accountability with responsibility, especially when it comes to pressuring their people to serve up unrealistic targets. It sounds tough and practical to say that winning is all that matters, but it’s still nonsense. No one can control events or outcomes, not even today’s ultra-macho managers. Yet many are half-killing themselves by trying.
Yesterday, I wrote about the negative role played by an overdeveloped ego. Now I want to consider a related issue. Many organizations and executives treat accountability and responsibility as the same. More demand specific results and state that someone or other is being held responsible for getting them. By doing so, they’re causing stress and confusion on a large scale. Keeping the meaning of these common terms clear is essential for proper leadership; as is understanding what someone should rationally be held accountable for and what they certainly should not.

If you’re accountable for something, it means that you are the person who is liable to be called to account for progress, success, or failure: to “give an account” explaining what happened, what you did in response, and why. It doesn’t mean that you need to do everything associated with that project yourself. Nor that success or failure ultimately depends on your actions. Most of what happens in the world does so by chance, or due to such a complex tangle of causes and related effects that it is impossible to determine the exact reason (if there was one). To be accountable means that you have to answer for your actions (or lack of them). It does not mean that you should be blamed for every failure or congratulated for every success. Most have nothing to do with you. Whatever you did had no effect on them.

This is tough for many people to accept. As a species, humans like simple, clear causes that produce obvious effects. Our brains are programmed to try to find them. The human sub-species that works in the media is especially prone to inventing simple reasons for every event. You need only listen to the pundits discussing the day’s trading on Wall Street to hear an impossibly complex set of global financial interactions reduced to some bland statement that trading was up or down due to something simple, like a speech, one set of figures, or “nervous investors.”

To be responsible for something is generally understood to imply that you—and whatever you did or left undone—were the direct cause of whatever happened. It’s all down to you to control people and events to bring about the desired result.

Thinking like this is giving yourself ludicrous airs, but the ego loves it. It puts you right at the center of events. It makes you important, critical, essential to success. Egotistical Hamburger Managers typically make this kind of claim, pointing to positive outcomes and saying: “I did that.” But if you’re the cause of the good things, you have to be the cause of the bad ones too. Now that’s not so nice. Of course, people are quick to attribute failures and messes to others, to unexpected events, and to simple chance. All true. But if the failures are down to chance most of the time, won’t the successes be due to the same random combination of events?

Smith is responsible. Blame Smith. Quick, clean, simple. And wrong, in the vast majority of cases.

Treating other people as responsible is also tempting because it sounds tough and makes life simple. If Smith is responsible for sales and sales fall, fire Smith. It’s his or her fault. There’s no wasting time trying to find out what went wrong. No potentially embarrassing inquiry that might suggest others above Smith had some part to play in the failure. Smith is responsible. Blame Smith. Quick, clean, simple. And wrong, in the vast majority of cases.

You can see this attitude all around us. The corporation is in trouble? Fire the CEO (with an enormous golden parachute) and hire a new, higher profile one (with a huge signing-on bonus.) And if things get no better afterwards? Fire the new CEO—then repeat as required.

Does anyone ever reckon up the cost of these repeated restructurings? Or ask why so few of them appear to work? These people may have been accountable for some or all of the business, but they are rarely (if ever) personally responsible for what happened. Firing them is a purely emotional response: a wish to see someone suffer (though the golden parachutes make it the kind of suffering most of us would love to volunteer for!). It has no logic to it. What’s needed is to take the time to find out, if possible, what the real problems are and correct those.

If this was only about fat cat executives, most of us would find it tough to care. Sadly, it applies at all levels. Bosses hold subordinates responsible (not just accountable) for all kinds of events outside anyone’s capacity to influence. Worse still, people hold themselves responsible: accepting the blame for past failures and tormenting themselves with guilt and regrets.

I wince when I read nonsense like the idea that each of us is somehow responsible for what happens in our lives, probably through some magical psychic transference. It’s total rubbish. We are accountable for our actions—always—but we cannot affect large parts of what happens in our lives and careers in any way. All we can do is react to events as sensibly as we can.

It’s time to leave behind this childish, simplistic view of cause and effect that owes more to superstition, revenge, and primitive religiosity than any logic.

It’s time to drop the silly, Hamburger Management nonsense that claims people must take responsibility for events that are wholly, or even partly, outside their control; time to leave behind this childish, simplistic view of cause and effect that owes more to superstition, revenge, and primitive religiosity than any logic. Superstition believes that unrelated events effect one another (the stars and events on earth). Lynching someone because bad things happened is the response of a primitive society. And there’s no evidence to suggest that the gods, let alone a supposedly loving God, spend their time messing up peoples’ lives as punishment for various sins.

By all means let us hold those in positions of power accountable for what they do—sensible, stupid, or corrupt—but forget feeding their egos (and our desire to hit back) by pretending that they are personally responsible for every outcome. Luck plays a huge part in the career of every successful person. Few executives, even CEOs, have much personal power to do more that torment their subordinates.

Stand back, slow down, and accept that most of life’s problems will take careful exploration to understand properly. Action without understanding is foolish. But then, Hamburger Management is the most foolish approach of all.



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Monday, April 09, 2020

Workplace “black holes”


Some workplaces are like black holes, sucking in all the energy around and giving nothing back.

Have you ever walked into a place of work—an office, a laboratory, a school, a retail store—and felt your spirits start to flag the moment you passed the door? Felt a kind of weight settle on you: a sense of dullness, gloom, coldness? Experienced trying to deal with people who seem disinterested, uninvolved, too distracted, or too sluggish to do more than the absolute minimum? If so, you’ve just encountered a workplace “black hole.” A phenomenon that becoming more common than it ought to be.
In space, a black hole pulls in all energy, but never lets any back out. However much energy is nearby, it will be pulled into the vortex and then disappear as if it had never existed. A black hole is insatiable. It keeps pulling in more and more energy, absorbing it—then drawing in yet more. In black-hole workplaces, effort, however successful or exceptional, is absorbed as if it had never existed and “rewarded” by demands for still greater effort. Good results are automatically seen as the basis for requiring further and better ones. Achieve your target and it will be instantly increased. Exceed your target, and the bar will be raised still higher Like the real black holes in space, nothing can fill up a black-hole workplace—or even slow down the constant demands for more and more.

All that energy, effort, and hard work goes in, but nothing comes out again. Black holes absorb, they never emit. Black-hole workplaces take all you have to offer—and more—and give little or nothing back. They see payments and benefits as evils to be minimized, training or development as unnecessary costs, and staff numbers as a figure that should always be on the way down. Working there is a grim, draining experience: all work and no play or respite. That’s why staff appear so sluggish and disinterested. They’re too beaten down and exhausted to behave in any other way. In most cases, their every move is watched and their every activity measured against constantly rising targets for individual or team output.

Instead of being respected as a person, you are talked down to, looked down on, distrusted, and treated as a “human resource.”

At the root of the workplace black hole phenomenon is a deep disrespect for people. Employees are expected to focus totally on getting their work, with no time for themselves or “slacking off.” Targets are raised and raised until they become impossible—then raised again. Failure to achieve whatever is demanded is punished. Success is not appreciated, since it is seen as no more than doing what you are paid for. Instead of being respected as a person, you are talked down to, looked down on, distrusted, and treated as a “human resource.” Something to be used and exploited: a cost to be minimized or, if possible, removed altogether by mechanization or outsourcing.

Of course, such organizations disrespect their customers just as much as their employees. The customer is there to be fleeced, manipulated, misinformed, and given as little as possible for his or her money. Price gouging, cartels, and profiteering are all the result of this fundamental disrespect of others.

Fortunately, our universe has stars as well as black holes, and the same is true of the business and organizational world. An organization that is a star energizes everyone who comes into contact with it. Instead of absorbing energy, stars create it. They don’t just respect and honor everyone involved, they give back far more that they take. For the people who work there, it’s a marvelous place that allows them to be themselves, express their creativity, build a career that they can be proud of, and—above everything else—have fun. That fundamental trust and respect of employees and customers shines through like light from the brightest star. If you need help, it’s given with pleasure and care. Employees clearly show that it’s a pleasure to work there, and that communicates itself to customers too. Black holes de-energize their whole environment. Stars pour out energy that lights up a wide area around.

is your workplace a star or a black hole? Is it founded on respect and trust—or disrespect, suspicion, and exploitation? The only sensible way to deal with a black hole is to get as far away from it as possible, before it sucks you dry. Whatever lurks, unseen, at the center of its vortex will go on drawing in energy, work, profits, effort—endlessly. An economy based on multiple black holes will suck energy and money from everywhere else and return nothing. A country based on black-hole organizations will try to suck the rest of the world dry.

