Where does the buck stop? Who’s responsible? These questions have taken on new significance and immediacy in the light of continued corporate accounting and management scandals. The questions apply not just to the corporate behemoths, but to all managers, at all levels, no matter the size of the organization.

Although you wouldn’t think so to listen to the top executives at Enron, etc., historically, the “head” person has been acknowledged as being responsible for the actions of her staff—but does this refer only to the CEO/Chairman/owner/President/Queen/Bishop/etc.?

Not really. What it does mean is that anybody in a management position, whether of people or function (departments may have a manager, but no staff, based on company size), is responsible for their domain. In other words, the accountability rests/buck stops with the top person of any given group, from team to entire corporation/government/entity.

You can rise to that responsibility by doing the following:

1. Know your own job in detail.
2. Know your own strengths and weaknesses, as well as those of your direct reports.
3. Know what your group/function is charged with accomplishing.
4. Understand your boss’s strengths, weaknesses, and responsibilities.
5. Don’t kid/prevaricate/lie to your boss—or to yourself.
6. Always remember that if you manage anybody or anything, you are the accountable/responsible party. Period.

In short, take ownership of your area. That means to take credit for what works and responsibility for what doesn’t, and encourage others to do the same. Companies filled with “owners” quickly become winners.

January 8th I wrote a post called Leaders who DON’T: politicians. It must have struck a chord because it kicked off some great discussion. Here’s a sample, I started by saying

We have no leaders, let alone statesmen, just ideologues, elected by like-minded ideologues, who care only about getting reelected, bringing government money back to their constituency and making lucrative connections in the event they aren’t reelected or are caught by term limits.

Albert Einstein said, “The significant problems we face cannot be solved at the same level of thinking we were at when we created them.”

Eric Eggertson Too true. It seems politicians have lost the knack for making the right decision, even if it’s not popular.

Ron@TheWisdomJournal I heard one time that politicians think only about the next election, but statesmen think about the next generation. I’m pretty sure all the statesmen are gone….

Bob Turek This whole “drive to power” attitude has yielded politicians who are always using their current position as a stepping stone to the next…The use of position to overwhelm others while competing for the next position leaves little room for doing the right things.

Ivan Rios We are way below the level of thinking that created the problem.

Ren Garcia There is the Christian concept of a Servant-Leader. The name says it all: a person who appreciates the needs of the people he leads and follows them…We actually have a living Servant-Leader here in the Philippines…A parish priest saw that the needs of people of his province were not being met. He and his parishioners got together and captured the governorship against all the guns, goons and gold of the traditional politicians (tra-pos, in the local vernacular, a slang word for “dirty rags”).

Mat …One sad reality is that the American public has a memory that spans three news cycles. We keep closer track of the story arc Grey’s Anatomy and the New England Patriots, or when the next iPod will be released. And with no community and institutional memory, there may be no accountability. So in my humble opinion, that’s the biggest problem.

There’s lots more. Intelligent people, civilized discussion, no rhetoric.

I hope you’ll find the time to join us and add to the conversation.

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I really thought that Steve Mann over at AbleBrains was cool guy. Heck, he even talks on the phone! So what does he do after we talk? Tags me to produce an eight things you wish you didn’t know about me post, also known (I think) as a meme. Steve’s still a cool guy, but don’t kid yourself, I’m plotting my revenge.

Steve and I have the first two in common.

1. The only major surgery I’ve had is also an appendectomy, also at 2 AM, also by the on-call surgeon only I was at home in San Francisco. Having never been sick I didn’t have my own doctor so I chose a hospital a friend had been in. I was back in my room before the anesthesiologist came to recovery to check on me, checked myself out about five hours later, went home and vacuumed my apartment—it needed it!
2. I also love to cook and am very good at it. Unfortunately, I also love to eat, so since I’m single I’ve given up cooking except on rare occasions.
3. I have the singing voice of sea lion on a bad day, but I always call my friends to serenade them on their birthdays. They claim that they don’t put the receiver down, but I don’t believe them

Now I’m going to cheat. You can find seven more here.

And if I tag anyone else I’ll get killed, so this round stops here.

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OK, I admit it, I enjoy it when a pundit sticks his foot in his mouth and ends up with egg on his face—even if I have to wait a whole year for it to happen. It helps me put my own goofs in perspective. Here, courtesy of Business Week, are my favorites ordered my way, but including their BW rankings.

12 “But [it] is very likely that oil prices will range in the medium term around an average of $40…. In the long run it could even be $25 to $30.”

LORD BROWNE, CEO, BP, June 12, 2006. Oil prices averaged $70-plus a barrel in 2007.

5 “We do notexpect significant spillovers from the subprime market to the rest of the economy or to the financial system.”

BEN BERNANKE, Federal Reserve Chairman, May 17, 2007. A global credit crunch began three months later.

3 “The media’s great love affair with the Nintendo Wii is beginning to sour…. There are whispers that the device is tiring and gimmicky.”

