“Well written and an interesting perspective.” Clan Rossi --- “Your article is too good about Japanese business pushing nuclear power.” Consulting Group --- “Thank you for the article. It was quite useful for me to wrap up things quickly and effectively.” Taylor Johnson, Credit Union Lobby Management --- “Great information! I love your blog! You always post interesting things!” Jonathan N.

Tuesday, March 15, 2011

Fraud as Fair: Lehman as Beneficiary of Society's Pro-Business Cultural Values

In 2010, Richard Fuld, the former CEO of Lehman Brothers, told a congressional committee that he had "absolutely no recollection whatsoever of hearing anything" about Repo 105 at the time of the transactions. Lehman's demise, he claimed, was caused by "uncontrollable market forces" and the U.S. government's unwillingness to rescue the firm. Of course, Henry Paulson, the U.S. Treasury Secretary in 2008, had tried in vain to get Fuld to accept a buyer offering a reasonable price; Fuld had been holding out for more in spite of the financial condition of Lehman. It is stunning that a man who had been allowed to reach such a pristine and lofty office in the business world would not even permit himself to acknowledge any contributory role in the downfall of the organization he had run. Such an attitude alone seems worthy of a prison sentence (and the return of his salary and bonuses); how he and his "team" had manipulated the books to make the bank look wealthier than it was would seem to make such a sentence inevitable.

The full essay is at "Fraud as Fair at Lehman Brothers."


On greed, see related essay, "Godliness and Greed": http://thewordenreport.blogspot.com/2011/02/godliness-greed-how-effective-is.html

On Lehman's corporate governance, see: http://thewordenreport.blogspot.com/2011/02/godliness-greed-how-effective-is.html

Sunday, March 13, 2011

Eight Good Behaviors of Managers: Googled by Google

The New York Times reports that in early 2009 at Google, "statisticians . . . embarked on a plan code-named Project Oxygen. The 'people analytics' teams at the company produced what might be called the Eight Habits of Highly Effective Google Managers. 'My first reaction was, that’s it?' says Laszlo Bock, Google’s vice president . . .  for human resources. 'The starting point was that our best managers have teams that perform better, are retained better, are happier — they do everything better,' Mr. Bock says. 'So the biggest controllable factor that we could see was the quality of the manager, and how they sort of made things happen. The question we then asked was: What if every manager was that good? And then you start saying: Well, what makes them that good? And how do you do it?' He tells the story of one manager whose employees seemed to despise him. He was driving them too hard. They found him bossy, arrogant, political, secretive. They wanted to quit his team. 'He’s brilliant, but he did everything wrong when it came to leading a team,' Mr. Bock recalls. Because of that heavy hand, this manager was denied a promotion he wanted, and was told that his style was the reason. But Google gave him one-on-one coaching — the company has coaches on staff, rather than hiring from the outside. Six months later, team members were grudgingly acknowledging in surveys that the manager had improved." (1)

Analysis:

"What if every manager were good" sounds a lot like "What is everyone were above average?" One might reasonably ask: In what sense good?  Good people as in kind-hearted?  Good as in having mastered managerial skills?  Or good as in having a good style--meaning that it fits the particular corporate culture? The question of what makes a manager good hinges on what is meant by "good." In the case of the bossy and arrogant manager at Google, I contend that what was "bad" was not limited to or sourced in his style; rather, the problem was his personality, which transcends style. Arrogance, for example, is a basic attitude rather than a style. It is no surprise that "coaching" (a mismomer outside of sports even if a fad in business circles) did not turn the guy around. It sounds to me that the guy needed therapy or counseling. That Google would reduce a "bad" personality to leadership style and prescribe "coaching" rather than a therapist is no accident.