We’re constantly exhorted to reach for the stars. In the organizational world, that makes excellent sense. There are stars out there. If you can find one to work in, you’ll find that every working day brings you more energy and fun. Why accept anything less?

Just stay away from the black holes.



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Wednesday, April 04, 2020

The right direction for civilized work

Mutual respect, not macho posturing, is the true basis for business success

Business has no room any more for the kind of short-sighted, closed-minded autocrat who sees people as merely “employment units,” to be bought as cheaply as possible and used with ruthless disregard for their welfare until they are replaced by others, fresher and less wounded. That’s how plantation owners treated their slaves 150 years ago. It was a disreputable way of operating then and nothing has changed to make it any more acceptable. Isn’t it time that we demanded better from our business leaders? Isn’t it time that they stopped destroying wealth by clinging to outdated leadership notions and came into the 21st century?
On Sunday last, Bob Sutton had this to say on his blog:
Today’s New York Times has a glowing review of True North: Discover Your Authentic Leadership, by Bill George (Former CEO of Medtronic, a Jim Collins “Good to Great” leader, and now a Professor at Harvard Business School teaching leadership), with help from Peter Sims. The book is based on interviews with 125 other leaders and executives like Starbuck’s Howard Schultz and Xerox’s Ann Mulcahy. These cases—in combination with George’s accomplishments—show that leaders who create humane organizations that really care about their people and their customers—and don’t just view them as units that exist for the purposes of extracting “as much economic value as possible” every minute of every day—not only can thrive financially, they do it in such a way that people can travel through their days with dignity [My italics]. And as George shows with his cases of successful leaders, they can also have a life outside of work.
For years, management orthodoxy has been based on the idea that the key to business success lay in controlling costs, especially the costs of employing people. Employ as few people as possible, pay them as little as you can, and work them as hard as you can get away with. And if employment costs and laws in the developed world are becoming an issue, ship the work to somewhere in the Third World, where workers will accept a pittance and there are few, if any, laws to regulate corporate behavior.

This is the orthodoxy that has created Hamburger Management. Bob Sutton, along with Bill George and many other successful leaders, are doing us a marvelous service by pointing out how foolish and short-sighted it is. As a business creed, the “minimizing costs is everything” school leads to management barbarism, contempt for customers (think of most airlines today), and fat-cat executives caught out in dubious schemes and ethical blunders of all kinds. It’s the thinking behind companies firing experienced staff and replacing them with cheap newcomers. And it doesn’t only stink as a way of handling employees, it’s bad for business.

According to Management Issues:
. . . a study by insurance and financial services company MetLife has found that keeping key workers happy, challenged and motivated is becoming more important to U.S businesses than controlling costs. Employee retention was identified as the most important priority by more than half of employers overall polled, with retailers (62 per cent) and the service sector (59 per cent) placing an even greater emphasis on the need to retain people.
The conventional cost-cutting, macho, grab-and-go managers are stuck in the past; in a time when employees were mostly interchangeable, whether they shoveled coal, shuffled paper, or handed out goods in a store. Sure, some did the job better than others, but the differences weren’t too great. The job saw to that, since work was mostly fairly simple, repetitious, and could be learned quite quickly.

There are decreasing numbers of jobs that nearly anyone can do quickly, and rapidly increasing demands for the kind of people who are in shortest supply: the most able, the most highly-skilled, and the most inventive and passionate about what they do.

Nearly all those jobs have already been swept away by machines and computers. Even the job of a foot-soldiers in today's armies takes considerable training. That's why few, if any, generals are in favor of the draft: they have little need for large numbers of untrained, unwilling recruits. By the time draftees were sufficiently trained to be useful, their draft period would be over. Business is no different. There are decreasing numbers of jobs that nearly anyone can do quickly, and rapidly increasing demands for the kind of people who are in shortest supply: the most able, the most highly-skilled, and the most inventive and passionate about what they do.

What’s left is mostly professional work, demanding extensive skills, high intelligence, and (if you are to beat the competition) creativity and ingenuity. To be good, people need considerable training. You can’t lose them and pick someone up on the street tomorrow as a replacement. Professional staff replacement is expensive, chancy, and creates a drag on the business that no one needs. In the same article quoted above, another survey is mentioned, covering 11,852 employees. It found more than 60 percent of employees were planning to look for a new job in the next three months, nearly double the proportion that employers believed were looking.

I’ve been arguing for a while that managers and leaders who engage in Hamburger Management aren’t just jerks; they’re actively harming the businesses that they work for.

There has been a saying around for many years that, if you pay peanuts, you get monkeys. Today, if you treat people like sh*t, they leave; and the only ones you’ll get to replace them will be out of the door too, as soon as they find that the fine words of recruiters aren’t matched by actual experience. Patricia Soldati quotes The Conference Board to assert that:
. . . employee engagement is a very big deal. There is clear and mounting evidence that high levels of employee engagement keenly correlates to individual, group and corporate performance in areas such as retention, turnover, productivity, customer service and loyalty. And this is not just by small margins. While differences varied from study to study, highly engaged employees outperform their disengaged counterparts by a whopping 20 – 28 percentage points!
I’ve been arguing for a while that managers and leaders who engage in Hamburger Management aren’t just jerks; they’re actively harming the businesses that they work for. It’s nice to have some proof from a highly reputable source like The Conference Board.

Uncivilized modes of leadership destroy wealth, as well as destroying the peace of mind of the people subjected to them. It’s high time that business schools stopped teaching old-style management ideas, stemming from Taylor’s “scientific management,” as anything other than a historical curiosity and a dreadful warning; much like you learn in history about the French Revolution and the guillotine. And it’s long past the time when any executive who fails to create a civilized working atmosphere, and high levels of creativity and engagement in his or her team, can be allowed to stay in a responsible position.

If shareholders want to maintain and create real wealth—as opposed to gambling on random stock movements, which is what many of them do—they should seriously consider forcing the necessary changes in the management of the companies whose shares they hold. After all, it’s their money that these macho jerks are wasting.



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Tuesday, April 03, 2020

Hamburger Management and the culture of fear

Dictators always suppress dissent. Corporate ones are no different.

Few things in this life are black-and-white, however much some managers try to make them so. Unquestioning loyalty easily becomes ethical blindness. When it does, it is no loyalty at all. Sometimes what the boss most needs is to hear the truth, before he or she says or does something that will bring harm. Besides, our freedom to question and to disagree is too important to be sacrificed in the trivial cause of helping to free our organizational masters from the discomforts and challenges of being questioned and held to account.

Is loyalty to the boss and the company always admirable? In today’s business climate, positive rebellion may already be essential if you’re not to lose out in global competition. Too much emphasis on loyalty can stifle creativity and dull people’s willingness to tell the truth about themselves and their work. Competitors ought to love overly loyal organizations, because no one there will be ready to rock the boat by pointing out how fast they’re becoming sluggish and obsolete.

Here’s the problem. Too much disloyalty is disruptive and destroys trust; yet unquestioning loyalty usually means that important issues may be suppressed until it’s too late. Getting the right balance between the loyalty necessary for corporate cohesiveness and the dissent that has to be encouraged to stimulate personal initiative isn’t as simple as it sounds. Tightly-knit teams are good for support, but very bad for encouraging initiative, creativity, and truth-telling. We need those people who are ready to look with different—even potentially disloyal—eyes and bring uncomfortable reality into the open. Without them, corporations and leaders get fat, dumb, and happy—until the dam breaks and disaster is all around them.

If the boss is already harassed and stressed, he or she is likely to be much more intolerant of opposition or questioning.

Dictators—political or organizational—are always surrounded by “yes-men” eager to prove their loyalty by saying whatever the person in power will find most acceptable. In such circumstances, the pressure to fit in and suppress unpleasant realities can be overwhelming. Haste and speed also put pressure on dissent of any kind. Instant acceptance is quick and easy. Coping with questions, objections, or alternatives takes time and effort. If the boss is already harassed and stressed, he or she is likely to be much more intolerant of opposition or questioning. And that’s without the added pressure of an organizational culture that is itself hostile to questioning of any kind.

