Whole Foods, but not the whole truth?

Why truth matters more in business life than many currently believe.

Truthfulness is often an early casualty in the path of macho management. Such “soft” virtues as honesty and truthfulness are treated with disdain by hamburger managers, obsessed as they are with getting results and winning by any and all available means. This is a bad mistake, and one that is nearly always punished in due course.

Here’s an interesting piece from yesterday’s Huffington Post on the topic of trust. The starting point is the case of the CEO of Whole Foods and his anonymous blogging that hyped his own business (and even praised his hair style) and knocked the competition.

A few short extracts will give you the flavor:

What signal does Mackey’s behavior send to Whole Foods executives and employees? That deception is practiced by their CEO and therefore an acceptable practice? What signal does this send to Whole Foods suppliers? That representations may not be what they seem?

Stephen M.R. Covey’s important recent book The Speed of Trust: The One Thing that Changes Everything, reminds us of the business case for being trustworthy and being seen as trustworthy. Character is first among equals in leadership requirements. Reputation takes years to build and seconds to destroy.

And Thomas Friedman’s excellent op-ed piece (“The Whole World Is Watching”) underscores a new fact of life these days: your behavior, words and deeds are part of a permanent record, enabled by the internet.

Hopefully, we are coming to an end of the tolerance given to unethical and unpleasant behavior by leaders, just as long as it “produces results.”

Of course businesses need results: their survival depends on them. But how those results are obtained isn’t irrelevant. Business is part of life and our society. It isn’t some separate sphere with its own rules and standards, independent of the demands of a free and civilized way of living.

People have always held their leaders accountable for their behavior—eventually. It may take a while. There’s often a period when leaders are given the benefit of the doubt; or when the novelty of an approach, or the presence of a fresh face, can obscure what is going on. Yet in the end, even the most ruthless and devious leader will make some error. At that point, all the envy and dislike that has been building up tends to come out and cause a violent delight in hastening their downfall.

Truth is too precious to ignore

Truth is the basis for all civilized societies. Without knowing, truthfully, what is happening, democracy is neither effective nor, ultimately, possible.
No one can be truly free if they are being kept in ignorance at the same time.

Truth is also essential to trust. Despite the faux-sophisticated sneers of macho managers and financial whiz-kids, all business depends utterly on trust. You have to believe that, in the vast majority of instances, people will honor contracts, deliver what they promised, and pay what has been agreed. Where there is no trust, every small thing has to be checked constantly; no one can be allowed to work without constant supervision; no message can be transmitted with being checked and re-checked every step of the way.

No truth = no trust = massive waste of resources

Can you imagine what all this would cost? How much every transaction would be slowed down by all the checking and auditing involved? How much time, energy, and money would go to waste on the conflicts, lawsuits, and bickering that would result? There is enough erosion of trust as it is to suggest just a tiny fraction of what would happen if trust broke down more significantly.

There used to be a time when society forced business leaders to practice greater honesty and trustworthiness. Sayings like “my word is my bond” summed up the prevailing notion that dishonesty and lying were not to be tolerated among those who controlled the business world.

Of course there were rogues too. There always have been. But they weren’t praised and excused in the way that they are today. Making money was more often seen as a slightly distasteful business: an activity that had to be conducted with one hand held over the nose. To be rich through business might well not win you respect in polite society. The only way to avoid the stigma of “trade” was to be known for your absolute probity—even if it cost you some of the potential profits.

This seems quaint today, when being rich can appear to absolve you from every character flaw and sin. In reality, that isn’t true. Lying, cheating, and betraying others to enrich yourself are still, I believe, intensely distasteful to most people. The public may be dazzled for a while by fame and glamor, but it always wears off.

For long-term success, the truth isn’t just something, it’s everything

From time to time, people ask me how they can choose the right path in life; how they can avoid stress and burnout; how they can be happy.

If I knew all those answers, I would be some kind of superman and I’m not. All I know are a few of the most important questions. And I know that telling and facing the truth is such an essential part of any answer to life’s problems that it’s hard to overestimate its importance.

If you don’t tell the truth, especially to yourself, you are living a lie and are so far off any sensible course that disaster seems inevitable. How can you find any answers to the problems of your life if you won’t be truthful about them, even to yourself? How can you get people to help you if you lie to them?

If you won’t face the truth, you’re a fool. You may be able to convince yourself of your deceptions and evasions. You may be able to convince other people too, at least for a time. But you can never, never, deceive reality. Try all you want, reality will proceed on the basis of a strict adherence to the facts. It will treat your fantasies with contempt and you with impersonal accuracy. All you will have done is compound any problems by closing your eyes and letting them come at you out of the dark.

Whether what the CEO of Whole Foods did was malicious or just foolish is almost beside the point. What really matters is that so many leaders believe that deceptive actions and suppression of the truth are acceptable. That’s the thing to worry about.

When our leaders become ethically blind, they ought to forfeit the right to lead. It’s up to all of us to enforce that law, before the universe enforces it for us.

Sign up for our Email Newsletter

Technorati tags: truthfulness honesty business ethics standards of leadership facing the truth

Learning the art of pure selfishness

Why time spent on office politics is time wasted . . . yet often essential for survival.

