Showing posts with label management. Show all posts
Showing posts with label management. Show all posts

Wednesday, April 6, 2011

Referring to the speculation in gold that was engineered by Jay Gould and others in 1869 to enrich themselves and the Erie Railroad, Henry Adams (1838-1918), a grandson of John Quincy Adams and great grandson of John Adams, wrote at the time:

“For the first time since the creation of these enormous corporate bodies, one of them has shown its power for mischief, and has proved itself able to override and trample on law, custom, decency, and every restraint known to society, without scruple, and as yet without check. The belief is common in America that the day is at hand when corporations far greater than the Erie [Railroad] — swaying power such as has never in the world’s history been trusted in the hands of mere private citizens  . . . — will ultimately succeed in directing government itself. Under the American form of society, there is now no authority capable of effective resistance.” (1)

Gould had wanted the price of gold to rise not only because he had bought some to sell at a higher price, but also because as a stockholder of the Erie, he would benefit from the railroad transporting more wheat from the Midwest to the east coast for export. A higher price in gold meant a lower dollar. Wheat being based in dollars, a lower dollar meant more exports. The strategy was essentially to devalue the dollar, which Gould assured President Grant would be in the national interest economically. As the price of gold rose to $165 in 1869, Grant, fearing a bubble, pulled the plug by having the Treasury sell $4million in gold.  The collapse in the gold market triggered a drop in the stock-market. Even if it might have been in the short term interest of the speculators and railroads, the manufactured bubble was not in the national interest after all. Gould’s bribes of administration officials had been in vain.

Henry Adams saw the imprint of corporate power eviscerating both societal norms and democracy in the scandal.  In other words, the new-found corporate power eventuated in the birth of the need for corporate social responsibility amid capitalism eclipsing democracy. In academic terms, corporate social responsibility and (corporate) business & government, although discrete fields, were both first publicly recognized in 1869.

The corporate power occasioning Adam’s recognition was a novelty at the time, according to Brands, because the large corporation had only come into being as the railroads incorporated in the 1850s. Looking back after the Civil War, Henry Adams observed, "The last ten years had given to the great mechanical energies — coal, iron, steam — a distinct superiority in power over the old industrial elements -- agriculture, handwork, and learning." (2)  The power of steam in particular translated into large, publicly-held, corporations first in the railroad industry.

On account of their size and scope, and the associated equity capital requirements given the risk faced by lenders, the railroads were the first large American corporations to be publicly traded. The diffusion of ownership — a consequence of the large capital demands — led to a separation of ownership from control and to a new ownership interest: that of the short-term-oriented speculator. A short-seller, for example, seeks lower corporate earnings in the future, while a long-term investor hopes for higher dividends, and thus profits. Managers can exploit this difference in order to pursue their interests in the name of the corporation at the expense of societal norms and democratic governance.

Undergirding the managerial basis in skill, the railroads were the first companies to develop the methods of corporate administration. For example, there were supervisors over supervisors—in other words, multilayered organizational charts. Furthermore, dovetailing with the need for safety and efficiency (given the competition), the railroads developed precise management of their operations, including the development of standards for measuring performance. In short, the railroads were the first to develop a cadre of managers specialized in administration in the particular industry. (3)

Regarding the private power based on technique (i.e., managerial power), Henry Adams announced in 1869 that there was no authority, whether in society or government, capable of resisting it. The normative call for corporate social responsibility and the political call for a resurgence of democracy amid the encroaching capitalism were born. In other words, with great power came a recognition of a need for great responsibility. The corporate social responsibility movement began as precisely this recognition even as the modern large corporation was in its second decade.

Punctum Saliens, the large corporate type of commercial organization itself is inherently powerful relative to societal norms and even potential governmental or regulatory restraints. That is to say, the invention of the large corporation may have been inherently problematic, essentially involving systemic risk to the republic itself on account of the private power of the managements. To paraphrase Nietzsche, power cannot be but powerful. To unleash an inherently powerful feeding machine and expect it not to eat the grass is naive, if not patently irresponsible. To expect the managements of extremely wealthy corporations to be willingly socially responsible when their economizing and power-aggrandizing nature is to run through such non-constraints is simply ideological, if not fanciful. Fundamentally, the problem with corporate management is its inherent proclivity to bristle at any external constraint. It is the underlying maximizing egoism that is innately antithetical to the limiting natures of government regulation and corporate social responsibility.