Hamburger Management is obsessed with speed, simplicity, and managerial power. Hamburger Managers typically require unquestioning loyalty, and prize team players far more highly than individualists, whose curiosity and innovative thoughts may force those in charge to defend their decisions. Dissent of any kind is uncomfortable in such a culture. Skeptics who challenge whatever the boss has come to believe is expedient will soon find themselves moving elsewhere. Such irritating people deserve it, in the view of those in charge, because they waste time questioning things that the rest have already decided—or maybe don’t want to look at too closely.

When a culture prizes “loyalty” above all else, fear becomes the dominant emotion. Fear of doing or saying anything that might draw down punishment. Fear of “rocking the boat” or speaking out of turn. It’s too easy to brush objections aside on the spurious grounds that “there isn’t time” to consider anything else. Too easy to suppress individual freedom to think and speak in the cause of quick profits and the minimization of delays and costs. Organizations that have become badly infected with Hamburger Management produce exactly such a culture. No time to think, no time to deal with questions, no wish to consider alternatives, so closed-minded that dissent can no longer be tolerated.

Organizations full of “yes-men,” run by leaders obsessed with personal power and profit, are interested only in the most immediate results and so throw themselves headlong down today’s typically competitive, uncertain business path, beset with problems and difficulties, with their eyes tight shut. Mostly they deal with difficulties by either ignoring them or trying to blast through them by a deadly combination of brute force and willful ignorance. They’re tough guys, aren’t they? They stop for nothing . . . until something stops them—dead.

There is a way to reconcile loyalty with openness to uncomfortable truth. It’s based on requiring ethical choices, not unthinking or unquestioning loyalty.

Before all the unthinking assumptions built into Hamburger Management cause the organization to buckle, then break, under the combined weight of problems ignored and changes sidestepped, there may still be time to draw back and avert disaster. What it takes is slowing down enough to think. It also needs enough trust and tolerance for eccentricities that people become willing to draw problems to the boss’s attention in time to make a difference. Those “disloyal” whistle-blowers who reveal hidden corruption and deceit are important and valuable folk, often moved by a stronger sense of ethics and duty than the rest of us. they shouldn’t be suppressed or punished. They should be seen as the “canaries in the coal mine:” a vital early-warning system of a build-up of dangerous corporate gases.

There is a way to reconcile loyalty with openness to uncomfortable truth. It’s based on requiring ethical choices, not unthinking or unquestioning loyalty. When people work through the ethics of trust and support for boss and peers, it’s possible to see where the balance lies between being honest (even if that involves dissent) and being truly disloyal.

Loyalty has long been prized by leaders. To be disloyal to one’s superiors is typically seen as offensive and culpable. The more authoritarian and dogmatic the leaders, the more they tend to prize loyalty above other traits in their followers. Hamburger Management often produces a culture where loyalty is so obsessively demanded that it produces a culture of fear: a place where anything other than total, unquestioning obedience to those in charge is seen as intolerable. And that, I believe, is not the least of its many curses.



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Thursday, March 29, 2020

By their fruits ye shall know them

Bad decisions reveal bad leaders, whatever the excuses they make

How can you gauge the quality of leadership in an organization? There’s one, simple way: by looking at the decisions they make. When short-term decisions are the norm, greed is everywhere, and ethics are either ignored or seen as something to be “got around” for the sake of profit, you know that the leadership has become so riddled with Hamburger Management that it has reached rock bottom.
Two news stories in two days brought home to me just how far down the scale of basic leadership competence organizations can go. One was about a company that allowed secret military information about night-vision equipment to be provided to companies abroad, including some in China. I say “allowed.” That’s too weak a word. According to a spokesperson from the US Justice Department, some of the organization’s executives not only knew that they were breaking the law, they tried to work out the best ways of doing it, so as not to be caught. The United States attorney, John L. Brownlee, said in a statement. “The criminal actions of this corporation have threatened to turn on the lights on the modern battlefield for our enemies and expose American soldiers to great harm.”

Why did they do it? To save money by outsourcing, so inflating profits.

The other story was about Circuit City. It seems they are planning to lay off more than 3000 experienced, higher-paid people and replace them with new recruits at lower wages.

Why? To boost the bottom line.

This time, even some of the financial analysts expressed surprise. The New York Times quoted one as saying:
While we view these cost cuts as clearly good for near-term earnings, they are not necessarily the way to drive longer-term operational success. It stands to reason that firing 3,400 of arguably the most successful sales people in the company could prove terrible for morale.
Yet, despite this clear statement that management were making a decision that mortgages the future for short-term gain, the company’s shares rose by more than 2 percent. It seems that Wall Street still can’t manage to raise its eyes beyond the next quarter. Never mind that customers will now, presumably, be served by newer, less qualified and experienced staff when they want to buy an expensive flat-screen TV or some other expensive electronic gizmo. Who cares about providing quality service when there is money to be made?

. . . he found it incredible that a business would endanger the lives of American soldiers, just to increase their profits by a few percentage points.

Short-termism is the essence of Hamburger Management. Yet how staff behave, especially towards customers, is telling the rest of the world—very clearly and loudly—how good the executives are as leaders. When I see poor staff, I know the leadership is crap. And don’t give me all that rubbish about blaming the quality of the people available. If management employs the cheapest people that they can hire, there’re getting what they deserve and telling potential recruits that they would rather fire you than reward you properly. As a result, good staff soon won’t be seen dead working in their organization. Worst of all, management obviously don’t care. Only the cheapest is right for their customers. Never mind the quality, feel the profits. However they slice it, it’s clear who will be to blame for the long-term decline of the business. There can be no excuses.

What about the ethics of decisions like this? Is it right to break the law and send military secrets to possibly unfriendly countries to make a buck? Is it right to fire good employees, just because you may be able to hire less good ones more cheaply? I listened to a US government official saying that he found it incredible that a business would endanger the lives of American soldiers, just to increase their profits by a few percentage points. I want to ask him what world he was living in. There are executives out there who would sell their children into slavery to boost the value of their stock options.

Civilized societies don’t foster unbridled greed.

It’s high time we took a very long, careful, and objective look at the kind of business communities we in the West are allowing to develop. Do we want truly unfettered capitalism, where everything is fair and all that matters is how much profit the company reports each quarter—and how much cash the executives take away as a result? Do we want the pursuit of money and power to become the sole arbiter of what is acceptable? Do we want our business leaders to put personal greed before the public good?

If we don’t, it’s time that we found ways to rein back the less acceptable forms of corporate behavior. Civilized societies don’t foster unbridled greed. They don’t condone law-breaking in search of better-looking figures. Nor do civilized organizations. I have yet to hear that anyone involved in these dubious decisions has been disciplined, let alone fired.

“By their fruits ye shall know them,” it says in the New Testament. What do these decisions tell you about the businesses involved?



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Tuesday, March 27, 2020

Management today is becoming a fantasy game

He (or she) that expecteth too much often receiveth nothing at all.

When it comes to key decisions in the business world, expectations seem to outweigh reality on just about every occasion. The results include endless gyrations in financial markets, increasing levels of stress and anxiety, and the needless loss of excellent staff. It’s time to get our feet back on the ground.
Have you noticed how much the world we live in today is driven by expectation, especially the world of work? Expectation trumps reality on just about every occasion, from the stockmarket to the boardroom and the office cubicle.

Let’s suppose that Acme Corporation reports a profit of $200 million for the quarter. That’s a tidy amount of money. Last quarter, they made $195 million, so they are consistently in the black by a substantial margin. Yet their share price falls on the news, perhaps by a significant amount. Why?

Expectations. The gurus of the stockmarket expected a higher profit, so Acme Corporation’s performance is judged to be below standard. But while this seems logical at first, it takes no account of whether those expectations were reasonable—or even had any rational or objective basis at all.

Reality is immediately trumped by expectations—even if those expectations are based on nothing more than hot air.

A great many expectations in the financial markets and the media have neither factual basis or logical support. They are created from rumors, hopes, fears, and fantasy. In our imaginary example, Acme Corporation is returning a steady and substantial profit. But that reality is immediately trumped by expectations—even if those expectations are based on nothing more than hot air.

We can see the same process working at the individual level in many organizations. Sara Smith has a good performance record. She works hard, has good skills and a sharp mind, and maintains a clear focus on what needs to be done. Her boss has high hopes for her. Suddenly, things seem to go awry for Sara. She gets a performance rating of “adequate” and a long lecture from the boss on “letting the team down.” She’s urged to work harder. Hints are even dropped that her career prospects are on the line. Whatever happened?