People are political and emotional creatures. We like to believe we use reason to work out what to do, but this is an illusion. A far more general tendency is to make a decision largely on the basis of politics or emotions, then use reason afterwards to justify what we have already decided. Here’s how it works and why it may increase your stress.

It’s half an hour before official closing time on a Friday, after a hectic week. A customer calls with a complicated, urgent request that will take at least three to four hours to handle. Do you put it off until Monday, even though the customer is desperate for a resolution? Or do you deal with it right away?

Someone who is angry, frustrated, or just feeling low will be most likely to shelve the whole problem until Monday, arguing it is the customer’s fault for waiting until the last minute, or claiming the work will be better when he or she is fresh on Monday. An employee who fears the customer, or the boss’s reaction if the customer complains, will likely deal with the problem right away, but rush through it as fast as possible, even if that means a skimped job. Someone who hopes to make a big new sale to that customer, or is keen to make a good impression on the boss, may stay late to get the job done, or even come in on the weekend to make sure the work is done properly.

In most cases, this kind of decision will be made on a political basis. What will be the political impact of staying late and helping the customer right away? Will it win you “brownie points” in the eyes of some powerful executives (so long as you make absolutely sure they know about it)? Will it be one in the eye for some rival, who has designs on a sale to that customer that you might get instead, if you make the customer happy with you? Can you make it into an obligation the customer will understand they need to repay some time?

Whenever people are faced with a decision without clear guidance, especially in a culture where getting it wrong is likely to lead to nasty personal consequences, they tend to think about what others will make of whatever they decide—powerful others mostly. Will they approve or criticize? Will you trespass on (or be in a position to take over) part of someone else’s turf? How much freedom do you have to make the decision without consultation? Will it be seen as a favor that can be called in later? How else can you use it to your personal, selfish advantage?

All this adds to whatever thinking is needed by the job itself. None of it is going to improve the decision, the way that the job is done, or the result either. It’s a source only of extra, unnecessary concern and worry. It adds to whatever stress comes from the work itself or the deadlines to be met. It even causes additional work. If you decided what to do rationally and simply did it, then moved on to the next task, life would be simpler and less likely to cause you anxiety. But rationality is no protection from office politics, which are neither rational nor concerned with the success of the business. Office politics are about power, pure and simple—and strictly personal power at that.

The basic causes of office politics.

Fear is one of the commonest workplace emotions today. The greater the level of fear in the culture—fear of losing your job, fear of losing your status, fear of being marked down as a troublemaker—the greater the need to worry about the outcome of whatever you do and seek some kind of reassurance or safety. Office politics seems to be able to help. By consulting someone who has influence, seeking protection, or avoiding anything that might upset a powerful person, you can gain a measure of safety and reassurance.

Turn this around, make yourself the person with power instead of the one who’s afraid, and you have another reason to waste time and effort in politicking (In strict efficiency terms, of course, it is clearly wasted). Patronage, the power of advancing friends and protecting them from harm, is the main benefit of becoming politically influential. People who aspire to political power are keen to find ways to use and extend their patronage, usually by offering protection and support to their friends when difficult decisions are to be faced. Conversely, making sure that people are clearly seen to have failed is an obvious way to destroy your rivals and lessen their power.

That’s why office politics play a significant role in many decisions. Each offers scope for extending patronage (adding more grateful people to your circle of dependents), lessening the influence of your competitors, and making you look good in the eyes of people with more power than you have at present.

In none of these cases does the politics assist in productivity, raise profits, add value to the customer, or provide anything else positive. What it does do is help people cope with negative situations due to uncivilized workplaces dominated by macho, power-crazed people. That’s why the most pervasive politics are found in macho corporate cultures, or those where fear has become a way of life.

So long as fear exists, there’s no practical way around this.

All of office politics depends on these three motives: to add to your power of patronage and lessen the standing of your rivals for power; to buy you protection from someone more powerful than you are; or to advance your merit in the eyes of people with greater power. None of these motives is to the benefit of the customer, the organization, or anyone beside yourself. Any loss from a political maneuver is always designed to fall to some real or imagined enemy.

How many talented people are held back, prevented from making a full contribution, or persuaded to leave (or even fired) because of purely political choices by someone? How many wrong decisions are made because they offer personal advantage to powerful people? How much time and money is wasted in activities with no rationale beyond providing an opportunity for playing politics?

All office politics is ultimately stressful and harmful. It is the art of pure selfishness made to look rational. Any organization where it thrives is less a group engaged in a collective enterprise and more a warring, competing, back-stabbing collection of individuals trying to advance themselves at the expense of all the rest. If that’s the culture, standing aside is no real option, since it virtually guarantees that you will be either marginalized, humiliated, or ejected.

That’s the reality of many organizations today, I guess. They complain about shortages of talent, yet frequently act in ways that ensure many of the best people will leave. They cut jobs and slash vital projects to save money, yet allow cultures to grow that waste huge amounts of time and money on political activities. Instead of making sure the best people get to the top, they tolerate systems that reward those who are most politically active and successful, regardless of any other ability.