Footnotes:

1.      Henry Adams, “The New York Gold Conspiracy,” in Charles F. Adams, Jr. and Henry Adams, Chapters of Erie (Ithaca: Cornell University Press, 1956), pp. 135-36.
2.      Henry Adams, The Education of Henry Adams (1907; Boston: Houghton Mifflin, 1961), p. 238.  
3.      H. W. Brands, American Colossus: The Triumph of Capitalism 1865-1900 (New York: Doubleday, 2010), pp. 22-23.

Monday, March 14, 2011

The New York Times reports that in early 2009 at Google, "statisticians . . . embarked on a plan code-named Project Oxygen. The 'people analytics' teams at the company produced what might be called the Eight Habits of Highly Effective Google Managers. 'My first reaction was, that’s it?' says Laszlo Bock, Google’s vice president . . .  for human resources. 'The starting point was that our best managers have teams that perform better, are retained better, are happier — they do everything better,' Mr. Bock says. 'So the biggest controllable factor that we could see was the quality of the manager, and how they sort of made things happen. The question we then asked was: What if every manager was that good? And then you start saying: Well, what makes them that good? And how do you do it?' He tells the story of one manager whose employees seemed to despise him. He was driving them too hard. They found him bossy, arrogant, political, secretive. They wanted to quit his team. 'He’s brilliant, but he did everything wrong when it came to leading a team,' Mr. Bock recalls. Because of that heavy hand, this manager was denied a promotion he wanted, and was told that his style was the reason. But Google gave him one-on-one coaching — the company has coaches on staff, rather than hiring from the outside. Six months later, team members were grudgingly acknowledging in surveys that the manager had improved." (1)

Analysis:

"What if every manager were good" sounds a lot like "What is everyone were above average?" One might reasonably ask: In what sense good?  Good people as in kind-hearted?  Good as in having mastered managerial skills?  Or good as in having a good style--meaning that it fits the particular corporate culture? The question of what makes a manager good hinges on what is meant by "good." In the case of the bossy and arrogant manager at Google, I contend that what was "bad" was not limited to or sourced in his style; rather, the problem was his personality, which transcends style. Arrogance, for example, is a basic attitude rather than a style. It is no surprise that "coaching" (a mismomer outside of sports even if a fad in business circles) did not turn the guy around. It sounds to me that the guy needed therapy or counseling. That Google would reduce a "bad" personality to leadership style and prescribe "coaching" rather than a therapist is no accident.

It is commonly taught in business schools and believed in business settings that the science of management is applicable for virtually any business in any industry. In fact, one can theoretically manage a "team" (another misnomer from sports--is business really so boring that such faddish terms need to be borrowed and used out of their context?) without having any skill or knowledge particular to the product.  The idea, in short, is that anything can be managed, and that knowledge of the particular thing is not requisite. Hence it is not surprising that managers would overstep onto psychology without having a knowledge of that field. What is actually a psychological problem is thus transmuted into managerial terms such as "style" and "coaching." Personality, in other words, is reduced to the extent to which it fits within leadership and the manager is assessed from the standpoint of leadership style (e.g., task vs. relationship). Moreover, reducing managing to behaviors, as if that which is inside the manager is a black box, is to ignore that which separates the mice from the men as managers in terms of getting along with others (i.e., "good" as interpersonal relations).  In other words, improving a manager's "style" by trying to change (manipulate?) her behavior is apt to be insufficient. It is like paddling a row boat without moving the anchor; the boat isn't going to move very far.
With this in mind, I turn now to critique the "Eight Good Behaviors" that the good people at Google recommend.