TYLER TODD, video-game columnist, The Gazette (Montreal), Oct. 14, 2006. Press reviews stayed positive in 2007, and buyers stood in line for the console for the second year in a row.

4 “AMZN is a stock that continues to live on borrowed time.”

TIM BOYD, Caris & Co. analyst in a report about the stock of Amazon.com on Oct. 26, 2006, when the company’s shares were at 38.50. On Dec. 17, 2007, Amazon shares were trading at 85.09.

9 “The steady improvement in [home] sales will support price appreciation…[despite]…all the wild projections by academics, Wall Street analysts, and others in the media.”

DAVID LEREAH, chief economist, National Association of Realtors, Jan. 10, 2007. Housing prices steadily worsened, falling even farther than many skeptics had predicted.

Now look at what you predicted that didn’t come true. Isn’t it great? There’s no way any of us got our feet further into our mouths than these guys.

What’s your favorite foot-in-mouth experience?

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Not sure who to vote for? Wondering who to promote? Trying to evaluate the best candidate for CEO? It’s easy to choose, just vote/promote/hire the best jaw line.

A strong chin, that Hollywood staple, may also be a plus for aspiring CEOs. That’s the conclusion of New York plastic surgeon Darrick Antell, who presented his highly anecdotal evidence at the recent 2007 World Congress on Liposuction Surgery and Advances in Cosmetic Surgery in Dubai. Antell drew a line from the nose tip to the chin on photos of 42 CEOs from 2005’s top 50 Fortune 500 companies. Some 90% (including Carly Fiorina, then Hewlett-Packard’s CEO) showed nonreceding-to-prominent chins, vs. 40% of the U.S. population. People equate such jawlines with confidence and character, says Antell, who performed 20 chin augmentations in 2007. (Topping out at $7,500, the surgery’s a bargain compared with, say, a $92,000 MBA from Harvard.) Some dynamos have “deficient” chins, Antell admits. But most are entrepreneurs. When it’s time to pick a top manager, the one with the Superman jaw gets the job.

So now you know how to make that all important voting/promoting/hiring decision. And, for those not yet at those lofty levels the choice is clearer still—start a company or get a chin augmentation.

Whose chin would you vote for or like to hire?

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It’s funny how things happen. Yesterday I wrote abut the talent crisis and referred you to a new report by McKinsey. I also received a link from a client, Emanio CEO KG Charles-Harris, to a fascinating article on Craig Venter’s vision of and breakthrough work on built-to-order bacteria using only man-made DNA.You’d think that the growth in synthetic biology and other life sciences, combined with the talent shortage, would be driving a need for experienced scientists. But that assumption is much too logical for the real world.

I also found a link via a Google alert to a discussion board at Biofind with comments regarding the plight of experienced (read: over 40) scientists who actually do science.

‘Another reason the older scientists have a hard time in the job market is that hiring managers worry about how they’ll fit in the corporate culture. At 55, I interviewed last year at a tiny but profitable company in northern San Diego. The 2 owners were barely 40 and everyone in the lab appeared in their mid 20’s.’

‘I wish I had a nickel for every time a younger scientist seriously asked me how many micrograms in a milligram (or worse – which is bigger). Even my PhD boss at my last company asked me that!’

‘The only reason younger people get hired these days is because the hiring Company can pay them less, not because they are more cutting edge or can get work done faster…Even worse, they’re a drag on MY productivity because I have to baby sit them for six months until there even capable of doing a single experiment unsupervised.’

Unfortunately, this isn’t limited to biotech, you find similar comments and stories in every field.

Stupid is as stupid does and the executives running these companies are definitely stupid.

What stupidity have you run into lately?

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Continuing from yesterday with comments on Russia’s Vladimir Putin Person of the Year through the eyes of a thirty-something Russian entrepreneur Nick Mikhailovsky, CEO of NTR Lab.

Most of Putin’s support by the nation comes from the growth of ordinary people’s living standards. The largest part of this economic equation—growth of oil prices—cannot be reasonably attributed to Putin’s effort, although people do associate their financial improvements with Putin. Also, to his merit is the fact that oil money has not run into other countries.

Actually, the stability and investment climate in the last four years has been extremely good and resulted in a large flow of capital into Russia. On the other hand, Putin’s administration has not been efficient in performing any complex economic reforms. Pension reform has actually failed, as did the program to provide people with reasonably prices real estate—while homes are built in record volume the prices have skyrocketed, especially in Moscow. Attempts to fight high inflation rates have also failed so far.

Yet another factor in the improvement of people’s living standards is the decline of street crime and the move of organized crime into legal business (the way it did in the US in the 1930s), but I am not sure that Putin has anything to do with that.

There are many less important things to discuss, but this is already way too long, so I will try to summarize:

Putin has been true to the national interests when and how he understood them, and reasonably efficient in achieving related goals. He has been lucky that oil prices have grown during his rule and has used this luck well enough. Russia has become more predictable during his rule and the business climate has significantly improved, which resulted in significant growth of direct foreign investment in the last four years.

You can reach Nick at nickm@ntrlab.ru.