I am well aware that this is very unlikely to change. Those in power always want to preserve the status quo, since it is their status quo and they are the ones who benefit from it most. Nevertheless, it’s sometimes worth reminding people of what is being tolerated in the name of expediency. A very large proportion of those who leave corporate jobs to set up their own businesses do so to escape the constant politicking. Insofar as that adds to the variety and creativity of the economy, and creates new endeavors, perhaps some benefit is ultimately there after all.

Sign up for our Email Newsletter

Technorati tags: office politics corporate culture macho management patronage at work power and influence

Thoughts about honesty

I don’t agree with everything in this article (it’s too kind to conventional management ideas, for a start), but it’s still an interesting read (See clips below). But I do agree that honesty has a power and a credibility that lying, hype, and spin can never match.

Why has honesty become so endangered? Mostly because so much in today’s world of management is not working well, but no one wants to own up to the fact and face changes.

There are maybe a few people who lie for the fun of it, but I don’t honestly think that’s a common trait. Most people who lie do so because they think that it’s the best option: the only way they can imagine out of a situation that’s going to be worse if people discover the truth. They lie to save themselves time, trouble, or embarrassment. By doing so, they often store up even greater problems for the future. But, given most people’s constant short-term viewpoint, they don’t consider that.

Without honesty, there cannot be trust. Without trust, everything in the corporate world is harder to accomplish. Sadly, Hamburger Managers have been induced to believe that you can replace trust (which takes time, honesty, and openness), with instant answers, such as money incentives, threats, bullying, and constant harassment. Honesty doesn’t figure in macho management styles because those styles nearly always have too much to hide.

Hamburger Management is putting style before substance, in the hope that doing so will lead to quick results that cost little or nothing. Take all the mania about lowering costs. Sure, doing so will hike profits (for a time), but only so long as sales remain the same. If cutting costs lowers quality and usefulness, and sales fall, you’ve just shot yourself in the foot. Making a better product, providing a better service, even if it costs more, may well drive sales up by much more that the extra cost. Those profits are much more secure and long-term ones.

One of the most tarnished rituals of the corporate year is the performance appraisal. It ought to be about honest, two-way feedback. It’s more often about fudging problems, concealing screw-ups, finding ways to avoid paying a salary increase, or producing “evidence” to justify firing people. Everyone hates it and nobody trusts it. So why do it? Because having some kind of “justification” for subsequent management action will, hopefully, ward off legal reprisals. Because it allows central management to control costs (especially salary costs) by fixing “standards” that limit increases, regardless of actual performance. Just about everyone knows that the results are fixed in advance. How would you feel about elections that were rigged? That’s about the amount of honesty and credibility many people attach to performance appraisal results.

We live in a world where hype, spin, and other euphemisms for lying have become accepted. Is this a sign of civilization? You won’t ever stamp out dishonesty and lying, but I see no reason to encourage either by dignifying it with the status of a management technique. Lying is lying, whether politicians, marketers, HR professionals, or senior executives do it.

clipped from www.huffingtonpost.com

One of the truest is honesty is not just the right thing to do, but the perhaps the most potent weapon in business. Honesty has become an endangered species. Yet it’s incredibly potent, whether the news is good or bad. “We cannot meet the deadline.” “That is my best offer.” “You’re hired.” “You’re fired.” Honesty isn’t just the right thing. It’s effective. But rare.

Conversely, witness the spate of tarred executives from once-respected companies, who massaged, inflated, and drastically altered financial statements to make things seem better than they were, or hide their own personal excesses. Enron, Tyco, Adelphia Cable, HealthSouth, WorldCom, and others still in court.

The fact is, there’s no such thing as a good liar. Just think of how many lies have you been told today? “He’s in a meeting.” “ That’s our best price.” “It’s guaranteed for life.” “ You have my word on it.” “That stock is sure-thing.” “This won’t hurt a bit.” “ Your call is very important to us.”

Beware! Ever more egotists are at large . . . and they're dangerous

Egotism has always been common amongst leaders. Now, thanks largely to growing acceptance, it’s becoming an epidemic.

One of the the more malign impacts of today’s macho, fast-paced leadership style is the spread of unchecked egotism. Thanks to the media, with their sanctification of people such as Donald Trump and Martha Stewart, egotism is in danger of becoming not just acceptable but even “cool.” Does that matter? Yes, it does, because being involved with others, and interested in their welfare as well as your own, is the basis for both an ethical outlook and a commitment to honesty. More egotists mean less concern for anyone else, and that makes exploitation, dishonesty, and callousness more common.

Macho types have no time to get involved with people, save as useful “networking contacts,” to be exploited for their own benefit. Exploiting others to serve their own advancement seems quite logical and is done with no sense of shame. Indeed, like all egotists, they have no real interest in dealing with most other people at all, beyond the minimum needed to get the job done. They aren’t interested in anyone else’s problems, because they aren’t involved. Nothing is important, save what relates to them personally, and the people they want to impress or use in some way.