  • Be a good coach. Included: provide specific feedback without being too negative and "present" solutions to problems. But isn't this just management?  I don't see much actually transferred from what coaches do in sports.
  • Empower your team and don't micromanage. Freedom vs. advice. Challenge the "team" with "big" problems. Sounds like this was written by a "team" of kindergarden teachers (no offence to the latter). Empower is a faddish politically-correct term that is rarely defined adaquately. With regard to micromanaging, every micromanager I have encountered has had control issues--meaning psychological problems involving or impacting personality and interpersonal conduct (but not rooted in conduct, or style!).
  • Express interest in team members' success and personal well-being. Get to know about their lives outside of work and make new team members feel welcome. Helping new people to feel welcome is laudable; it is perhaps the area where a manager can truly be most human. Success, however, is a vague term implying an ending (e.g., Did you succeed in getting the kids to sleep last night?), whereas business typically is ongoing and thus not like a race or contest.  Another unsuccessful analogy unless used for particular tasks that have a clear end-point.  With regard to getting to know things about subordinates outside of work, this can be viewed as invasive and with a hidden agenda (e.g., to manipulate better "performance"). Also, ethical problems can arise if subordinates feel pressured to discuss matters such as their religion and politics. If a manager, as a human being, is genuinely interested in other people at work, subordinates will likely sense it; otherwise, they could feel manipulated.
  • Don't be a sissy: Be productive and results-oriented.  Focus on the "team" setting achievement goals and priorities.  We are back to kindergarden language (e.g., sissy and be productive!) and to what is essentially management itself (which is inherently geared to producing results). A business is a results-oriented enterprise.  A focus "on what employees want the team to achieve" belies a manager's true intention to set goals for the people working under them.
  • Be a good communicator and listen to the team. Two-way communication. "Hold all-hands meetings and be straightforward" in communicating . . . Encourage open dialogue and listen." All-hands? At any rate, should we really be encouraging managers to have more meetings?  Being straightforward is laudable, however, as is open dialogue. The question is perhaps whether this is even possible where managers view their subordinates as lower. In other words, can there be straightforward dialogue where there is a power relation between boss and employee?
  • Help your employees with career development. Here too, the difficult matter of being able to be straightforward is relevant, given how organizational politics and a manager's own interests can relate to others' career development.
  • Have a clear vision and strategy for the term even in the midst of turmoil. Involve the team in setting the vision.  Here is yet another vague analogy that has been a fad: leadership vision. How does this differ from coming up with a goal? Has anyone in the study of leadership or management successfully defined vision?  The think about faddish words use as weak analogies is that people can use them without knowing what they mean--even as they are using them! Everyone just sorta looks the other way rather than asking: well, what do you mean exactly by vision as distinct from goal-setting? Long-term goal setting?  But is that to have sight or merely to plan further out? Lastly, the use of the word turmoil, particularly when one considers how a turbulent business environment pales in comparison with the protests in the Middle East and the Japanese earthquake in 2011, seems to be excessive. Do managers have a tendency to overstate--or overdramatize--what they face on a daily basis?
  • Have key technical skills so you can help advise the team. Work side by side with your subordinates when needed and understand the work they are doing. This principle, or "habit," challenges the notion that a person can learn management skills and apply them to virtually any business--knowledge of how to make the particular product being unnecessary.  I suspect this is an American view of management. The Japanese have traditionally hired managers from the factory floor precisely because they are familiar with the technical skills being used to make the particular products.  A good manager, I contend, is one who is already proficient with most of the tasks of his or her subordinates and can therefore help out when needed.  So it would appear that Google got one right.
1. Quoted from: http://www.nytimes.com/2011/03/13/business/13hire.html?pagewanted=1&_r=1&ref=todayspaper

Click to add a comment or question (or view posted comments) on leadership or management at Google.

Thursday, March 10, 2011

As I was entering a “Bestbuy” store one summer day wearing shorts and a tee shirt and carrying my ubiquitous book bag (as you might expect), the security person, whom the manager later told me also works at a prison, walked after me as though stalking me, practially yelling “Sir! Sir!” Reaching me as I was talking to a salesperson who was treating me as though I were a customer, the lineback demanded to look in my book bag immediately. I stated matter of factly that I had had no opportunity to stash anything from the store in my bag while walking in the front door (after which he saw my every move).  Nevertheless, I opened my pouch for him and he was satisifed. After I left the salesperson, I reported the incident to a manager, whose “company apologizes” was belied by his curtness and saccarine politieness.

Can a company even apologize? That sounds anthropomorphic to me. Perhaps if an employee is rude in “correctly” following a company policy—such that the policy itself is odious—a manager could apologize for the store. But can a store apologize? That sounds a bit like corporate “spending” being counted as “free speech" and like a company being regarded, moreover, as a legal person. In my view, the legal person status of a company does not mean that “it” can speak and apologize. Perhaps it makes more sense to say that only the person who committed some act can apologize for himself.