It is commonly taught in business schools and believed in business settings that the science of management is applicable for virtually any business in any industry. In fact, one can theoretically manage a "team" (another misnomer from sports--is business really so boring that such faddish terms need to be borrowed and used out of their context?) without having any skill or knowledge particular to the product.  The idea, in short, is that anything can be managed, and that knowledge of the particular thing is not requisite. Hence it is not surprising that managers would overstep onto psychology without having a knowledge of that field. What is actually a psychological problem is thus transmuted into managerial terms such as "style" and "coaching." Personality, in other words, is reduced to the extent to which it fits within leadership and the manager is assessed from the standpoint of leadership style (e.g., task vs. relationship). Moreover, reducing managing to behaviors, as if that which is inside the manager is a black box, is to ignore that which separates the mice from the men as managers in terms of getting along with others (i.e., "good" as interpersonal relations).  In other words, improving a manager's "style" by trying to change (manipulate?) her behavior is apt to be insufficient. It is like paddling a row boat without moving the anchor; the boat isn't going to move very far.
With this in mind, I turn now to critique the "Eight Good Behaviors" that the good people at Google recommend.
  • Be a good coach. Included: provide specific feedback without being too negative and "present" solutions to problems. But isn't this just management?  I don't see much actually transferred from what coaches do in sports.
  • Empower your team and don't micromanage. Freedom vs. advice. Challenge the "team" with "big" problems. Sounds like this was written by a "team" of kindergarden teachers (no offence to the latter). Empower is a faddish politically-correct term that is rarely defined adaquately. With regard to micromanaging, every micromanager I have encountered has had control issues--meaning psychological problems involving or impacting personality and interpersonal conduct (but not rooted in conduct, or style!).
  • Express interest in team members' success and personal well-being. Get to know about their lives outside of work and make new team members feel welcome. Helping new people to feel welcome is laudable; it is perhaps the area where a manager can truly be most human. Success, however, is a vague term implying an ending (e.g., Did you succeed in getting the kids to sleep last night?), whereas business typically is ongoing and thus not like a race or contest.  Another unsuccessful analogy unless used for particular tasks that have a clear end-point.  With regard to getting to know things about subordinates outside of work, this can be viewed as invasive and with a hidden agenda (e.g., to manipulate better "performance"). Also, ethical problems can arise if subordinates feel pressured to discuss matters such as their religion and politics. If a manager, as a human being, is genuinely interested in other people at work, subordinates will likely sense it; otherwise, they could feel manipulated.
  • Don't be a sissy: Be productive and results-oriented.  Focus on the "team" setting achievement goals and priorities.  We are back to kindergarden language (e.g., sissy and be productive!) and to what is essentially management itself (which is inherently geared to producing results). A business is a results-oriented enterprise.  A focus "on what employees want the team to achieve" belies a manager's true intention to set goals for the people working under them.
  • Be a good communicator and listen to the team. Two-way communication. "Hold all-hands meetings and be straightforward" in communicating . . . Encourage open dialogue and listen." All-hands? At any rate, should we really be encouraging managers to have more meetings?  Being straightforward is laudable, however, as is open dialogue. The question is perhaps whether this is even possible where managers view their subordinates as lower. In other words, can there be straightforward dialogue where there is a power relation between boss and employee?
  • Help your employees with career development. Here too, the difficult matter of being able to be straightforward is relevant, given how organizational politics and a manager's own interests can relate to others' career development.
  • Have a clear vision and strategy for the term even in the midst of turmoil. Involve the team in setting the vision.  Here is yet another vague analogy that has been a fad: leadership vision. How does this differ from coming up with a goal? Has anyone in the study of leadership or management successfully defined vision?  The think about faddish words use as weak analogies is that people can use them without knowing what they mean--even as they are using them! Everyone just sorta looks the other way rather than asking: well, what do you mean exactly by vision as distinct from goal-setting? Long-term goal setting?  But is that to have sight or merely to plan further out? Lastly, the use of the word turmoil, particularly when one considers how a turbulent business environment pales in comparison with the protests in the Middle East and the Japanese earthquake in 2011, seems to be excessive. Do managers have a tendency to overstate--or overdramatize--what they face on a daily basis?
  • Have key technical skills so you can help advise the team. Work side by side with your subordinates when needed and understand the work they are doing. This principle, or "habit," challenges the notion that a person can learn management skills and apply them to virtually any business--knowledge of how to make the particular product being unnecessary.  I suspect this is an American view of management. The Japanese have traditionally hired managers from the factory floor precisely because they are familiar with the technical skills being used to make the particular products.  A good manager, I contend, is one who is already proficient with most of the tasks of his or her subordinates and can therefore help out when needed.  So it would appear that Google got one right.
1. Quoted from: http://www.nytimes.com/2011/03/13/business/13hire.html?pagewanted=1&_r=1&ref=todayspaper

Click to add a comment or question (or view posted comments) on leadership or management at Google.