Nothing. Sara has been doing what she has been praised for doing in the past. But her boss’s expectations have soared into the stratosphere. Without any reference to Sara, he has created a dream of constantly-accelerating results, all based on his imagined view of Sara as a whizz-kid. As her manager, he is already enjoying (in his head only, alas) the praise and rewards showered on him from the top brass. All it needs is for Sara to comply.

But Sara has a life outside of work. She is a good employee and well aware of the need to give a fair day’s work in return for her salary. But, when that is done, it’s time to go home and enjoy the rest of her world. She is not aware of her boss’s glorious dreams for her, and would not go along with them if she was. So she keeps right on doing what she has always done—only suddenly it’s no longer enough.

In this tragi-comedy of errors and misunderstandings, the boss feels fully justified in re-classifying Sara’s performance downwards, based on his expectations of what (in his mind alone) it ought to be. Not surprisingly, Sara is hurt and confused. She cannot see where she has failed. In her bewilderment, she starts to lose confidence in herself and the others around her. Her performance really does falter.

When the boss once again expresses disappointment and anger, Sara decides enough is enough. She looks for another job. When she leaves, her boss sees a team member who never really had the “right stuff.” Sara sees a boss, and an organization, that has no clear standards and arbitrary ideas about what is required.

It is the perfect lose:lose scenario, played out in hundreds of workplaces every day.

The reality is that they are both wrong. The organization has lost an excellent employee, and must now incur extra cost to replace her. The boss allowed unsupported expectations to become his reality, ignoring what was really going on. He has failed as a leader and cost the business a great deal of money as a result. Sara has lost a job that she enjoyed—and probably taken away a severely lowered sense of self-confidence that may indeed impact her subsequent career. It is the perfect lose:lose scenario, played out in hundreds of workplaces every day.

Reality is what counts. Expectations are insubstantial thoughts—mere dreams and hopes—often based on little or nothing at all. To allow expectations to guide actions is like driving along with your eyes shut, following an imaginary road map inside your head. Is it any wonder if disaster lurks at every corner?

In a world driven by the media, expectations create headlines whereas facts produce only dull text.

We have lost sight of the difference between legitimate hopes and goals and the reality that follows. There is nothing wrong in setting goals for yourself—or others—so long as everyone is able to probe and question how reasonable those goals are before accepting them. The notion that, merely by setting a “big, hairy, audacious goal,” you will galvanize peak performance is total fantasy. I can set myself the goal of earning $10 million next year, but such a goal has not the slightest contact with reality—nor can I justify it by enthusiastic wishing. So why do we do it? Mostly, expectations are more exciting than reality. And in a world driven by the media, expectations create headlines where facts produce only dull text.

Leaders and managers need to have the best possible grip on reality, however disappointing that reality may be. Nothing is to be gained by indulging in fantasies, even if they are well meant. Leave exaggerated expectations and imaginary scenarios to media hacks and political lobbyists. To succeed in life and work, every decision and choice has to be made on reality as it stands—never allowing your dreams for something very different to be confused with what is happening in the real world.



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Monday, March 26, 2020

What a difference a word makes!

Why “improving motivation” is rarely, if ever, the answer.

Current ideas about motivation are a prime example of management theory and jargon twisted into the service of Hamburger Management. “Improving motivation” has become a group of impersonal techniques, to be applied to people in the way that you might apply a technique to herding cattle. What if we changed the words? What if we dropped all the talk about motivation used the word “encouragement” instead?
Motivation is all the rage. It’s often seen as a universal requirement for everyone, whether they are expected to motivate themselves (as many self-help gurus proclaim), or to motivate those that they supervise (as legions of consultants and corporate trainers advocate). But what is motivation? Can it live up to the exaggerated claims now being made for its almost panacea effect?

At its simplest, motivation simply means “moving.” From there, it has come to mean moving towards some goal or end point. Self-motivation (as in: “Fred is able, but lacks self-motivation) is moving yourself in some definite direction. Elsewhere, it means little more than displaying energy and enthusiasm: a willingness to take positive action and utilize skills and abilities in the required direction. And in much official and business communication, the complex and abstract phrase “lacks motivation” is preferred—as more politically correct—to the simpler English “lazy” or “indolent.”

Motivation is also used in the sense of “making others motivated.” The verb “to motivate” is a staple in management jargon. Leaders are required to motivate their people—which means to cause them to do what the leader (and their organization) wants. How is this done? Typically, by application of the age-old process of “carrot and stick.” To get the donkey (or employee) to move where you want, you must either dangle a carrot in front of its nose (an incentive, bonus, or reward desirable enough to cause forward movement in that direction); or apply a stick to the other end of the poor beast’s anatomy (disciplinary action, punishment, withdrawal of privileges) to urge it forward in that way.

I am far from the first to wonder whether any leader can actually motivate another person in the way motivation is usually seen. Incentives (actually bribes) work for a time, but are subject to rapid inflation. Today’s incentive is tomorrow’s expectation. Punishments may produce movement, but they are hardly likely to produce enthusiasm. As has been found with the use of torture (or “strong interrogation methods,” if you prefer), people will say or do many things to stop the pain, but rarely mean any of them (or offer the truth, if something else will do just as well).

There is a fundamental problem with all the talk of motivation: it ignores or glosses over a search for the real causes of poor progress. Like so many other “techniques” that have become part of Hamburger Management, it’s a flashy, superficial, supposedly simple answer to an enormous range of largely unknown problems. What if we changed the word? What if leaders were expected not to motivate their people, but to encourage them?

Encouragement is a warm, natural, human activity; motivation is cool, detached, mechanistic.

Encouragement (literally, filling someone with courage) has little to do with either the stick or the carrot (save when it is used as a euphemism). To encourage someone, you must get to know them, find out their strengths, help them overcome their fears and the obstacles that hold them back, praise their achievements and support them through bad times. Encouragement is a warm, natural, human activity; motivation is cool, detached, mechanistic. Self-motivation could be replaced by self-encouragement: the process of helping yourself by building greater self-confidence and recognizing when your fears are the real obstacles to progress.

When someone fails to make progress, or appears indolent and disinterested, there has to be a reason. It could be something in that person’s character. It could be that he or she is in the wrong job, or having personal problems, or feeling unwell, or missing some essential skill or experience, or is fearful of making a mistake, or lacks the confidence even to try. The list could go on and on.

Sadly, the typical Hamburger Manager has neither the patience nor the inclination to discover the truth. So a panacea—a catch-all solution—is quickly applied: motivation. First the carrot, then the stick. Then, if that fails (because willingness to move was never the problem), the person is labeled “unmotivated” and swiftly removed in some convenient way. It’s as if you got into your car, found that it would not go faster than 20 miles per hour, and either filled the tank with the highest octane fuel that you could find or kicked the bodywork hard as a solution to the problem. When both failed, you would next abandon the vehicle on the side of the highway and go buy another.

Wise managers see improving motivation for what it is: a simplistic group of quick-and-easy “answers” to difficult problems. Instead of joining in the frenzy, they step aside and do what great leaders, great teachers, and great mentors have done since humankind began. They take time with each person and encourage them to clarify, then solve, whatever it is that is holding them back from what they can and should become. They don’t do anything to the other person. They don’t apply a technique. They neither run ahead of the other, waving a carrot, nor press on them from behind, wielding a big stick. They walk beside them, seeing what they see and helping them to understand it in ways that shift a negative and frightening prospect into something positive and inviting.

Wise managers see improving motivation for what it is: a simplistic group of quick-and-easy “answers” to difficult problems.

Don’t try to motivate people. Encourage them. Don’t worry whether or not you feel motivated, Recognize what needs to be done and do it, trusting that you will find the stimulus that you need from the courage and confidence that will build within you as a result. Life is always movement. Trust it.



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Tuesday, March 20, 2020

Myths of management

Is competition always so beneficial?

Business uses ideas from many sources, but the military and the sports arena are the origin of more business ideas (and downright myths) than anywhere else. Perhaps that’s because of the domination of business by men. The military was, until very recently, a male preserve; and sport has long been a staple of male conversation, since the days when it consisted of kicking an enemy’s head around a muddy field. Sport has influenced business as much as business has now come to dominate sport.