In the case of my “Bestbuy” experience, the manager added insult to injury. After I told him about the security person’s behavior—the manager agreeing with me that the employee had been excessively zealous—the manager told me that typically people with book bags are, in his experience, thieves. When I objected to his assumption, he turned dismissive, accusing me even of “going in circles” in spite of the fact that I had not repeated myself at all in my one sentence reply.  The manager seemed utterly unaware (or indifferent) to the fact that he was adding insult to injury, even as he was apologizing for the company! This is a perfect example of the duplicity of corporate-speak.

A company is an economic organization. Hence, for “it” to apologize, there really must be some economic sacrifice involved; otherwise, the apology does not register in terms of what the company is. The vacuousness of “We do apologize for any inconvenience” (which we all have heard) is attested to by how easy it is for a manager to utter it while simultaneously insulting the customer (e.g., “you’re going in circles; can I go now?”). I contend that for a “company’s” apology to be valid, some economic sacrifice must be given up without the company benefitting in any way such as by a future purchase with a coupon. Customers, I contend, should indicate that the apologizing manager must put his or her company's money where its apology is; otherwise, the customer should say in like terms, "unfortunately the apology cannot be accepted as valid.” How, I wonder, would a manager or clerk react to being the recipient rather than the source of policy-speak? He or she would probably reply, “well, I can’t do anything about that.” His "can't" is probably disingenuous, as it is undoubtedly convenient, at least at the moment. The customer might reply, 'unfortunately I can't shop here again." This exchange evinces the sheer rigidity that is so ingrained in corporate-speak as well as the underlying mentality.  I suspect that businesses are so used to their customers accepting the rigidity as given (rather than as contingent or affected) that the managers and employees take their own rigidity as required, as though deterministically rather than by their free will. Essentially, I am arguing that only certain things—money and policies—are recognizeable to the managerial birds of prey, hence their “apologies” must be converted back into such terms by customers or rejected for what they are--mere attempts to pacify customers so they will buy something.  That it never occurs to a manager that the actual employee who had offended the customer ought to be the person to apologize suggests some strange surrogate type of apology is therefore valid. Just like if I offend someone only I can apologize for what I have said or done, so too only the offending employee can proffer a viable and thus acceptable apology.  For a customer to accept anything less is to enable weakness and subterfuge.

Monday, March 7, 2011

U.S. Sen. Rand Paul (R-KY), was the Tea Party candidate who challenged the Republican establishment to win the party’s Senate nomination in Kentucky on May 18, 2010. A day later, he publically criticized a plank of the Civil Rights Act of 1964. Specifically, he said in an interview with Rachel Maddow on MSNBC television that he supported the sections of the Civil Rights Act that applied to public accommodations but had concerns when it came to its applicability to private business. He had raised similar concerns earlier in the day about the Americans with Disabilities Act in an interview on National Public Radio. Asked by Maddow if a private business had the right to refuse to serve black people, Mr. Paul replied, “Yes.”

In citing the rights inherent in private property, Mr. Paul, an eye surgeon, was refusing to recognize the “publicness” in a business being open to the public, as distinct from someone’s house, which is not open to the public. In other words, Mr. Paul was ignoring the qualification to private property that comes into play as soon as said property is opened to the public.  Such property is quasi-public precisely because it is open to the public.  Hence, society, through its government, has a right to dictate the obligations going with that element of publicness.  Mr. Paul would have been on firmer ground had he limited his statement to private clubs, such as country clubs, which do not receive public money and are not open to the public.  However, even here, if people associate in a way that hurts others by intentionally excluding them, there might be an argument in favor of subjecting them to the Act, though such an argument seems weaker than those for freedom of association and on private property not open to the public.

Rand Paul also said on ABC TV that President Barack Obama’s criticism of BP in the wake of the Gulf oil debacle sounds “really un-American.”  Paul said that the president’s response is part of the “blame game” that’s played in the United States. The game, he argued, leads to the thinking that tragic incidents are “always someone’s fault” when sometimes accidents just happen. Sen. Paul was ignoring that BP overrode Transocean in directing its employees not to use “mud” to maintain pressure in the well as cement “corks” were being inserted.  Also, managers at BP claimed to have the technology to stop any leak or spill when no such technology existed. In short, the managers at BP put the Gulf at risk in order to cut corners so as to earn more profit (as if $2 billion a month was not sufficient).  Rather than go after the mentality of shirking amid a “more, more, more” mentality wherein nothing is ever enough, Paul went after the representative of the victim–society as a whole.  That is to say, he added insult to injury by going after the victim rather than the culprit.  In so doing, he ignored key elements of the culpability.

