Minding Gaps

The Constant Peril of Slipping Backward

 

by Thomas J. Lee

Even for the best companies, it is always easy to slip back into mediocrity. They just stop embracing change. Soon they are no longer ahead of their peers. They're only keeping pace, if that.

It is always much more difficult to continue moving forward into the unknown. That requires real leadership—and not just at the top of the organization but up, down, and across it.

Leadership is essential because its work product, its deliverable, is the full engagement of people throughout the organization. Getting that engagement, keeping it, and building it requires a deliberate focus of its own. That deliberate focus is the stuff of leadership.

© Copyright 2012   Arceil Leadership Ltd.   All rights reserved.

University of Illinois President's Stormy Tenure Is A Sad Case Study

by Thomas J. Lee

Michael Hogan's stormy tenure as president of the University of Illinois, and his resignation yesterday after only twenty months on the job, offers yet another case study on the importance of humble, servant leadership and on the critical role of respectful, mutual communication as its energy and light.

Here are a few articles for background: the Chicago Tribune's account of the resignation, the Chronicle of Higher Education's report, and the Chronicle's earlier piece (from March 8) on Hogan's communication problem with faculty at the University's flagship Urbana-Champaign campus. It is a sad case study indeed.

My main question is intended to spark more intellectual curiosity than anxiety, but I cannot help expressing it with a tone of frustration: Just when will leaders learn?

If anyone should have had some sensitivity to the challenge of real leadership, you'd think it would be a historian of diplomacy like Hogan. But no, even he committed some of the most egregious blunders we have seen in quite some time. Read the three articles to see for yourself.

Last month the University's faculty protested. More than a hundred of its senior professors, the big names the University of Illinois cannot afford to lose, called for his ouster. Their complaints were classic: micromanaging, arrogance, bullying, insularity, and more. Above all, the complaints zeroed in on a profound lack of respect and empathy for the people Hogan sought to lead. Like too many leaders, he seemed to think it was all about him.

The situation boiled over this week. Hogan said he had had enough, and he decided to quit.

I fear that many putative leaders in business are in similar situations, but in their case, people don't speak out for fear of retribution in an uncertain economy. (The senior professors who called for Hogan's resignation are protected by academic tenure.) 

Hogan, and leaders everywhere, would do well to heed the words of Benjamin Disraeli, the 19th century British leader: "I must follow my people," Disraeli said. "Am I not their leader?"

 

© Copyright 2012   Arceil Leadership Ltd.   All rights reserved.

More Employers Ask Job Applicants for Facebook Passwords

by Thomas J. Lee

I am not the least surprised, but I certainly am flabbergasted, that more employers are asking job applicants for Facebook passwords.

It isn't surprising, because many companies have long misunderstood the concept of trust in the workplace. They have assumed that employees should just naturally trust them, without themselves first earning the trust of employees or first investing the same kind of trust in employees.

Life just doesn't work that way. Trust is and always has been a two-way street. It must be earned, and it must be shown. He who doesn't trust is only rarely and briefly accorded any trust. That is as true in our professional lives as in our personal lives.

Trust is far too precious and far too tender to be treated as if it can be presumed or commanded.

If not surprising, these policies are nonetheless flabbergasting. They set the tone for brazen disregard for employee dignity. What company would want employees who are so deferential, so servile, as to tolerate that? 

If I were in charge of the hiring at these companies, I might actually ask for a Facebook password just to see which job applicants would refuse to provide it despite expecting that it would cost them the job. Those are the applicants I would be inclined to hire. In the long run, they will stand up for integrity and for their own dignity. How refreshing.

Give me an employee who knows right from wrong, smart from stupid, trust from mistrust, decent from indecent. I can build a fine company with people like that.

 

 © Copyright 2012   Arceil Leadership Ltd.   All rights reserved.

Goldman Sachs Replies to Mr. Smith

 

Here is a response from Goldman Sachs to the essay by Greg Smith published in this morning's editions of The New York Times and referenced in my own blog post (just scroll down).

Backlash Against Goldman Sachs Op-Ed Writer Begins in Earnest - Business - The Atlantic Wire.

In the interest of fairness, I recommend reading it as well as Mr. Smith's essay.

TJL

Greg Smith's Very Public Resignation

 

by Thomas J. Lee

Until today, Greg Smith was executive director and head of the U.S. equity derivatives business in Europe, the Middle East and Africa for Goldman Sachs.

