We’ve been asked by many of our customers for periodic, no-nonsense emails with just-in-time information for managers and knowledge workers on how organizations work. This is our 36th issue and we hope you enjoy it. Past editions are available on our website.
If you are like me, you are confused about what happened in 2008 and why your 401(k) is now a 201(k). These two books explain a lot about how the financial markets work and why Bear Stearns and Lehman Brothers failed. They are both well written and even though I did have a tough time keeping clear about the difference between a CDO and CDS's, I finally understood how it could be fun to be a trader. I mean, who else can get paid to gamble? While trading is a form of gambling, it is not just a game of chance. You can load your odds by doing the underlying research. However, that also requires someone who can connect the dots as to what it means.
The underlying question of "how do business organizations serve society" is one I kept asking myself throughout. But, who am I to say that making money by betting a company will not pay their bills or their stock will drop is not the best use of these brilliant minds. And they are brilliant; the best and the brightest in our society have been recruited to Wall Street. And what do we as a society have to show for their efforts?
But that is for others to ponder. I found it fascinating that the concept of the organization's culture was brought up repeatedly in both books and ultimately the reason both failed. Organizational culture is the softest of the soft concepts and rarely gets respect in business schools. I can still hear one MBA student telling another that his Organizational Behavior class was a waste of his time that semester. I wonder if he would now realize as the authors did, that it makes the difference between the successful organization and the one that goes under.
Following the lessons I talked about last month from Garr Reynolds', "What is my absolutely central point?"
Organization culture is driven by leaders. Leadership is successful only when leaders are open to new information, new configurations of information and the willingness to apply that to decisions and actions.
Let me play Wall Street trader for a moment and connect the dots of my research to determine where to place a bet. If arrogance, hubris and screamers are at the top of an organization, it will ultimately fail. If you want to invest, find out how the leaders of the organization behave.
Is it admirable behavior that demonstrates the 3 human universal needs (everyone is unique, essential and exceptional)?
Do they demonstrate humility, openness to learning, and a willingness to admit a mistake and do something different?
It's that simple. If the leaders do not behave this way, don't buy the stock. Sooner or later, that inept leadership will destroy the business. And if anyone has an exception, I'd love to hear it...
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