Listening to the candidate the Maddow show on MSNBC, I was more concerned by the way he chose to evade questions than by his failure to take “being open to the public” into account in his view on civil rights law. At one point, Rachel Maddow asked him, “yes or no,”  on whether he would exclude private businesses from the Civil Rights law.  He replied that he was against the violence that took place in the 1960s in association with Walgreen’s lunch-counters. Beyond not answering the question, Mr. Paul seemed to be continuing with what he wanted to say–ignoring the question entirely as a mere interruption to be dismissed. I noticed a few times that after Maddow did indeed interrupt him, he simply picked up with what he had been saying.  Could his ignoring the questions be related to his ignoring the “open to the public” qualification and the risky shirking of BP?  In other words, might it be that Mr. Paul simply does not see what is inconvenient to his world view?  If so, I contend that this character trait is far more alarming than even his evasions and his over-simplified view on private property and the oil spill.  If you have ever tried repeatedly to tell someone something only to have your statement ignored as the other person continues on with what he or she was saying, you know what I mean. Sadly, I suspect that Rand Paul didn't notice it. This character flaw is by no means limited to him. Nor is this an invitation for partisan aspersions on the Republican Party.

Rather, I suspect that not answering questions--even asking one's own instead of given any answer to a question outstanding--is a growing attitude in modern America. I have witnessed it myself in emailing people I don't know on matters involving an actual or potential commercial transation. Does the computer come with Office 2007? Reply: When you would like to come by to look at it?  But what about Office 2007?  Or take apartment hunting:  Are utilities included in the rent? Reply: Call me to make an appointment to see the unit. Nietzsche would have a field day with such a mentality that vaunts itself as superior by "virtue" of its own assumed dominance. The basis of Rand Paul's non-answer, in other words, could have been an attempt to dominate beyond his place on Maddow's show. In other words, his non-answers could have been refusals rooted in a will to power that was biting off more than it could chew on someone else's show.

In terms of having a will to power based on strength, many of the stations or offices in modern society that we view as being entitled to dominate are in fact weak.  Nietzsche points to the modern moralist's thou shalt not as an attempt by the weak to dominate beyond their innate weak constitution. He also points to the attempts of the modern manager to dominate in such terms (and the priest as well). In watching various personalities giving non-answers while being interviewed on television, I find myself wondering if they know they are doing it. If they do, they are indeed rascals; if they do not, their stygian pathology is much deeper than I am equipped to investigate. Perhaps the modern illness is malignant narcissism to such an extent in a personality that the delimited perspective eclipses even awareness of what oneself is doing.

Sources: http://www.nytimes.com/2010/05/21/us/politics/21paul.html?ref=politics   http://www.msnbc.msn.com/id/37273085/ns/politics-decision_2010/

Tuesday, March 1, 2011

With much power comes implicit responsibility. Hence, on February 21, 2011, the world recoiled when Gaddafi violently turned on his own people--using his power sans responsibility in a selfish attempt to stay in power. So too, the world had been shocked in April, 2010 when BP's Deepwater Horizon oil rig exploded in the Gulf of Mexico and that the Gulf itself was at risk. That a company could ruin something as big as the Gulf of Mexico came as a surprise to many. That a company, or three in this case, could have minimized such a risk by, for example, sending the U.S. Government contingency plans on Gulf clean up that included rescuing sea animals that actually live in the artic, shocked the public just as much. How could people holding such power treat its use with such carelessness concerning any downside?  The defense of having followed company policy or having excuted business procedures pales in comparison with the societal demand that power, whether public or private, be handled responsibly.  In other words, people take it for granted that power is given to adults rather than to children.  I think we would be surprised how often this has not been the case.  The case of Transocean demonstrates this thesis.