Of course, we are all guilty of egotism at times. It’s natural to be more interested in your own needs than the needs of others, at least for some of the time. What becomes unnatural—even dangerous—is the viewpoint that dismisses anything and anyone as important only insofar as it conveys some direct benefit to you.

How do many of today’s executives sleep easy, having deprived others of their jobs to boost short-term profits (and their own stock options)? How do they find it so easy to justify cost-cutting decisions that have no other purpose than to please Wall Street? They are mostly dedicated egotists, and as such they aren’t much involved in anyone else’s world. So it’s easy to minimize or disregard those consequences of their actions that fall on others. They don’t feel for the people whom they use or misuse, because they’ve forgotten that they’re dealing with fellow human beings. In the rush and hurry to satisfy their own needs and ambitions, other people seem more like machines or objects—sometimes useful, more often an irritant or a distraction.

Speed, macho beliefs, and egotism are incompatible with empathy. Egotists have no time or interest in recalling what it feels like to have someone dump their frustration and annoyance on you, just because you didn’t do exactly what they wanted when and how they wanted it. No time to remember that the other guy wants a stable job and a good income, just as they do. The higher and faster the high-fliers go, the more the world gets split into them (the important part, with so many things to do) and others (the unimportant elements that get in the way and have to be pushed, cajoled, or coerced into doing whatever they want for as little outlay of time, money, or attention as possible). As a non-participant in anything but their own concerns, these Hamburger Managers have no need for courtesy, politeness, ethics, or patience—and no time for anyone save themselves.

Human life—real, valuable, joyful human life—is all about participation. We are all part of the same world, intimately connected, however much some people want to keep others out. If you have no time to participate in this shared world, you have no time to live. If you cannot spare the time to help or empathize with others, why should they give you support and understanding when you need it most? You’re the person who ruined their day with your imperious demands, or walked right past them with your mind fixed on the next item on your agenda, or sent them the pink slip.

All our joys and triumphs are greater when shared. Our griefs are lessened by others’ sympathy and understanding. We cannot opt out of links with others and remain fully human. Those who do, even just mentally, lose their humanity and become capable of every kind of cruelty and dishonesty. Look at just about any dictator you care to mention, past or present.

Without any sense of obligation to our fellows, there’s no basis for behaving ethically or honestly. Sure, you might get caught, but it’s easy to ignore that possibility when the rewards of screwing over everyone else for your own ends are so obvious. When you divide other people into two simple classes, those who matter because they can help you advance, and all the rest, you will have no shortage of supposedly unimportant people whom you can cheat, exploit, harass, or bully at will. If the behavior of some bosses is little short of disgusting, it’s mostly because they feel neither shame nor concern at what they do—and nor, it seems, do many of their superiors.

Do we want to live in a world where politeness, gratitude, understanding, honesty, ethical dealing, and patience have become extinct? Where everyone is locked into their own bubble of petty concerns and nobody cares about anything else? Where rising to the top in career and financial terms means opting out of involvement in “unproductive” activities like friendship, helping others, and just taking time to appreciate the beauty and wonder of the world itself?

Slow Leadership isn’t just about creating civilized workplaces. It’s part of a wider need to create a more civilized world for everyone, free from the jerks and assholes whose egos are bigger than their brains.

Recommended reading: The No Asshole Rule: Building a Civilized Workplace and Surviving One That Isn't, by Bob Sutton.

Sign up for our Email Newsletter

Technorati tags: business ethics corporate ethics workplace ethics empathy participation corporate culture Hamburger Management Slow Leadership

Who is the highest flier of them all?

Is egotism necessary to achieving leadership?

Most high fliers are self-confident and have plenty of self-esteem. When they look in the mirror, they like what they see. It’s assumed that people with low levels of self-esteem rarely make it to the top. They won’t take the risks needed; the bold, opportunistic decisions that bring personal and organizational success. Maybe. But sometimes, self-confidence definitely goes too far.

Narcissism is egotism gone mad. It puts the self first and anyone and everything else a long way behind. Everyone must recognize the narcissist’s superiority. No one must challenge or question it. While a healthy degree of self-confidence is seen by many as a necessary attribute in achieving success, narcissism takes egotism and self-confidence to an extreme degree.

The Ancient Greek myth of Narcissus is a warning of what happens when self-esteem gets out of control. Narcissus was a beautiful young man who fell in love with his own reflection in a pool and ended up being turned into a bunch of flowers, forever gazing at their beauty in the water below.

It used to be only dictators who made themselves into crazed narcissists, stomping around in Ruritanian uniforms surrounded by sycophantic toadies, like Charlie Chaplin in “The Great Dictator.” Historically, some became simple figures of derision. Most added viciousness and cruelty to their delusions and brought death and shame on their countries.

Recent history has shown many instances of CEOs and other top executives who clearly suffer from narcissism. They’re so obsessed with their own importance that only constant adulation from colleagues, and continual media attention, can satisfy them. They’re obsessed with being seen as superior. They exaggerate their abilities and ignore the contributions of others. A few are quite ready to use lies, creative accounting, and criminal acts to try to make reality fit the demands of their colossal egos.

