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Leadership Lessons From the Gulf – Part I.

June 22, 2010

Off-shore drilling rigsA colleague, Ira Wolfe, asked a great question over on one of the many leadership blogs we frequent. His question was, “The BP Gulf of Mexico Crisis is just gushing with leadership lessons. What do you think are the most important lessons leaders can learn from this?” I like this question and had been thinking about this very thing for weeks now. There were several responses, and I too contributed since I’d been pondering this topic anyway.

Some of the responses to this post I found to be lacking in real thought or insight. Not unusual, really, because we all work on auto pilot from time-to-time. The “quick” answers came from those who work based on firm ideologies. From it’s all Obama’s fault because he’s a “marxist from a dysfunctional family background with zero executive experience” and “I think government is just adding fuel to the fire!” to “BP shouldn’t have caused this mess by pressuring managers to rush the work.” I happen to fall more in the camp of wanting to not place blame right now. I’d rather focus on solving the problem and then think about the specific failures – so we can avoid them in the future. Meanwhile, it’s instructive to view the action with an eye to how leadership is being executed and our responses as leaders in our own right.

Transparency:

Companies and Governments have yet to recognize that their actions, policies and decisions will be transparent whether or not they want them to be. We all need to assume that we will be subject to disclosure and perhaps Monday morning quarterbacks. Are any of us really ready for this? Insightful leaders will change the culture of their companies so that they are as transparent as they can safely be – with stakeholders at all levels. You can assume that everything you do and say will be posted on the web for everyone to see. And some things that aren’t accurate or taken out of context will also be published. Have you built trust with your customers, employees, suppliers and owners? Who will they tend to believe? You or the “whistle-blower?” It’s too late to build trust once the fecal matter has come in contact with the rotating blade.

Ethics:

Ethics is a business process. As leaders we all need to make sure that the culture we build is not one of focus solely on the measurements (that is financial results), but rather focused on the value for STAKEHOLDERS, not just stockholders or owner’s equity for private firms. What are we really here to do? What is our reason for existing? I’m sure it’s not just for profits. Are we brave enough to tell Wall Street that we have no intention of giving them financial forecasts and that we are focused on providing valuable products and/or services? That we’re in this for the long haul and quarterly results are not really significant? To me, that would be real leadership.

Accountability:

I see positive lessons here. BP’s CEO, Anthony Hayward has stepped up and taken responsibility. To be sure when it comes to PR, he’s a loose cannon on the deck. Those of us focused on corporate governance would say Hayward’s taking responsibility now is too little too late. None-the-less, Hayward and the COB Carl Svanberg have said that they and BP accept responsibility and accountability for this disaster. They will lose their jobs when this stabilizes, and they know that is coming – the “ultimate” accountability.

I see the President also accepting that he is accountable for making sure every thing that can be done to mitigate this disaster is in fact done. Yet there is little that he can do about what is happening one mile below the surface of the Gulf ocean. What he can do (and perhaps is not doing well) is make sure we clean things up before the oil hits the shores. As a potential Monday morning quarterback, I’m wondering why we don’t have “tons of people” out there cleaning up the oil as best we can before it comes ashore in wetlands. I get that hitting a beach may be acceptable since it’s easier to clean. But come on now, when it gets into “the weeds,” it’s a real problem. And how about the wildlife? Shouldn’t we focus on getting this up sooner rather than later for all lives concerned?

Where I see a big lack of responsibility and accountability is with us, the consumer. We demand inexpensive gas and refuse to alter our lifestyle so that we minimize our dependence on oil. So we have to come to the realization that we are creating this market, the response to the market is to increase supply and the pressure is then put on our elected officials to allow expedited drilling. We cannot blame others for this dynamic, we must accept accountability too.

Making better decisions:

I am not one of those calling for the President to be more passionate – we have enough of that in business and in government. Instead, I appreciate the calm thoughtful approach that seems to be this particular President’s usual method of operating. Turning to academia as well as the leaders of industry to determine what the best possible approach might be seems to be very logical. That takes time and the average citizen is not patient; they are used to solutions being found in less than an hour with time out for commercials.

One of the respondents to the original question stated that “there are at least 20 people in my own company who could do a better job than Obama . . .” His premise is they could do so because they “actually have experience supervising and running something.” Really? I do not know this gentleman and do not know how large his corporation is. I do know that running the U.S. Government simply cannot be compared to running a for profit company – of any size. I cannot imagine having to deal with all the various factions, bureaucracy, constituents and special interests. How do you really inspire, lead and manage an organization comprising 3.7 million square miles, 312 million individuals and 50 states all with their own view on how things should be done? Here’s what I know: If you’re used to running a business, being able to make the decision on how things will be and then DIRECTING people to “get it done,” you will very likely fail at public service no matter how smart you are – UNLESS, you learn to compromise and accept that you do not have the only right answer, you simply have one right answer and others possess a right answer as well. Every business person I know when challenged on his/her statement that it takes a business person to run the government misses that what s/he would wind up doing is turning our democracy into a dictatorship. Perhaps benevolent from his/her point of view, but a dictatorship none-the-less. No thank you, as bad and deplorable as our system is, it’s proven to be the best so far.

I doubt that anyone who has pat and simplistic answers to this challenge have a clue as to how complex and difficult this disaster really is. I’m quite skeptical that anyone who truly believes that any number of people who have run a business or department of a large business can step in and run the United States Government from the Oval Office has a clue how our government actually works (or doesn’t work). This Gulf Oil Spill is an unprecedented challenge. We are learning as we go. There is a plethora of leadership lessons here – both positive and negative examples to be sure.

To me, the fundamental leadership lesson to be learned here is that we cannot wait to make sure our organizations are not only doing the right things, but making sure we are doing them right. We have to inculcate an organizational culture of accountability and responsibility to deliver value in a sustainable business model that does not focus on profits or growth alone. What is the real purpose for your organization to exist? I’ll give you a hint. It’s not profits. Profits are necessary but not sufficient to build a great and enduring organization.

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