Transocean, which owned the Deep Water Horizon that exploded in April of 2010,  was the subject of a criminal investigation into possible tax fraud in Norway. The company indicated in S.E.C. filings that Norwegian officials could assess it about $840 million in taxes and penalties. The filings also contended that a final ruling against Transocean could have a “material impact” on the company. The company was also the target of tax inquiries in the United States and Brazil. Furthermore, drilling equipment from Transocean was shipped by a forwarder through Iran and until 2009 the company had held a stake in a company that did business in Syria. The State Department claimed at the time that Syria and Iran sponsor terrorism.

In reaction to these charges,  a Transocean statement simply claimed that the managers at the company had always acted appropriately and that they would prevail in any investigations. This is interesting, for “always” is quite an accomplishment.  Once I took a self-inventory and one question was “I always tell the truth.”  Of course, no one always tells the truth, so the question was geared to assessing how truthful one is in taking the test.  Had I answered yes, I would have been lying. The transocean statement, taken by itself, indicates a proclivity to lie, for no human being always acts appropriately. Transocean's statement evinces a certain arrogance, as if to say, "We are above reproach."  Such an attitude is dangerous where there is sufficient power at one's disposal that one's actions can do real damage to the planet.

Transocean, which drilled in some 30 countries and employed more than 18,000 people, owned nearly half of the 50 or so deepwater platforms in the world in 2010. “These people are capable and considered the gold standard of deepwater drilling,” said Peter Vig, managing director at RoundRock Capital Management, an energy hedge fund in Dallas.  I contend that expertise in drilling does not sufficiently counter the kind of charges that were brought against the company. To focus only on expertise in operating machinery or in managing a company as though they were all that matters in business is to hold an extremely narrow perspective on what counts. Furthermore, to let blantantly false asseverations stand (such as of always acting appropriately) is to enable a pattern that can literally destroy a major marine ecosystem.

Source: http://www.nytimes.com/2010/07/08/business/global/08ocean.html?_r=1&hp

See related: http://euandus3.wordpress.com/2010/06/10/bp-dividends-to-stockholders/   http://euandus3.wordpress.com/2010/06/17/tony-hayward-sticking-to-script-safety-is-bps-priority/

Tuesday, February 8, 2011

The New York Times reports that President Obama urged American businesses on February 7, 2011 to “'get in the game' by letting loose trillions of dollars being held in reserves, saying that they can help create a 'virtuous cycle' of more sales, higher demand and greater profits that will put people back to work and turn around the sluggish economy.” Obama continued, “If there is a reason you don’t believe that this is the time to get off the sidelines — to hire and invest — I want to know about it. I want to fix it.” In the speech at the U.S. Chamber of Commerce, Mr. Obama said that companies have a responsibility to help the economy recover. The trouble is that responsibility is a rather vague term that can be variously applied. This is one reason why the corporate social responsibility concept could mean providing society with the products and services that are sought via the marketplace (e.g. Milton Friedman of the Chicago school) while meaning for others increasing corporate philanthropy to alleviate a society problem such as poverty. In other words, responsibility can be made concrete in various ways that can accommodate and indeed reflect the ideologies of those applying the term.

It could be predicted, therefore, that the President's application of responsibility might have differed from some of the business managers in the audience. Indeed, Obama’s suggestion that businesses could help the economy recover by spending their reserves was met, according to The New York Times, “with skepticism by some in the audience.” For example, Harold Jackson, a executive at Buffalo Supply Incorporated (a medical supply company), called the President's suggestion naive. “Any business person has to look at the demand to their company for their product and services, and make hiring decisions,” Jackson said. “I think it’s a little outside the bounds to suggest that if we hire people we don’t need, there will be more demand.” In effect, Jackson was defending Friedman's application of corporate social responsibility from that of the President's.