Sadly, narcissism isn’t only found in a few people at the top of organizations. It is an affliction of many bosses. When it strikes, it causes them to claim ideas their subordinates dreamed up, belittle other people’s achievements, and demand unquestioning “loyalty” and adulation from all around them.

This behavior often serves the narcissist rather well on their way to the top. They exude confidence. Many are intelligent, obviously ambitious, and ready to undertake any risks to win that coveted recognition. The organization is dazzled by their appearance of leadership and readily forgives “minor” faults like egocentricity.

Today’s “grab and go” management style and obsession with short-term results is tailor-made for narcissists. It offers a sure route to recognition—provided that you don’t care who else gets hurt, stressed, or burned out to fuel your path ever upwards.

Only later does the true nature of the narcissist appear. To win continual recognition, many sacrifice integrity, honesty, ethics and all civilized and humane values. They surround themselves with adoring acolytes, pushing aside real ability with its annoying habit of questioning their ideas. As we have all seen, some will even sacrifice the good name and survival of the business itself to feed their narcissism.

What’s the answer? It’s probably too much to expect the media and the public not to be carried away by surface “flash,” but there’s no excuse for organizations who join in. It’s not hard to spot a narcissist. Clarity of thought and firm values can ensure that true ability isn’t set aside by the more fashionable, fake variety. In nearly every bad situation, subsequent analysis shows the warning signs were always there; people simply ignored them in favor of going along with the flow.

A major part of being a Slow Leader is refusing to put the creative, rational part of your brain to sleep; taking time out to sort reality from appearance; valuing honesty above ambition; and sometimes having the courage to speak the truth, even when no one else wants to hear it.

So if you see some boss or senior executive spending too much time polishing his or her self-image, go buy yourself a bunch of narcissi and put them somewhere prominent to remind you of what may happen to you, unless you take heed in time.

Sign up for our Email Newsletter

Technorati tags: narcissism egotism egotistical boss self-esteem self-confidence achievement

Loyalty and a culture of fear

One of the reasons that many people agree to long hours and extra pressure is a sense of loyalty: to the company, to the boss, to colleagues. Yet is such loyalty always admirable, or even useful? Are there times when being loyal is actually wrong?

Is loyalty to the boss and the company always admirable? Loyalty has long been prized by leaders; to be disloyal is typically seen as an obviously negative trait. Yet too much emphasis on loyalty can stifle dissent, dulling people’s willingness to tell the truth and use their creativity. If no one is willing to rock the boat by pointing out problems or faults, or suggesting new ideas, how many opportunities, mistakes or instances of questionable practice will be missed? When does loyalty become misplaced? Ought loyalty to be prized more than curiosity and independent thought? Curiosity is uncomfortable. Skeptics make you mad when they challenge what you’ve come to believe and automatically rely on; especially in areas that you don’t want looked at too closely.

In my career, I’ve experienced times when disloyalty was disruptive and killed any sense of trust. But I’ve also seen cases where too much unquestioning loyalty meant important issues were ignored or suppressed until it was too late. It’s made me wonder if open questioning of authority, short of defiance, may be essential if we’re not to lose our way. After all, the United States was created by people ready to fight my English ancestors for the right to live free from unquestioning loyalty to a sovereign.

Principles of a civilized working life

Socrates, one of the world’s most revered philosophers, described himself as a “divine gadfly” sent to stir up his fellow citizens and shake them out of their complacency. They valued his efforts so much they had him executed for “corrupting the young” by teaching them to think for themselves. He was just the first of the many martyrs for the three principles that perhaps best express a civilized life, at work or anywhere else: freedom, reason, and respect for others.

The more authoritarian and dogmatic the leader, the more they prize loyalty in their followers. Dictators—political and organizational—crush freedom and surround themselves with “yes-men,” eager to prove their loyalty by saying whatever the person in power will find most acceptable. The pressure to fit in and suppress unpleasant realities can be overwhelming. That loyalty stifles creativity and discourages people’s willingness to speak the truth about their leaders, themselves, or their work. Competitors ought to cherish excessively loyal organizations, where no one is ready to rock the boat by pointing out how fast they’re becoming obsolete.

The use of reason to find solutions to problems demands that people are free to speak their minds and question anything that doesn’t seem right to them. Excessive loyalty puts all the emphasis on an irrational belief in the wisdom of leaders and the correctness of organizational decisions. You don’t have to look far to find leaders who are not wise and organizations whose decisions were far from correct. Reasoning demands questioning and makes no assumption that those above you in the hierarchy always got there by merit or intelligence.

Surely respect for others should extend to respect for their opinions, concerns, and anxieties? To be respectful means to listen with an open mind and a tolerant outlook. You won’t find Hamburger Managers with either. That’s why they make such poor listeners. They think they already know everything useful, and they have no respect for anyone who cannot directly advance their prospects. Of course they demand loyalty, even though they give none to others.

Getting the balance right

Getting the right balance between loyalty and initiative isn’t simple. Loyalty is good for comfort and support, but bad for promoting initiative and truth-telling. Organizations need people who support one another. They also need those ready to see with different—even “disloyal”—eyes and bring uncomfortable realities into the open. Without them, everyone gets fat, dumb and happy—until the dam breaks. Teams are good for support but bad for encouraging initiative and truth-telling. At the same time, we need the sense of acceptance and stability that comes from being able to trust those around us.