Competition is essential to sport, whether you play against your own past achievements or another team or individual. Take away the element of competition and football becomes group of hooligans in helmets knocking one another over. Golf becomes the stupidest way imaginable for putting a small, white ball into a series of holes in the grass—and why would you want to do that anyway? And tennis . . . why should one person hit a ball to one another over a piece of netting, only to have the other person hit the ball back again?

The assumption that putting people into competition against each other inevitably causes them to work harder or better is just that—an assumption.

Business is not a game—though many people treat it as such. It has a purpose, and supposedly that purpose is beneficial. Competition between products or corporations may be essential to prevent monopolistic exploitation in a free market (if only because we accept that organizations will not restrain themselves otherwise), but the assumption that putting people into competition against each other inevitably causes them to work harder or better is just that—an assumption.

Competition is said to bring out the best in people, but outside the sporting arena, most people find competition increases their anxiety and level of fear. Do people do their best work when they’re anxious, frightened and under stress? Do you? If you win, all is well, and you may forget the terror you felt. If you lose…well, who cares about losers? I’m not saying competition always has such negative effects, but it’s very far from being a universal spur to healthful actions.

There’s the problem. For every winner, there must be one or more losers. And before you say losing will spur them to greater efforts next time, think about it. Is that simply your experience? Or do many “losers” resolve never to repeat such humiliation again? Doesn’t it also cause alienation and wreck people’s self-esteem? And doesn’t it sometimes drive people to seek to win by any means available, including deceit and violence?

Before you say losing will spur them to greater efforts next time, think about it. Is that simply your experience?

Of course, competition in sport has another purpose: it’s what spectators come to watch. The best game, from the spectators’ point of view, is a close-run match where neither player or team seems capable of beating the other. But if winning is all that counts, as we’re often told in the business world, the best game from the player’s point of view will always be the one where he or she dominates to such an extent the opponent never has a chance. Win fast with little or no effort. But who would go to watch? And without spectators and TV audiences, there would be no money. That’s why the organizers try so hard to produce matches which hang in the balance, even, in the case of some “sports,” to the extent of choreographing events and sending players into the game with suitable scripts.

Business isn’t—yet—a spectator sport (though Donald Trump and his imitators seems to be trying to make it one), so ease of winning ought not to be a problem. If you want to be a winner, pick on others who have no chance against you. And that’s exactly what happens, only it’s usually done by competing against superficially able “opponents” whose ability has been hamstrung in some way—because you’re the boss; because you’ve made it clear you’ll destroy their careers if they make you look bad; or because you’ve rigged the game against them in advance.

There used to be a time when awards were about showing outstanding skill or ability, regardless of other people, not just winning and losing.

Making people compete against one another for rewards, attention and praise has become traditional, but it’s not the only way to set standards or share prizes. There used to be a time when awards were about showing outstanding skill or ability, regardless of other people, not just winning and losing. When showing your skill and sportsmanship counted for more than coming out on top. Thanks to the media’s obsession with turning everything into a no-holds-barred wrestling match, politicians have become die-hard competitors, judges preside over trials that closely resemble gladiatorial contests, and even literary awards are tricked out in the paraphernalia of competition, complete with squabbling judges and post-game slanging matches. And as for the Oscars . . .

Competition spurs some people to higher effort. It convinces many others it’s not worth trying and being humiliated. It causes some to seek to win by honorable means, and others to cheat. So who rises to the top? The able and honorable competitor, or the cheater? Can you tell—until it’s too late? Does the rash of top executive prosecutions tell you anything about the results of a “winner takes all” outlook?

Myths are not lies. They contain an element of truth, somewhere. They only become dangerous when they’re treated as self-evident. Competition in business is far from being the best way to encourage individual or team excellence, let alone the only one.



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Tuesday, March 13, 2020

If feeling safe is good, does feeling good require feeling safe too?

How circular thinking corrupts management action

Much of management thinking is marred by sweeping generalizations, egregious platitudes, and faulty or non-existent logic. Few aspects are worse than the circular definition, where the converse of some supposedly true statement is also assumed to be true. Until we rid ourselves of such silliness, we will continue to chase mirages and put our trust in falsehoods.
Management thinking of the conventional kind is full of circular definitions. They work like this, beginning with a statement that is mostly true, then reversing it and assuming that is also true. For example, getting results quickly is good (a vague, but mostly true generalization), which is then reversed to create the (mostly false) generalization that quick results are a measure of how good something is (getting results quickly is good, therefore good means getting results quickly).

Aside from being non-existent logic, such circular definitions do real harm. Take this pair: successful people are good to have around, therefore to be good to have around you must be successful. Since many of the causes of success (circumstances, luck) are outside people’s control, defining “good” as “successful” actually means basing your definition more on luck than expertise or judgment. Besides, some successful people are not at all good to have around, since their success breeds outsize egos and a prima donna attitude to everyone else.

What about this one: profit is what business is all about, therefore all business is about profit. The first part of the statement is questionable (it ignores the social and technical aspects of business), yet is probably broadly true. Yet the second part is neither true nor follows from the first. Much of business has little to do directly with making a profit, being concerned instead with product development, long-term growth, and the discovery and exploitation of new markets (which may not generate any profit for years).

My final example is this: what you can measure you can control, therefore you cannot control what you cannot measure. This has the distinction of being false in both parts. There are many things we can measure, but not control, such as rainfall, the growth rate of our children, and the buying habits of our customers. And as for not being able to control what we cannot measure, that may be true of leaders unable to control their tempers, their egos, and their greed, but it doesn’t apply to the rest of us.

Beware of circular definitions based on nothing more than platitudes and apparent symmetry. Hard-working people sometimes find success, but it doesn’t follow that success is always due to hard work. Sometimes, it is; quite often it isn’t. Even those who believe money brings happiness don’t usually claim that happiness brings money. So why should they assume that working long hours brings success?

I’ll leave you with this thought: if continually cutting costs boosts the bottom line, does improving the bottom line depend mostly on cutting costs? Many of today’s organizations act as if it does—which is probably why they are on a descending spiral of cutbacks and lay-offs, not an ascending one of greater creativity, expanding markets, and exciting new products. Compare Ford with Toyota and you’ll see at once what I mean.



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Thursday, March 08, 2020

When the going gets tough, the tough guys often go too damn fast

Refusing an instant response is often the best way to come out on top.

Today’s macho management conventions often lead people into making mistaken responses to problems and setbacks: responses that may make things far worse. Appearing to yield, or refusing to be tempted into ill-conceived responses, is often the best way to save your strength and choose a more favorable time and place to deal with the issue. Short-term gains are very often the quickest route to long-term losses.

Sometimes, giving in is the best way to cope with life’s pressures and demands. That’s not a fashionable idea. Most gurus and trainers prefer to continue to push the idea that positive action is needed—usually, by pure coincidence, the one that fits what they are trying to sell you. Nevertheless, what I said is, I believe, quite correct.

Any student of martial arts has to learn right away that stiffening up and pushing back against an attacker is the least effective way to deal with an assault. If you first yield, the attacker has nothing to strike or push against. Expecting to come up against solid resistance, he or she is thrown off-balance, leaving them open to a quick counter attack. This holds true in less physical situations as well. I read recently of a case where a bullying boss ranted and raved at an apparently docile employee, completely ignoring the fact that many of today’s computers come equipped with tiny video cameras. Emboldened by encountering no obvious resistance, he displayed ever greater aggression. Only later, when he was fired, did he realize the nature of the counter-attack.

It even works when you have to deal with an “attack” by your own emotions. How often have you said or done something in the heat of the moment that you regretted later? If, under that internal, emotional assault, you had done nothing—had simply allowed the hurt and anger to exhaust itself with no resistance or action—you would have kept the opportunity to think about the situation calmly and judge the correct response. The next time a boss or a colleague gets under your skin, try doing and saying nothing immediately. Note the emotion inside you and let it pass. I’ll guarantee that there will be many occasions you’ll be glad you did.

The temptation is always to stiffen up, resist the assault, and launch an immediate counter action.

Events, too, have a nasty way of launching unexpected attacks against your plans, or the steady progress of your work. The temptation is always to stiffen up, resist the assault, and launch an immediate counter action. A normally reliable customer unexpectedly gives the order to a competitor: you grab the phone, move heaven and earth to reach the customer, and start trying to bargain to win the order back. In the meantime, you haven’t stopped to consider why the order was lost—or even whether it is still worth having, if you must bargain away much of the profit to keep it. Huge corporations respond to small percentage losses of market share in the way that a neighborhood bully responds to an imagined insult. Blinded by rage at the loss, they try to buy back the lost share with costly promotions and special offers. A while ago, the US auto manufacturers indulged in an orgy of special deals to prop up their respective market shares. Today, facing huge financial losses, they are closing plants, laying off workers, and trimming model lines. Their cash was spent buying market share, not investing in ways to deal with competition from overseas. Now it is almost gone.