What do you think? Does Nick’s view of Putin match up with what you’ve read about him?

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McKinsey’s report Making talent a strategic priority (requires free registration), the follow up to their 1997 study, War for Talent, is a must-read not just for CEOs of all size companies, but for every executive and manager—no matter their field or level. According to a McKinsey [executive] Quarterly global survey in 2006, “…respondents regarded finding talented people as likely to be the single most important managerial preoccupation for the rest of this decade.’

Another done in November 2007, ‘revealed that nearly half of the respondents expect intensifying competition for talent—and the increasingly global nature of that competition—to have a major effect on their companies over the next five years. No other global trend was considered nearly as significant.’

The study goes on to say, ‘Too many organizations still dismiss talent management as a short-term, tactical problem rather than an integral part of a long-term business strategy, requiring the attention of top-level management and substantial resources. “Everyone spends time on today’s business—we attribute very little value to doing anything else,” one European COO lamented recently. “Talent management puts you under strain because it stops you from doing what you are rewarded for.”

I’ve heard the same refrain for years and had the same reaction. But if you don’t consider taking care of your people your primary job then why you did you become a manager in the first place?

The solution to this is almost a no-brainer—tie a noticeable percentage of bonus compensation to carefully quantified, achievable talent management goals, such as improving retention and employee development.

McKinsey continues, “In our work, senior executives have frequently acknowledged their failure (and that of their line managers) to pay enough attention to these issues. Our research at scores of global corporations has highlighted the obstacles that executives face, including short-term mind-sets, minimal collaboration and talent sharing among business units, ineffective line management, and confusion about the role of HR professionals”

As with most things, successful talent management is a function of your MAP (mindset, attitude, philosophy™), which only you can really know—let alone change.

Read the article, objectively evaluate yourself and your organization (company, team or in-between) and then MAP out a plan for the future—but do it now.

What are you doing to attract and retain talent in your company?

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When time magazine named Russia’s Vladimir Putin Person of the Year my esteemed b5 editor thought it would make a good leadership post. I didn’t disagree, I just didn’t believe that I had the in depth knowledge to discuss it. But I had something better—my Russian business partner, Nick Mikhailovsky, CEO of NTR Lab. Nick and I have enjoyed a multifaceted business relationship for nearly ten years and during that time have become good friends, so I dropped him a line. You can, too, if you’d like to meet him—nickm@ntrlab.ru.

So here is Vladimir Putin through the eyes of a thirty-something Russian entrepreneur.

What is Putin like as a leader from the viewpoint of a Russian entrepreneur? It is not easy to answer this question, but I will try to.

First of all, let’s look at the global economic, and as a consequence, political context.

The 90’s gave the entire world the impression that the new economy was coming. The Western world viewed the new economy as the “knowledge economy,” developing, overpopulated economies like India and China—as globalization and post-socialist countries as a transition to the free market.

These hopes have mostly come true, except for the knowledge economy, which in large part gave us the dotcom bubble.

In Putin’s time – the first half of the 2000’s – the western world faced the fact that the economy is once again resource-limited (most of the rest of the world never forgot about that, because simple resources like food are a considerable part of an ordinary person’s budget). Being limited, natural resources have significantly grown in price, the most recent spurt being food, with metals and oil growing in price earlier in the decade.

Most large businesses have realized the challenges posed by these prices quickly enough (and those who didn’t, such as the US automotive industry, have significant problems now). This fact led to the understanding that controlling natural resources, especially energy, is critical in the new situation. Where this control cannot be accomplished by the power of money, it should be done by political power, was the further natural understanding. The latter understanding was especially easy in the USRussia, both Putin and Bush being close to the oil lobby (not that there are many significantly different industrial lobbies over here in Russia). and

In my opinion, Putin has done reasonably well working on the most critical problem of his time in power in Russia’s national interests. He has effectively nationalized the least nationally oriented oil company in Russia, Yukos. Contracts on Sakhalin signed during Yeltsin’s rule have been reconsidered in a national direction. He stopped Chechen war that was destabilizing the region critical for Caspian oil transit through Caucasus.

Putin has, so far, also been reasonably efficient preventing US invasion in Iran. On the other hand, Putin failed to prevent the US invasion in Iraq and this is probably his largest failure in the fight for oil control. On the other hand, it is not quite clear if such an invasion would have benefited Russia or not—Iraqi experience shows that the oil control takes quite some time, if it’s at all achievable, and any invasion into a significantly oil-producing country results in another surge of oil prices.

Another area in which Putin seems to have significant achievement is the fight with terrorism. Terrorism is a child of mass media, and actually a purely informational phenomenon. You might not know it, but there was no terrorism in Soviet Union, because there was no free press. And if an act of terror did happen, almost nobody would ever know about it. Efficient collaboration with the US, which experienced 9/11 early in Putin’s time, and alignment of the national media have reduced the problem, although the root causes—the absence of national ideology comparable in power to the Islamic one and exceptionally low income in Caucasus region—still remain unsolved.

(Continued tomorrow)

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