If your unthinking assumptions are about to break under the pressure of change, shouldn’t you be thankful to those who draw them to your attention in time? What about the “disloyal” whistle-blowers who alert the public to hidden corruption and deceit? Aren’t they important and valuable people, often moved by a stronger sense of moral duty than the rest of us?

There is a way to reconcile loyalty with openness to uncomfortable truth. It’s based on exercising ethical choice. When people think through the ethics of trust, and the basis of their support for boss or employer, they can see where the balance lies between being honest (even if that involves dissent) and being disloyal.

In any culture that prizes loyalty above all else, fear becomes the major emotion: fear of doing or saying anything that might suggest dissension; fear of exercising individual freedom to think and speak. Sadly, some major commercial and political organizations seem not too far from producing exactly such a culture.

Few things in life are black-and-white, however much some people try to make them so. Failure to question received opinions quickly leads to ethical blindness. Unquestioning loyalty 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 to themselves and others. Our intellectual and personal freedom is too important to surrender it to help our masters shut themselves away from uncomfortable questioning.

Sign up for our Email Newsletter

Technorati tags: loyalty trust business ethics openness respect questioning

The Narcissistic Organization

Part 3 of a series on the illnesses of today’s organizational cultures

A narcissistic organization suffers from delusions of success and grandeur. From the outside, the organization probably seems to be nothing unusual. From the inside, in its own estimation, it can do nothing wrong. Every problem or setback is attributed to external situations beyond anyone’s control. Its leaders are portrayed as near geniuses and their every action or speech eagerly reported. Employees are expected to become cult-like in their devotion to the enterprise. So distorted does this kind of sick organization’s view of the world become that it eventually loses touch with reality. Many of the strategic mistakes and failures that seem so obvious to outsiders occur in organizations that suffer from narcissism.

Narcissism is especially prevalent in long-established organizations with a past track-record of success. They become so proud of their past, and so complacent about their prestige, that they no longer notice clear signs of pending problems and an obvious need for change. Just as psychotic organizations “breed” psychotic leaders, narcissistic organizations tend to have an unusually high proportion of narcissistic leaders fixated on issues of power, status, prestige, and superiority.

Here is how Professor Manfred Kets de Vries, writing in The European Management Journal (Vol. 22, No. 2, pp. 183–200, April 2004), describes the “reactive” (i.e. negative) narcissistic leader:

Reactive narcissistic leaders are not prepared to share power. On the contrary, as leaders they surround themselves with ‘yea-sayers.’ Unwilling to tolerate disagreement and dealing poorly with criticism, such leaders rarely consult with colleagues, preferring to make all decisions on their own. When they do consult with others, such consultation is little more than ritualistic. They use others as a kind of ‘Greek chorus,’ expecting followers to agree to whatever they suggest. Reactive narcissistic leaders learn little from defeat. When setbacks occur, such leaders don’t take any personal responsibility; instead, they scapegoat others in the organization, passing on the blame. Even when things are going well, they can be cruel and verbally abusive to their subordinates, and they are prone to outbursts of rage when things don’t go their way. Likewise, perceiving a personal attack even where none is intended, they may erupt when followers rebel against their distorted view of the world. Such ‘tantrums,’ re-enactments of childhood behavior, originate in earlier feelings of helplessness and humiliation. Given the power that such leaders now hold, the impact of their rage on their immediate environment can be devastating. Furthermore, tantrums intimidate followers, who then themselves regress to more childlike behavior.

How can you spot a narcissistic organization? Here are some clues:

• The members of the top leadership are revered and accorded almost god-like status.
• Employees treat the organizationally-approved way of thinking or acting as Holy Writ.
• No one ever admits to any mistakes. Problems are always blamed on someone else—often people outside the organization.
• People treat the bombastic, dictatorial behavior of certain bosses as justified by their exceptional status.
• Questioning any aspect of the organization is strongly discouraged. Objections to policy or procedures from outsiders are met by an amused and superior smile.
• Obtaining employment within the organization is seen as a life-changing achievement and a gift of immeasurable value, which must be repaid with unquestioning loyalty.

My own experience of narcissistic organizations confirms how easily they become a mutual admiration society, where employees act as if simply being part of the organization confers automatic superiority; and the leaders are more concerned to polish their image than take tough decisions. Such an idealized view of themselves and their organization quickly seduces executives into believing that they are in truth the wonderful managers and flawless business strategists that the organization’s PR has made them out to be.

One of the most negative aspects of working in a narcissistic organization is the way it forces everyone to take sides. Since narcissistic leaders typically show strong hostility to anyone who fails to give them the unquestioning loyalty to which they believe they are entitled, employees are faced with a stark choice: do what the leader wants or suffer nasty career consequences. Worse still, there will be no support from colleagues for any “rebellion.” As organizational “cult members,” people rapidly become like their leaders: deeply hostile to anyone who questions the prevailing organizational culture. Independent thought is squashed. Leaders are deprived of truthful feedback. The self-satisfied blindness that results can lead to catastrophe, as leaders are deprived of sensible reality-testing and followers provide sycophantic praise for personal gain. As Max McKeown wrote recently in Management Issues:

Far too many organizations are stuffed with sycophants prepared to overlook anything shady, illegal, or unethical as long as they are getting to hang around and share some power.