Yielding under pressure at the start buys you time, avoids exhausting your strength, allows you to formulate a better response, and often puts your opponent off-balance. It saves you from expensive or embarrassing mistakes made because of short-term emotions. And it allows you to consider whether you want to fight back, at least on the grounds that the other guy has chosen.

Of course, taking action this way requires a longer-term perspective and a willingness to accept initial setbacks if the final outcome is likely to be in your favor. An obsession with “Hamburger Management” makes this difficult. If every minor skirmish is treated as a climactic battle; if every small setback is punished as if the war is now lost; if every inconsequential, short-term win is hailed as a grand triumph; then there is little option left but to fight to the death on every occasion, even if that bleeds away your resources in conflicts that cannot be won—and were never worth winning.

Short-term, macho managers typically win every fight but the one that really matters—the final one.

Those who take time to consider their options carefully and save their resources may be defeated many times, yet still win in the end. Most business “wars” are wars of attrition. There are few opportunities to deliver a single, winning assault. Competition usually goes on for years, even decades, with none of the competitors maintaining a decisive advantage for long. Against this reality, the cult of throwing everything into every short-term engagement makes no sense. It’s time executives realized that the survival of any individual corporation is totally unimportant to Wall Street, where the takeover of a mortally wounded or exhausted business is merely another opportunity for profit.



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Wednesday, March 07, 2020

Fishing for SCATE

A mythical creature still holds an irresistible lure for managers

A skate is a kind of bottom-dwelling, carnivorous fish, specifically belonging to the family Rajidae. A SCATE is something many managers seek—and periodically believe they have found: a Simple Complete Answer To Everything. Sadly, it is an illusion that creates havoc and leaves them struggling to recover from the effects of chasing after it.
T here’s something irresistible about a Big Idea: one that promises to provide endlessly useful and yet simple answers to the most complex problems that people face. Most religions are based on one, and it provides the central core of faith that they demand. Politicians are suckers for Big Ideas, because they can be waved like banners to attract votes and are set down in simple, emotionally-powerful sound bites, instead of the complex trains of reasoning that politicians fear. Business leaders too love Big Ideas—not the sloganeering kind, but those of the type that I call a SCATE: a Simple Complete Answer To Everything.

A SCATE promises to provide all the answers in a deceptively simple way. In the 1980s, “business synergy” and “economies of scale” were the favored SCATEs. They fueled an orgy of mergers and take-overs, often creating companies that had to be expensively dismantled within only a few years, so badly-matched were the elements that had been used to construct them. In the 1990s, the Internet provided a SCATE of heroic proportions. Not only was it believed, with little or no evidence beyond wishful thinking, that the Internet was about the change the business world and global economics completely and for ever; any organization with “dot com” at the end was guaranteed to make money, however incomprehensible its business strategy.

The Questing BeastAfter the crash that followed, you might have expected greater caution, but the SCATE is a resourceful creature. Like the Questing Beast of Arthurian legend, it is made up of very odd parts (the Questing Beast had the head and neck of a serpent, the body of a leopard, the haunches of a lion, and the feet of a hart (deer). In T.H. White’s modern re-telling of the story of King Arthur (The Once and Future King), the Questing Beast lived only to be chased. When King Pellinore was persuaded to stop chasing after it, it pined and almost died.

In recent times, there have been several new versions of the SCATE, each one holding certain managers in thrall like love-sick teenagers: “business re-engineering” was one, then “downsizing,” and now “outsourcing”. Like the SCATEs of the past, they are flaunted as the obvious answer to just about every problem of business success, especially by consultants (who breed them specially, it seems, since they provide the easiest path to new consulting assignments).

Reality is complex, messy and uncertain. It takes time to understand, if it ever can be fully grasped, and still more time to deal with. There are no easy answers, though rationality goes a long way towards providing at least some useful options. Dealing with it is unspectacular and often tedious. Explaining what may work is also demanding and usually complex, requiring careful thought and listening to follow the logic.

Contrast this with the SCATE: simple to describe, often highly colored, offering endless promises with little or no effort required. Its adherents swiftly become disciples and treat any who are not true believers in their particular brand of revealed truth as enemies and heretics, to be drowned out with cheers or removed by force. Where reality must be described in lengthy and complex ways, the true SCATE is completely displayed through crude, often emotional appeals to “get on board” and “join the party” before the opportunity is lost.

Skates, the fish, devour what they can catch. SCATEs do the same, gobbling up managers and organizations as their food, swelling on the rich diet—until they explode, to cover everyone around in the mess left by their sudden extinction.

Don’t fall for them. Take your time and stick with reality. Remember, they exist only to be chased by those whose belief in their personal heroic status exceeds the capacity of their intellect. Better to be laughed at as an unbeliever than become a sudden ex-hero, lost, bemused . . . and covered with SCATE-sh*t.



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Friday, February 23, 2020

Stepping through the looking glass

It’s long past time to try something new in management

Management today is mostly based on standard responses to problems. But like Alice, stepping through the looking glass into a wonderland on the other side, it’s always open to us to consider what might happen if we didn’t follow the set path, but broke out into fresh ideas and opportunities.

Suppose that we implemented the opposite of today’s standard management responses? What kind of business world might lie on the other side of the looking glass? Would it be a wonderland of untapped potential, or a wasteland of risk and problems? Let’s take a look.

Gone would be the cramping over-emphasis on instant results and avoidance of risk. No one was ever inspired to great ideas or endeavors by thinking only about immediate or short-term practicality. Only idealism ever inspires. That’s why corporations that favor idealism over pragmatism produce more innovative, more inspiring, and more motivating ideas. Pragmatism is fine for second-rate businesses handling commodity products, but that route will never win long-term market leadership. Visionary companies, and leaders with a fierce resolve to implement those visions, consistently win over the long haul.

If we want people to look to the long-term for their returns, we have to offer the kind of security and support that warrant their trust.

On the other side of the looking glass, organizations would retain key employees with long-term rewards, such as development, security, and opportunities for personal growth; not just short-term ones like bonuses and stock options. Where employees have learned to distrust the long-term security of their employment, they will always demand large rewards now as insurance against future lay-offs. If we want people to look to the long-term for their returns, we have to offer the kind of security and support that warrant their trust. The corollary of this must be that consistent, long-term performance would be seen as more valuable than quick wins (and long-term losses).

The more the demand grows for quick, measurable results, the more our aims become distorted to give only these—even if it hurts the organization’s interests in the longer term. Creativity and long-term potential is worth so much more than merely current performance. Instead of paying reluctantly to try to deal with any present performance shortfalls, which are only the symptoms of some underlying malaise, through-the-looking-glass organizations would go straight to the fundamental drivers of excellence: being trusted to do your job, set in the right role, given the right support, and allowed the freedom to contribute freely whatever gifts you can bring to your work. A group of free people, having fun and acting together out of choice and shared beliefs, will always outperform pressed labor and those whose loyalty and interest goes no further than the salary check.

Most management is still based on the underlying assumption of a “master” stipulating what the “servants” must do and judging them according to their performance against his or her imperious standards.

This is not the way to promote creativity, learning, or fun in the workplace—let alone real productivity. Leadership of this kind is always ‘us’ versus ‘them’: the expert leader instructing the ignorant subordinate and demanding compliance. Yet compliance never produces better than mediocre performance. None of us can do anything well if our hearts are not in it. Real achievement only comes about when people engage in an act of free will—an act with joy and passion—by choosing to thown themselves wholeheartedly into their work and seeking to understand what will improve their output, knowledge, or skill the most. Our public schools should have shown us all that when alienated pupils withdraw their consent to work and learn, no amount of discipline or teaching produces any result at all.

Our organizations and its leaders, like our society, have a long history of trying to deal with problems by coercion of one kind or another—legislating against them, or trying to drive them out of existence, instead of exploring to understand what produced the problems in the first place and continues to sustain them. At best, this drives problems underground; at worst, it gives them something to push against to build up their muscles. We need at long last to understand the total futility of this kind of behavior.

