The Future of Power

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CEO, Gary Hamel, management theories, power, The Future of Management, theories in practice

Gary Hamel’s style is (even with his co-author, Mr. Bill Breen) seeping through every word in that book and, at least to me, is very sermon-like. I can even imagine Mr. Hamel preaching to us his ideas from a podium somewhere, pounding into our ears his thoughts. But apart from that his book is, of course, interesting enough. Its message is that current management practices and theories are outdated and new ones have to be created. Whoever does it first, will have competitive advantage over others.

Maybe, maybe not. I don’t know why but all scholars (or most of them) fail to see that great examples of new theories in practice are all about people behind them. When we remove those people (or if it wouldn’t be for them), there would be no Google, no GE, no Ford; and no innovations those people brought with them in their respective time and organizations. Unfortunately not every one CEO is Steve Jobs. Most are normal people, following whatever they have learned in schools with a dollop of their experience. Many are power-hungry and greedy. People don’t know how to manage differently except with power and top down hierarchies. Flat structures need time to spread, like a positive disease, before those too will be normal. We need to wait until the circle will turn and that can take decades. I guess Mr. Hamel knows this and through his book he tried to somewhat speed that process up. Good Luck.

Company of Good People

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CEO, great company, Harvard Business Review, Rosabeth Moss Kanter, social responsibility, values

Admittedly, I am a bit behind in my reading of HBR, this is why I address November issue only now. I have read in it a series of articles about the Good Company, started by an article by Rosabeth Moss Kanter “How Great Companies Think Differently”, followed by an interview with CEO (now emeritus) of Infosys, Mr. N. R. Narayana Murthy and finished by few examples of today’s good companies (although in those examples each company was good in a different area). For clarity’s sake “Good” for ideas and companies described in those articles means one or all of the following: social responsibility, sustainability, protection of values, community engagement etc.

As much as I am all for this kind of organisation, I hate to say it, but it doesn’t exist. It is not organisation, after all, which is Good. It is (or those are) always people. In all cases those are the people who are strong, committed, consistent and persistent enough (accidentally, all of those are true leadership qualities) who managed to turn companies they have been running into good citizens, making money in the process. The best proof of this can be found in the interview: CEO Murthy had a vision of running India’s most respected company and he managed to do so for a long time. But one day some people in the Infosys behaved against CEO’s values, getting themselves fired for sexual harassment or being subject of various investigations. I have to admit that reading that interview I had a feeling that Mr. Murthy stepped down because he realized that he cannot control all the people (apparently over 130000 employees) he was responsible for. Maybe he couldn’t convince everybody that his good values are also theirs. Each person has its own code – and it is people who make or break the vision. Each example presented in those articles has a person, an individual, behind it. Rules and laws don’t make a good company, as we all know. If that would be so, most of the companies in existence today would deserve to be called “good”.

A strong CEO with strong values can mold his company into socially responsible organisation, serving to all as a beacon in the darkness, giving guidance to all in doubt. His positive values and culture can permeate through all levels of the company, so that they will last very long. But it takes one wrong decision betraying those values to start the erosion process. Especially if that decision is made up top. As Mr. Murthy said: “…Setting an example at the top is the best way to instill confidence throughout the company”. Unfortunately, that example can go both ways. New CEO can destroy (or start destruction process) af all that has been painstakingly built.

 

 

Erosion of Values and European Labour Laws

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CEO, employment, European labour laws, HBR, Jim Collins, labour laws, organisation, politics, values

Prevailing theme in most of publications today point out to lack of proper values as one of the reasons for the predicament we find ourselves today. Erosion or lack of values on part of various politicians or financial gurus has forced us all to have to deal with consequences. It seems that all of a sudden we appreciate those values more, proof of that can be found for example in the following HBR article here as “…self-awareness, intrinsic motivation, empathy and social relationships”, where this list builds (in addition to IQ) the EQ part of the future CEO. I am sure though that we have to look for those in any middle manager or even worker, as those are not subjects you can learn at schools. You have them or you don’t. As a side note – funny enough this list does not have honesty in it.

If then a candidate to CEO should show, in between others, “character, values and integrity”, be “inspiring, courageous and compassionate”, have “productive relationships with colleagues, partners, and other external stakeholders” (following the same article) then we can easily presume that managers or workers should have them as those are true internal candidates for directors and then CEOs. Consequently, the more of people are having those in your organisation, the better.

This conclusion is also confirmed by a book by Jim Collins “Good to Great: Why Some Companies Make the Leap and Others Don’t”. One of the advice listed there, which by the way I find to be one of the most important, is to “… get the right people on the bus”.

At this point is where I think the problem starts. Should your organisation be lucky enough to have CEO showing values listed above, he should, in order to bring your organisation to greatness, surround himself with people of similar values by getting them on the bus. Of course before he will be able to do that, he needs to get the wrong people off the same bus. That change of personnel is, more often than not, vital for the organisational survival or for it to start making way toward prosperity or profitability; meaning that the quicker it is done, the better for all concerned. Unfortunately, the labour laws in Europe don’t list “wrong set of values” as a good enough reason for termination of employment. If the worker (manager, director, whoever) is not doing anything considered on paper as wrong, it is very difficult to get rid of him/her. Of course there are legal ways of firing such people – those ways though take time and in most cases are heavily political.

Notice one more thing: people like to surround themselves with their own kind. Hence good CEO (not only as a businessman, but also as a person) will want to surround himself with good people. Bad managers choose the same “crooks” as they are as their companions, maybe because she can understand them (and relate to them, trust them) better. That also means that a newly imported CEO will not only have to fight lengthy battles with labour laws, but also with entrenched political fractions at his new home. Unfortunately, many such CEOs lose those fights. Consequently, we do as well – one of the signs that we do is the fact that we have to import a CEO from outside. In addition to all the excuses, having to do so means for organisation that there is no one inside worthy the job.

Today there are psychological tests and other tools available to all HR managers out there, maybe a solution lies not only in mentioning good values in all publications, but also in making them truly vital part of any employment process. I am all for it, even though surely European labour laws are not the only source of our problems.