Narcissistic organizations breed arrogant, power-obsessed leaders and sycophantic, manipulative followers. The archetypal “organization man” is a product of a narcissistic organization. So is the status-obsessed CEO who believes that he or she is entitled to use the organization’s resources to demonstrate superior standing. And, since whatever demands the organization sees as “reasonable” must be met, narcissistic organizations quickly produce zombie-like employees who sacrifice any other parts of their life to the organization’s needs. There can be no work/life balance where employment in the organization is seen as such a stupendous gift.

Is that where you want to spend your time? The longer you stay, the less your capacity for independent thought will be, and the more you will come to believe that whatever the organization approves is automatically right. I have known several people who spent most of their careers in an organization of this type. In conversation, their constant praise for the organization quickly became embarrassing. It was also obvious that they formed an elite group, at least in their own estimation. For example, all agreed that in any problem situation, anywhere in the world, their automatic response would be to turn to the local branch of their organization for help and guidance. Not the authorities. Not friends or neighbors or family. Not even their own commonsense or critical thinking ability. If you hadn’t worked in their organization, you were automatically seen as somehow inferior.

Unless this seems an ideal world to you, don’t be tempted to work in such an environment. If you’re in one, and haven’t yet succumbed to group-think, start job hunting right away.

Sign up for our Email Newsletter

Technorati tags: corporate culture problem bosses problem organizations groupthink group-think loyalty submission leadership slow leadership

The Psychopathic Organization

Part 2 of a series on the illnesses of today’s organizational cultures

A psychopath is a person suffering with a personality disorder resulting in aggressive, perverted, criminal, or amoral behavior without empathy or remorse. A psychopathic organization is one where aggressive, cruel, dishonest, or twisted behavior is allowed without any concern about the consequences or impact on others. Being psychopathic means, essentially, having no discernible sense of morality or ethics. It’s the most common kind of organizational sickness today.

If you encountered a person who displayed overt aggression, treated others with callousness, manipulated them for his or her own profit without any sign of remorse, and practiced daily amounts of dishonesty without any feelings of guilt or anxiety—save for the concern not to be caught—what would you think? Would you praise their behavior as displaying sound values? Would you hold them up as a positive example to others?

I doubt it very much. People like this are typically diagnosed with a psychopathic personality disorder and treated, sometimes under compulsion. Most mass murderers are psychopaths. They are often charming, cunning, arrogant, manipulative, and extremely hard to catch. Even when apprehended, most show no sign whatsoever of remorse or even recognition that what they have done is wrong.

Sadly, very similar behavior is common in organizations today. Not so extreme, of course. Organizations don’t commit murder (usually). But many do display no discernible sense that manipulating others, exploiting the weak, increasing profits by various forms of unethical behavior, or even some levels of dishonesty (providing you don’t get caught), are wrong in any way. Worse, some of these psychopathic organizations become the darlings of Wall Street and the financial press, simply based on the vast profits that they generate for their shareholders and managers.

How do you recognize a psychopathic organization?

• There is no interest in anything other than making profits and winning out over the competition. Just about anything that achieves this end counts as “fair,” regardless of its effect on others. Anyone who shows scruples is dismissed as “weak” or a “pinko.”
• Cunning, devious, and manipulative behavior is seen as “clever,” so long as it leads to benefits for the organization. Rules are there to be circumvented. Laws are more often evaded than honored. The only “sin” is being caught.
• “Spin” is important; the truth is not. Fine sounding statements are made with a nudge and a wink to insiders. Lying in the “good cause” of corporate profits is treated as normal. There is little or no sense of remorse about virtually any behavior that improves the bottom line, however unpleasant, callous, unethical, or borderline dishonest.
• The organization is run by a clique who play by unwritten rules. Offending against those rules is unacceptable. Making the true motives and methods of the organization public—being a whistle-blower—will get you fired right away.
• The organization protects those who serve it best. You can get away with almost any behavior, just as long as you continue to turn in the results expected. Any investigation of such favored individuals will be suppressed. Those who don’t meet their targets receive no protection or help.
• There is a pervasive atmosphere of “us against the world.” Insiders can earn enormous sums of money. Progress and promotion depends on being seen as “the right sort:” someone who will play the approved games and close ranks against nosey outsiders—especially the authorities or any pressure groups that appear hostile to the organization’s single-minded pursuit of what it sees as its interests.

Spending any time within a psychopathic organization is extremely risky for your ethical and moral well-being. The only safe course of action is to get out as fast as you can. Extreme examples of organizational psychopathic behavior—Enron was the poster-child for this—lead to a very high risk of crashing and burning in spectacular fashion. You definitely don’t want to be around when this happens. But even less extreme versions of corporate psychopathology will put you under to constant pressure to fit in and accept that kind of behavior as normal.