He resigned out of disgust—that isn't too strong a word, as you will see—with Goldman's culture of putting profits before customers. Moreover, he submitted his letter of resignation to The New York Times, which obliged him by printing it today. Online and in print, it's fair to say that millions of people will ultimately read it.

You can read it for yourself here: Greg Smith resigns from Goldman Sachs. Don't miss it.

Reasonable people can debate whether Mr. Smith should have gone public with his thoughts. The fact is he did. It's done, and his thoughts are out there.

In his shoes I wouldn't have done the same thing, but if it compels Goldman and other large investment banks to rethink and change their culture, then it may be worth it.

Here are some questions for any business leader to think about:

• Do you think Goldman's senior management has viewed its culture the same way Mr. Smith describes it?
• Do you think Goldman's executive team regards the firm's culture as "the secret sauce" of its success, to use Mr. Smith's phrasing?
• How important is your own firm's culture? How would you describe it, and how do you think others in the company describe it? How do customers describe what they see of it?
• Does your organization truly put the customer before the profit? In what ways do you see this as the reality?
• How should you change the culture of your organization? How can you?

 

 © Copyright 2012   Arceil Leadership Ltd.   All rights reserved.

A Case Study in Poor Executive Communication

Here is an unfortunate but instructive case study on executive leadership that underestimates and undervalues the challenge of communication as the energy of leadership.

It involves the troubled president of the University of Illinois, and it appeared in the Chicago Tribune today.

U. of I. president says he did poor job of connecting with faculty.

 

The Three Essential Components of Any Leader's Credibility

by Thomas J. Lee

Back in the 1980s a onetime IBM salesman and singing cowboy by the name of Robert Fulghum wrote a little book that became a worldwide sensation. All I Really Need to Know I Learned in Kindergarten stayed atop the best-seller lists for two solid years. It was translated into 27 languages and sold in more than 100 countries.

As the title suggests, this marvelous book asserted that the really important verities of life we learn as young children. Perhaps nowhere is that more true than in communication, especially for the sake of leadership.

Consider what we learned about communication as youngsters on the playground:

• Thou shalt not lie.
• Practice what you preach.
• Actions speak louder than words.
• Sticks and stones can break my bones, but words will never hurt me.
• Seeing is believing.

In other words, we learn early on that credibility is the currency of communication. We learn that we cannot get away with just saying whatever we want, when we really don’t mean it. Other people resent and dislike that, and they will resent and dislike us.

As we grow into adults, we come to appreciate the significance of this. We realize that all the fast and fulsome talk in the world cannot buy the allegiance and dedication of people: our kids or our employees or our constituents. Only our credibility as leaders can do that. Without credibility, our communication is like counterfeit money.

Moreover, we realize that the measuring rod of credibility does not belong to us as leaders. It rather belongs to the people we seek to lead. They and they alone measure our credibility. If they find it in our leadership, we and they can go anywhere. If they don’t, we and they can go nowhere.

Those of us who think a little longer about the challenge of credibility also realize that, when we begin to assert ourselves as leaders, credibility becomes more elusive and difficult. It begins with simple trust, for sure, but it also seems to demand more than trust alone. It also requires respect and affinity with people.

By trust, we have in mind a high regard for the veracity of one's word. People who trust someone believe the person is telling the truth. The truth that he tells may be a factual depiction of reality. Or it may be a sincere statement of intent, or a frank and honest description of his opinion, values, or perspective. Whatever path it takes, it must square with reality.

By respect, we're referring to a high regard for the leader's command, control, and competence: his ability, energy, initiative, resources, and perseverance—in short, his authority. In the colloquial, this quality is often referred to as "street cred." People must recognize and respect a leader's capacity for situational authority in order to believe he is capable of accomplishing that which he is setting out to accomplish.

By affinity, we mean a high regard for a common bond of interests, needs, and concerns. Apart from someone under the hypnotic spell of a cult, no one willingly follows a leader whose purpose runs counter to their own well-being. Rather, people look for nobility of intent: an honorable purpose that aligns with their own well-being. What is important and valuable to the leader must be, or must become, important and valuable to the people she would lead, and vice versa.

One or even two of these three cornerstones is not enough. Respect and affinity in the absence of trust leaves a residue of doubt. Affinity and trust in the absence of respect leaves a residue of skepticism. Trust and respect in the absence of affinity leaves a residue of opposition. Leaders need all three: trust, respect, and affinity with people.

Now most of us didn’t actually learn this part in kindergarten. Those who never learn it at all will never capture the hearts and minds of people. They will never lead.

 

 © Copyright 2012   Arceil Leadership Ltd.   All rights reserved.