Years ago I watched a 40 story office tower being built in San Francisco’s Financial District across the street from where I worked. I learned that when building in earthquake country enormous pilings are pounded down into the fill and the building goes on top of them. It’s all about flexibility; the pilings act like giant springs so the tower can sway during an earthquake instead of cracking because it’s rigid.
And I’m here to tell you that sway they do; I know having several years in an office on the 35th floor of 50 California Street (and in the bar on the floor above).
Your culture needs the same flexibility if it’s going to survive the quakes and storms implicit in the business world.
A few weeks ago I offered a list of what I call IBBs that provide structural support to culture and the stressed the importance of not allowing them to morph into bureaucracy.
Bureaucracy shouldn’t be confused with process.
Process is good—it helps get things done smoothly and efficiently;
bureaucracy is bad—it’s process calcified, convoluted, politically corrupted, or just plain unnecessary and it feeds on people’s fear of change.
Of the three categories of IBBs, philosophy, attitude/style and policy, the first shouldn’t change at all; the second may morph to take advantage of new technology or show different styles; the third, policy, is the most likely to cause problems.
Here are five actions you can implement to avoid those problems.
Watch out for dozens of variations of “because we’ve always done it that way…” attitude in you and in others—some are very convincing, so pay attention.
Review and revamp your IBBs regularly.
Encourage input and take suggestions from all levels of the company and act on them.
Understand, and make sure that your people understand, things will change based on company growth, the economy, etc., but that the really important stuff, such as fairness, open communications, etc., will be preserved.
Communicate any/all changes to everyone.
Culture is a living entity and IBBs are its limbs and organs. Every living organism requires TLC and feeding—culture is no different.
“Employees Are Our Most Important Asset” It’s almost ubiquitous in corporate culture statements, but what does it really mean?
Financially, employees simply don’t show up on the balance sheet. On the income statement, employees are definitely an expense, often well over 50% for most service-oriented companies. So, in any accounting or financial sense, employees are simply not treated as assets.
Next, asset ownership. Companies own assets .They can buy assets, sell assets, and borrow against assets. Pretty difficult to do that with employees.
Finally, assets tend to have long lives. Real estate has a long life, patents last 17 years (or more); even inventory has a shelf life up to a year.
But companies treat employees just the opposite. Companies resist unionization, which creates long-term relationships with employees. Companies prefer “at will” agreements, which allow the company to terminate employee relationships with only two weeks notice. Is that long-term thinking?
Bluntly, most American companies simply do not treat employees as long-term assets. European companies are even worse. Due to government regulations limiting a company’s ability to terminate employees; most European companies go to extreme lengths to avoid hiring full-time employees.
Rather than working to acquire these human “assets,” they actively avoid them. Sounds like employees are treated more like liabilities than assets.
And in the US the concept of “employee as a liability” has certainly gained currency in the past ten years. Temporary employment, both full-time and part-time, has exploded. Outsourcing, both foreign and domestic, is simply one more way for companies to avoid acquiring employee liabilities.
While employees may be our “most important asset,” companies act as if employees are their greatest liability.
Does your organization claim that employees are its most important asset? How does it demonstrate that? Do your employees believe it? Let us know.
John Thain was lauded as a brilliant leader for years. but he fascinates me as an example of the MAP (mindset, attitude, philosophy™) that is so ingrained and prevalent in a large portion of executives, especially in the financial sector.
Thain became Merrill Lynch’s CEO December 1, 2007. One of his first acts in 2008 was to renovate his office to the tune of $1.2 million. The redecoration included “$87,000 for area rugs, $35,115 for a commode on legs, $25,000 for a pedestal table and $68,000 for a 19th-Century credenza.”
Fired one year later Thain said, “They were a mistake in the light of the world we live in today,” Thain said in a memo to top executives dated yesterday. “I will therefore reimburse the company for all of the costs incurred.”
Search as I might I can’t think of any past world or circumstances that would make those purchases using corporate money acceptable. Ignored, but not acceptable.
Another example of Wall Street MAP comes from the wife of a securities executive who explained how an after dinner game called “credit card lottery” worked, “Each man would take a credit card out of his wallet and toss it onto the table. Then someone — usually their server — would be asked to pick a card and bellow the owner’s name so everyone in the restaurant could hear. The “winner” would pay the bill, which often tallied $1,000 or more.”
There are many more examples, but can’t you hear the echoes from the playground of “My dad can whoop your dad” and as they got older the locker room “Mine’s bigger than yours.”
The problem is they never stopped.
Lay and Skilling; Bernard Ebbers; Dennis Kowalski; Richard Fuld; Bernard Maydoff; to name only a few.
One or two could be put down to insecurity, but this is more like an epidemic of arrested development.
But it’s Thain’s words “in the light of the world we live in today” that are truly appalling.
They seem to mean that nothing has changed. The excess was OK before the meltdown and will be OK again when the economy is back on its feet.
This is just a minor setback—we are still entitled.
You remember the old joke about the farmer using a 2×4 to get the donkey’s attention. It looks as if the economy is the current 2×4 that is getting the attention of shareholders on golden coffins.
Golden coffins are exactly like golden parachutes, only instead of walking out the door you have to die in office to collect them.
I mentioned them last summer, but now change is in the air according to a notice in Risk Metrics.