I shall be away until early March, so posting will be more intermittent than usual, as my access to the Internet will be sporadic at best. Please be patient and things will return to normal in about 10 days or so.



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Wednesday, February 21, 2020

You Are Not John Wayne

He may have been a great action hero, but Hollywood is still not like the real world.

Today’s media-driven, action-obsessed organizations are losing sight of the reality that sheer effort often goes unrewarded, unless it’s directed by some careful, complex, and time-consuming thought. Busyness and thoughtfulness are poor companions. Until organizations stop assuming greater effort is the simple answer to every problem, people will continue to work harder and harder for the same meager results—or none at all.

We live in a culture where action is highly prized and thought is seen as either pointless or suspicious. I’m not sure why this should be so. Of course, powerful rulers have always been suspicious of those whose motives and actions they can neither quite understand nor easily control. The bluff man of action was relatively easy to deal with. The quiet schemer was always the greatest threat. That’s why it paid to keep the cleverest people where you could see them, and deny education, and the leisure to think, to as many people as possible.

Maybe we also have Hollywood and our media-based beliefs to blame. It’s easy to display action on screen. It’s exciting, full of grand visual effect and opportunities for loud music and terrific over-acting. Displaying thought is tricky. Nothing much appears to happen, and complex thoughts can be hard for an audience to follow. It’s not impossible—William Shakespeare did it pretty well—but few screenwriters manage to reach his standard. Besides, pitting the brave, honest action hero against the skulking, devious, too-clever-by-half villain is such an easy driver of plots that few can resist it.

Whatever the causes, we are left with a culture where action—preferably lots of it and the more assertive the better—is assumed to be the answer to every problem.

Whenever people feel uncertain or doubtful, greater effort—more action—is called for at once. Do next quarter’s, or next year’s business prospects look shaky? Work harder, cut costs, increase everyone’s efforts. Is a project sliding off track? Stay at your desk until 10:00 p.m. every day, then take work home.

Never mind stopping to discover the real reason for the problem. These future sales projections may look bad because the product is falling out of fashion, or an unexpected competitor has brought out a superior alternative. The project that’s causing you to work 16-hour days may be doomed because it was badly conceived from the start. In neither case will extra effort alone make any difference to the outcome. It’s as if people feel that, in a just universe, all that determination and hard work deserves to be successful. The honest, perspiring hero, (or gallant, open-hearted heroine) should prevail, even if she or he hasn’t a clue about the problem or its causes.

That might be the case in a just universe. I wouldn’t know, because neither I nor anyone else has ever inhabited one. In the real world, effort very often goes unrewarded—especially if it, too, is misdirected, poorly conceived, or based on a total misunderstanding of the real nature of the problem.

No one ever produced a smart idea, an imaginative concept, a competitive edge, or a compelling vision without thought —typically a great deal of it.

No one ever produced a smart idea, an imaginative concept, a competitive edge, or a compelling vision without thought —typically a great deal of it. Hollywood may prefer simple plots that can be easily written and acted, but the universe rarely agrees with the neatness needed to make a one-hour TV show, with 20 minutes of commercial breaks. I recently heard on the radio that military personnel are copying what they see on TV as battle tactics. Rush in, shoot a few villains, and those who survive will immediately tell all they know. Works on TV. Sadly, in the real world, the survivors do inconvenient things such as lying, making up any old story to save their lives, or refusing to talk even under prolonged interrogation.

A corporate culture where thoughtfulness is seen as a waste of time, and intelligent reflection a probable basis for disloyalty and plotting, is going to discourage any spark of creativity or exploration that remains.

Constant busyness is practically guaranteed to drive any thoughts away, and leave no spaces where they might return. A determined focus on short-term actions destroys all chance of creating long-term advantage. And a corporate culture where thoughtfulness is seen as a waste of time, and intelligent reflection a probable basis for disloyalty and plotting, is going to discourage any spark of creativity or exploration that remains.

Relying on effort nearly always means doing what you are doing already—only harder. It’s very often taking a doomed idea and continuing to feed it with effort and resources, long after it should have been abandoned in favor of something better. It’s running about in a frenzy of action, when slowing down and giving yourself time to think up an alternative approach is the only likely path to success.

Stop shooting from the hip. John Wayne may have got the bad guy with every draw of his six-shooter, but he had considerable help from special effects, the director, and the script. In a 19th century gunfight in Phoenix, Arizona, two people stood on opposite sides of the street and blasted away at one another until both ran out of bullets. Neither suffered a scratch.

The only things that frantic busyness is guaranteed to produce are exhaustion, stress, and numbed resignation—exactly what many feel in today’s workplaces. Slow down and think instead. Then there’s at least a chance you’ll discover a way to succeed—and probably with about a quarter of the effort.



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Monday, February 19, 2020

Lies, Damned Lies, and Executive Platitudes

Why pretending to value people and acting otherwise is a corporate crime.

That handy platitude about our people being our greatest asset is trotted out in everything from press releases to annual reports to executive speeches. But does it mean anything? Is there ever any real intention to act on it? And if there is not, as so often appears, what are the implications for the businesses and organizations involved?
Recently, one of the regular readers of this blog, Dan, mentioned in a comment that the business platitude about our people being our greatest asset didn’t often appear to translate into action. Corporations, and the executives who run them, may claim that “our people are our greatest asset,” but their actions certainly suggest some very different assumptions. Staff are habitually accounted for as a cost, to be limited and minimized wherever possible, along with all other costs. Aside from the obvious ethical implications of such casual dishonesty, what are the true implications for an organization that fails to treat people as an asset at all?

A good place to start is to explore what actions might we expect to see, if this phrase about people being assets (let alone the organization’s greatest asset) was acted on in good faith. Any business’s assets are carefully protected and nurtured&mdashit;’s greatest asset most of all. And that asset would obviously be the central focus of most business strategy. Not only would it be used as carefully and effectively as possible to build and develop the business, it also surely be enhanced and added to whenever circumstances allowed. If someone says that their home, or their 401(K) pension plan, is their greatest asset, you would expect to see them invest time, money, and effort in adding to its value whenever they could.

On this basis, the action that prove something is believed to be a critical asset include:Does that sound like the way most businesses treat their people? Not to me. What I see is almost an opposite range of actions:Does it matter if it appears that in this case, as in so many others, organizations and executives say one thing and do another? I believe that it does.

This type of casual reliance on platitudes that no one intends to take seriously represents a serious ethical lapse: an automatic and institutionalized level of dishonesty.

Politicians regularly try to deceive the electorate with “spin” and lies, and more and more business leaders seem to be using similar tactics. In both cases, the result is widespread distrust, anger, and resentment. Taken too far, such actions undermine the basic respect for authority on which all countries and organizations depend for stability.

If business leaders fasten on the use of meaningless platitudes and “spin” as a way to sugar-coat their true intentions, they will wreck such trust as they still enjoy and create instead an atmosphere of continual suspicion. People are not compelled to work for a particular employer. They can refuse to join, leave, or (worst of all) stay to collect a paycheck, but give as little of themselves as possible in return. Destroying trust is both foolish and economically wasteful.

What would an organization look like if its people really were treated as its greatest asset?

Maybe it would be something like this:
Imagine the impact a mindset like that could have on a business. I wrote earlier that I thought it really mattered if organizations talked about valuing people, but acted in the opposite way. This is why: they are ignoring or wrecking what could be a genuine asset of huge value to the business, if only they treated it as such.

To my mind, that is close to being a corporate “crime.” It is certainly a gross dereliction of the duty of any executive to the owners or shareholders. Suppose some executive neglected maintenance and allowed expensive machinery to be ruined. Wouldn’t you expect them to be disciplined, or even fired? So what should happen if a boss treats people in ways that ruin their effectiveness through increased stress, lowered morale, limited creativity, or increased turnover?

Actions, it is said, speak louder than words. In the Christian Bible, it is written that you can know people’s true nature by their “fruits,” meaning the visible results of what they do. If many of today’s organizations were trees, their fruits would range from bitterly unpalatable to downright poisonous. It that any way for a civilized society to organize how it deals with work?



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Friday, February 16, 2020

Workplace Karma

Do unto others, and they will make sure they do unto you



A thought floated across my mind recently, when I was reading something about the ideas of “karmic law.” I’m not an expert in Buddhist or Eastern thought, but what I understand of the idea of karma is that it’s a refined version of cause and effect: what you do affects what happens to you, or “what you give out is what you get back.”