Can these corporate psychopaths be cured? I think that they can, but only as a result of massive external pressure, and usually only after almost all the existing top management has been replaced. Leadership habits formed in a psychopathic atmosphere can be very hard to shake off, especially since the typical psychopath’s charm and cunning is deployed to make everything seem fine on the outside. Wall Street typically isn’t too particular about how profits are made, so long as no one gets caught out and the money keeps rolling in. That’s why organizations like this survive and seem to prosper.

The Roman emperor Vespasian was the first to raise money by putting a charge on public urinals. When some senators protested, he took a coin and waved it under their noses, saying: “It doesn’t smell, does it?” Today, quite a lot of corporate profit stinks to high heaven—but almost no one is out there sniffing.

Sign up for our Email Newsletter

Technorati tags: business ethics corporate culture corporate ethics Hamburger Management corporate responsibility ethical leadership slow leadership

The Pyschopathology of Organizations

Some of today’s organizations are psychologically and ethically sick. Maybe that is why the people who work in them begin to act in sick ways too.

Business thinking has fallen into a number of bad habits in the past few decades, but one of the worst is the assumption that bad actions, whether in the general office or the boardroom, are solely due to the personality, character, or ethical problems of individual perpetrators. Firing the people involved, or disciplining them in some other way, is seen as providing a total solution to such issues. The slate is wiped clean. This is not the case, as I will show.

We rightly expect people to be held accountable for their actions—especially those in positions of power and trust. Every action represents some more or less conscious choice, and we all need to acknowledge that our choices have consequences. Yet personal decisions, whether inspired by problems of personality, defective values, or ethical blindness, are far from the only factors at work when things go wrong. Organizations can become damaged, perverted, or just plain sick within themselves, just as much as individuals can. A single, mentally sick individual has pointlessly destroyed more than 30 innocent lives at Virginia Tech. A single ethically and procedurally sick organization can take away thousands of people’s jobs, destroy their pensions, or subject its workers to daily cruelty, humiliation, and exploitation.

Human organizations are hybrid entities: part mechanical systems and constructions; part human communities, with all the emotional and psychological baggage that entails. Probably the best way to see them is as biological entities. We humans, for example, have some largely mechanical parts to our bodies (bones and muscles), which grow and develop over time to provide the necessary framework. What animates and directs that framework is our brain: the thinking, feeling, judging part, with its own complex of automatic systems and conscious choices.

As our bodies may develop handicaps, sicknesses, and diseases, so organizations can become crippled and distorted.

In much the same way, organizations develop frameworks of systems, policies, money flows, and procedures, directed and animated by the human element. As our bodies may develop handicaps, sicknesses, and diseases, so organizations can become crippled and distorted so that their systems work in negative and destructive ways.

When that happens, the organization itself becomes sick and provides an unhealthy, even poisonous, culture and context for work. In time, if the people within it fail to take action to heal the sickness, they too are made sick by the context of negativity and the warped outlook all around them.

Stanford Psychology Professor Emeritus Philip Zimbardo conducted an experiment in 1971, using prison inmates, in which he showed how systems, situations, and roles involving power influence human behavior. His book, The Lucifer Effect: Understanding How Good People Turn Evil, isn’t an easy read. The examples are too often of horrific cruelty and abuse and the style is somewhat ponderous and hectoring. But the point remains that there is good evidence, culled from multiple sources, that sick organizational and social contexts quickly make the people within them act in equally sick and perverted ways. It’s just a question of which comes first: whether the apples in the barrel were bad, or (his view) the barrel was bad and infected the apples.

What we see all too often today are organizations rich in spreadsheets, but with withered or distorted hearts.

Within the business world, I suspect that there are both bad apples and bad barrels. We seem to be very aware of the first and somewhat blind to the second. Yet those in charge of organizations surely have the duty to correct or root out their own sick systems and attitudes, just as much as they have a duty to deal with badly behaved individuals. If we, as a society, ought to refuse to tolerate jerks in positions of power—as we certainly ought—we should also refuse to tolerate organizational systems and approaches that create more jerks, more cruelty, and more barbarism in our workplaces.

What we see all too often today are organizations rich in spreadsheets, but with withered or distorted hearts. Places where people are treated as costly but inanimate objects, to be exploited and casually discarded, not as fellow human beings with hopes, dreams, and feelings. Work in an organization like that for too long and you risk seeing that distorted situation as normal. You become infected with the sickness all around you.

Do businesses exist to create profits? Of course. Is it acceptable to create profits in any way that works? Surely not, just as it is unacceptable in a civilized society to extract information by means of torture, even if that method seems to some to be likely to deliver what is wanted.

Business and organizational leaders must be held accountable for more than the financial health of their enterprises. The emotional, ethical, and psychological health of those systems is also their responsibility. They would do well to give that much more thought than they do.

Sign up for our Email Newsletter

Technorati tags: corporate culture business ethics organizational structures leadership slow leadership

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?

Sign up for our Email Newsletter

Technorati tags: short-termism business ethics corporate ethics Hamburger Management leadership slow leadership