“In the first vote of its kind, a shareholder proposal seeking a vote on executive death benefits received 42 percent support at Johnson Controls, according to preliminary results released by the proponent, the labor-affiliated Amalgamated Bank.
Scott Zdrazil, a vice president with Amalgamated, said the vote is a “strong sign of shareholder concern.” The bank’s LongView funds, the AFL-CIO, and other labor investors have filed similar proposals targeting “golden coffin” arrangements at 13 other firms, including Shaw Group, which holds its annual meeting on Jan. 28.”
While amusing, it’s not surprising that it’s “labor investors” who are pushing for change.
The only people I can see agreeing with the practice are those who are, or believe they one day will be, a recipient of such largesse.
Is Shakespeare still in fashion? I find his insights and commentary just as apropos today as when I first fell in love with his writing, wit and style back in high school.
No matter the subject, you can always find an elegant comment on it from the maestro.
“Neither a borrower nor a lender be,
For loan oft loses both itself and friend,
And borrowing dulls the edge of husbandry.” –Polonius, Hamlet (Back then the gentry were selling their estates bit by bit to maintain an ostentatious lifestyle in London. These days the gentry sell off our estates to support an ostentatious lifestyle globally. As is said, the more things change, the more they stay the same.)
“‘Tis better to be vile than vile esteemed,
When not to be receives reproach of being,
And the just pleasure lost, which is so deemed
Not by our feeling, but by others’ seeing.
For why should others’ false adulterate eyes
Give salutation to my sportive blood?” –Sonnet 121 (In Wall Street speak there’s not a lot of difference between sex and money when you get right down to it.)
“Lord, what fools these mortals be” –Puck, Mid-summer’s Night’s Dream (This says it all—somewhere the gods are laughing.)
Today is Valentine’s Day, but I think you’ll get enough of the love angle elsewhere. Anyway, I’m not really into that stuff, but I do like the oddball aspects of business.
Go directly to jail, do not pass Go, do not collect $200. Yet another white collar crook caught with his alleged pants down; it’s old news these days. But here’s one with a twist. Involved in a $100 million mortgage fraud, Christopher J. Warren was picked up with $70,000 stuffed in his shoes, along with a few other goodies worth over a million dollars. We can only hope that it happens to more of them.
How ’bout a recommendation that strange is good when it comes to employees? Seriously. Daniel M. Cable, management professor at UNC’s Kenan-Flagler Business School recently published Change to Strange
in which he makes the case that employers who move out of their comfort zone when hiring and move beyond typical corporate policy have a stronger competitive edge.
And here’s my favorite. Managers’ idiosyncrasies when hiring are legion, but it’s their idiotsyncrasies that furnish the most amusement, not to mention frustration, to anyone involved in the process. But what happens when one of those idiotsyncrasies, that blood type determines personality, is an accepted part of the country’s culture?
One item today, because it has several parts, all revolving around a new, way outside-the-box book.
I’m referring to Jeff Jarvis’ just-released What Would Google Do?, exploring how to apply the lessons of Google to other industries and companies.
Jarvis teaches at the City University of New York Graduate School of Journalism; his blog is BuzzMachine.
Business Week published an excerpt describing how a car company run by Google might function and why the auto industry would be resistant to the approach. Be sure to read through the comments, they’re as interesting as the article.
I like the Management Tip Sheet; here are the headings, but the real value is in the details, so be sure to click the link.
Manage Abundance, Not Scarcity
Make Mistakes Well
Give Up Control
Get Out Of The Way
Low Prices Are Good (Free Is Better)
Don’t Be Evil (Contrary to popular opinion the phrase has an internal focus, not external.)
Finally, here’s a video of Jarvis talking about his ideas; there are several other interviews that offer different slants and information.
Just to be clear, this isn’t a book recommendation. I think there are good lessons to learn from Google, but there are good lessons to learn from most truly innovative companies.
I know of none that can be applied straight across the board or are one-size-fits-all.
But all the companies that still believe “if we make it they will buy” are in for a very rude awakening when the economy turns around—as it will.
Entrepreneurs face difficulties that are hard for most people to imagine, let alone understand. You can find anonymous help and connections that do understand at 7 cups of tea.
Crises never end.
$10 really does make a difference and you’ll never miss it,
Years ago I watched a 40 story office tower being built in San Francisco’s Financial District across the street from where I worked. I learned that when building in earthquake country enormous pilings are pounded down into the fill and the building goes on top of them. It’s all about flexibility; the pilings act like giant springs so the tower can sway during an earthquake instead of cracking because it’s rigid.
“Employees Are Our Most Important Asset” It’s almost ubiquitous in corporate culture statements, but what does it really mean?
John Thain was lauded as a brilliant leader for years. but he fascinates me as an example of the 
You remember the old joke about the farmer using a 2×4 to get the donkey’s attention. It looks as if the economy is the current 2×4 that is getting the attention of shareholders on golden coffins.
Is Shakespeare still in fashion? I find his insights and commentary just as apropos today as when I first fell in love with his writing, wit and style back in high school.
Today is Valentine’s Day, but I think you’ll get enough of the love angle elsewhere. Anyway, I’m not really into that stuff, but I do like the oddball aspects of business.
One item today, because it has several parts, all revolving around a new, way outside-the-box book.