It seems to me that you don’t need to have any kind of belief in either the supernatural or Eastern religion to see that “what you give out is what you get back” represents simple realism.

Suppose that you’re a typical “Hamburger Manager.” You’re tough, assertive, macho, obsessed with short-term results, and tireless in your pursuit of your own ambition. What you “put out” in terms of behaviors will likely include: What will likely come back to you as a result?What the universe will give you back from giving out Hamburger Management is all the worst, most stressful, and least fulfilling aspects of the business environment. And if that tempts you to respond with even more rigorous Hamburger Management thinking, you’ll get still more of the same. If you pay peanuts, you get monkeys. If you lead like an idiot, you’ll be surrounded by idiocy. If you act like a bullying, aggressive bastard, you’ll be amazed at how many other nasty, callous bastards you will encounter every day; and how keen they will be to screw you over on every possible occasion.

The other reality of this faux-karmic law is that it multiplies. There’s one of you (one manager, one organization), but thousands upon thousands of other people to return what you send out. Act aggressively and thoughtlessly and all these thousands will return the same behavior, often with interest. So, if you act like a jerk, what you’ll get back is the same behavior, multiplied by the number of people who suffer from what you do.

There it is: behave like the stereotypical, bullying manager and that’s exactly what you’ll encounter in return. Do it consistently, and your return will be multiplied by several orders of magnitude. Give out honesty, trust, creativity, and sensitivity to others and that’s what the universe will most likely play back to you, also enhanced and extended.

It’s your choice. If your daily experience at work is that the world is full of people throwing sh*t around, the chances are extremely high that you are a major contributor to the process that put all that brown stuff there for them to throw back at you. Maybe, if you stop dishing it out, you’ll begin to find that less comes back. If everyone did that, very soon there would be none to throw around any more. Think about it.



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Thursday, February 15, 2020

Do you recognize today’s biggest business killer?

Audit mentality puts efficiency first, but innovation is what sells


Today’s standard responses business issues are limited and uninspiring, even as we stand in serious need of a steady flow of creative ideas and fresh innovations just to keep our high-tech, high-earning, and high-expenditure lifestyles in place—let alone to add still greater prosperity for more people. Cost cutting, increasing working hours, and driving employees harder and harder are all based on doing what you do today more cheaply and efficiently. But what if doing what you’re doing now, only better, isn’t enough? What is you need to offer the world something altogether new? No one ever stimulated creativity by staying longer at the office, cutting benefits, or driving people to the edge of exhaustion and beyond. If the audit mentality takes over, the future will be bleak.

Many of today’s businesses are too focused on the present and the past. Their futures are extremely short-term, usually bounded by the next reporting cycle and Wall Street’s immediate expectations. They talk about change and innovation, yet act almost entirely on making current activities less costly. It’s a kind of corporate schizophrenia: one personality jabbers away about taking on global competition through innovation and new technology; the other—the one actually in charge—assumes that the only way to succeed is by doing what is being done already, only more cheaply.

Today I read that DaimlerChrysler will cut 13,000 jobs in an attempt to return to profitability. Their sales have fallen drastically and they are running out of money. Why has this happened? Because, like the rest of Detroit’s automakers, they bet the farm on huge, gas-guzzling SUVs. Now, like their competitors in that market, the only way out seems to be to cut back hard and hope for the best.

But, wait a moment. Their product line isn’t selling and they are losing market share. How will drastic cutbacks address those issues? It may buy them time before Chapter 11 bankruptcy is the only alternative, but surely what they need most is a new, more attractive, more innovative product line?

If Americans are buying from foreign car manufacturers like never before, especially brands like Toyota, becoming more efficient as manufacturers will only help after you have a product line that more people want to buy.

That’s the wrong way around, it seems to me. Toyota aren’t successful just because they’re more efficient. First and foremost, they have products that people want to buy.

That’s the wrong way around, it seems to me. Toyota aren’t successful just because they’re more efficient. First and foremost, they have products that people want to buy. Then—and only then—they work to produce those products as effectively as they can. Can you buy an MP3 player more cheaply than the cost of an iPod? Sure. So why do Apple sell so many iPods?

The audit mentality in many companies is hopelessly inward looking. It sees only costs, efficiencies, and margins. Of course, the consumer has no interest in any of these. Unless you operate in a commodity market where every version of a product is identical, save in price, people don’t buy the cheapest product, whatever economists claim. They certainly don’t buy the one that yields the highest return to its producer. They buy what they like most, what will win them the admiration of their friends, what provides the most features that they want (not the ones the technical geeks get most excited about), and what will make them feel good about their purchase.

People want what they want—and then they want to get it at a good price. Low cost comes after desire, not before. It’s not what drives sales.

Efficiency is nowhere on this list. Nor is price. Of course, some people like to boast about getting a bargain, but few, if any, will buy what they don’t want, just because the price is good. They want what they want—and then they want to get it at a good price. Low cost comes after desire, not before. It’s not what drives sales. The corporation that can produce desirable, exciting products first—then do so in a way that prices them competitively and yields a good margin second—is the one that is going to dominate the market.

In any business, you need first of all to have a product or service that people want to buy. Then, and only then, you need to be able to provide it in a way that renders you a good profit. Today’s conventional approaches to management have it the wrong way around. That’s why we see once proud corporations reduced to survival mode: they concentrated on being the “lowest cost producer” and ignored what they were producing.

Creativity needs time, relaxation, the willingness to take risks, and the long-term vision to see something from concept to reality. When corporations truly take risks in the cause of producing ever more innovative and exciting products, no one begrudges them the profits needed to support that endeavor. We all benefit. When those same corporations try to drive up profits by scrimping and cutting back, stifling innovation and damping down every avoidable risk, with the intention primarily of rewarding financial institutions and top executives, almost any profit they make appears self-serving and excessive.

Business is risky. Investment in the future is never certain. The pay-off may take many years. But capitalism, as a system, exists precisely to provide the money businesses need to take those risks, hopefully to increase everyone’s prosperity and the range of goods and services available in the market. It is not there to wring the last few dollars from dying products to enrich a few, while allowing those with more imagination, a longer-term focus, and less obsessive interest in short-term share-price movements to take over the market.

Get together an offering that excites people. Then, when it’s out there and selling, focus just enough on keeping down the costs to maintain a solid margin.

Slow down. Take the time needed to be creative. Drive innovation, not still more stress. Get together an offering that excites people. Then, when it’s out there and selling, focus just enough on keeping down the costs to maintain a solid margin. But, whatever you do, never allow concern with efficiency to limit creative thinking about the next new thing.

The past is gone; whatever money you made then cannot be changed. The present is fleeting; it’s usually too late to change what you’re already doing, good or bad. The future is wide open; only there can change alter how things will happen. The audit mentality is a business killer. Have nothing to do with it, or it will slowly choke the life out of whatever future is open to you.


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Wednesday, February 14, 2020

Accepting the unacceptable : a thought for Valentine's Day

Here’s a simple yet profound thought from Jessica at indexed about gifts for Valentine's Day. [link]

Here’s my “workplace” version:


Why do we accept this as normal?

I cannot see that any working culture marked primarily by constant haste and distraction, continual pressure, and frustration on a massive scale could possibly be described as either “efficient” or “inevitable.”

Yes, the business environment is competitive. It always has been. Is it any more competitive than it used to be? I doubt it.

Yes, the business environment is competitive. It always has been. Is it any more competitive than it used to be? I doubt it. The competition is simply different, that’s all. But even if the level of competition has increased, that’s no reason to accept a wretched kind of workday and career experience as normal.

Human beings choose and sustain their working environment the way it is. It isn’t a natural product, like the weather, over which mankind has no control. We chose capitalism over communism and a centrally-planned economy; that wasn’t an “act of God,” it was an act of mankind. We choose to operate within a global economy, because enough people believe that it works for them—at least in the sense of increasing their prosperity and that of their organizations. Boards of directors don’t have a totally free choice over how they structure and run their businesses. They have to comply with the law and various regulations and expectations. Yet, even with all that taken into account, they still have a great deal of freedom in what they choose to do. That’s even more true of private companies, family-owned businesses, and sole proprietors.

Why do so many stick to a business model that creates so much stress and misery? Is it a failure of imagination, a lack of nerve, or a simple ignorance that any alternatives are possible. People like Ricardo Semler have shown that there are other ways—probably many, many of them.

Shouldn’t we be trying a few?



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