To President Obama's assumption that American businesses were still sitting on the sidelines, it can be asked, in what sense? The President was pointing to what he viewed as excessive retained earnings. Yet John Schoen of MSNBC reported the same day that the American manufacturing sector was “roaring back” after the recession. Schoen reports a sustained rise in factory orders in five of the last six months, which prompted manufacturers to boost hiring. The Commerce Department had reported a few days before Schoen's report on February 7, 2011 that the manufacturing sector had added 49,000 new jobs in January. Yet this is hardly a roaring comeback in terms of new jobs. Schoen reports that businesses have figured out how to make more widgets with the same number of workers, resulting in higher productivity and profits. Investing reserves in automation, for example, raises productivity by making products faster and better. According to Schoen, “Productivity is a pretty simple concept: It’s a measure of how much stuff a worker makes in a given number of hours. . . . Productivity has also risen as American manufacturers have moved to specialize in more valuable products, sending manufacturing of cheaper goods overseas where wages are lower. As the value of American-made products has risen, so too has the average level of output per worker when measured in dollar terms.” Schoen reports that according to the U.S. Labor Department, the level of output per hour worked rose by 2.6 percent in the last three months of 2010. Even if it is not in the interest of labor, such improvement is in line with the logic of business, given how business is designed and how a competitive marketplace works. Spending retained earnings beyond that which can be expected to raise productivity simply does not make sense to a business practitioner.


In general terms, the (nearly) “jobless recovery” can be seen as pointing to a major difference between the interests of business and society—the latter being represented by the President at the Chamber of Commerce. Given the nature of business enterprise in a competitive market, it is only natural for managers (and boards) to work toward (and reward) greater efficiency (i.e. productivity). Business managers thus understand or apply responsibility in this way. As per Harold Jackson's point, to hire labor beyond the optimal efficiency point in order to solve the wider societal problem of unemployment would run against a firm's telos, or goal. Ultimately, such over-hiring would compromise a company's continued viability (which could result in the loss of even more jobs).

One cannot blame a manager for thinking in line with his or her company's logic, or raison d'etre, any more than one can blame a shark for hunting for food and eating like a shark. A shark is a shark, and a business can also be viewed as a feeding machine. To posit or impose responsibilities onto a machine does not make sense either to the machine or to those who operate it (in their functioning as operators). To an operator, responsibility means operating well—which, by the way, is virtue in the ancient Greek sense. The President's use of responsibility extrinsic to a business calculus simply would not register. It would be like trying to get ought out of is. Even within business functionality, responsibility even as in fiduciary duty to the stockholders is simply translated into “try to get as much profit as possible, now or later.” In other words, ought does not compute in a business technical vocabulary. The term is extrinsic, like societal problems and goals. To come from a societal standpoint and impose “be responsible” to a business practitioner is like shouting at a deaf person. The business person is apt to simply look curiously at the person as if wondering why he is speaking in a foreign language while assuming he is being understood nevertheless. “How odd,” is perhaps the most honest response that one could give to such a display.

The difference between the President's application of responsibility and that of Jackson can also be understood as the difference between the interest of a subunit and the system as a whole. It is only natural for a part of a whole to operate in the interest of the part itself rather than necessarily the whole. The interests of the latter can thus fall through the cracks. Government regulation is an attempt to plug such cracks, but regulations, like firms, are particular. On the issue of unemployment, the societal question is whether even a fully-operational economic system can supply full employment. If not, it may be the government's responsibility to supply the surplus employment, directly or indirectly via subcontracting. Crucially, this supply must be designed such that it does not reduce the employment provided by the private sector. The surplus jobs must be functions that the private sector does not and would not address. The President's error in his speech to the Chamber of Commerce could be that he was assuming this surplus is the responsibilities of “parts” of the system (i.e. individual companies) rather than of the system itself (i.e. the government).

In sum, responsibility is a dubious concept to apply to business; the term is too vague to have much traction in discussing such vital matters as affect our economic livelihoods and the related viability of our economy. It seems to me that the priority ought to be that every able-bodied and minded adult has a job (or, otherwise, a means by which he or she can have sufficient economic wherewithal to survive in this interdependent society), whether through business, non-profits or government. Ideologies, including responsibility itself, ought to be relegated as luxuries with which we can play on the margins once full employment has become a fait accompli. That is to say, ideologies might contribute to improving full employment, rather than being depended on to reach it or allowed to keep us from it. Of course, it could be countered that ideologies are part and parcel of this entire discussion and thus cannot be dissected from it. That may well be. Even so, I submit that ideologies such as laissez faire and corporate social responsibility ought not be allowed to thwart us in how we constitute full employment as a societal fact. That is to say, we ought to direct full employment by whatever means necessary then work from there (once attained) to improve it. Simply put, for some reason, we don't treat full employment as necessary.; rather, we treat it as a goal.  "How odd," an alien from another gaxaxy might say (in its own language, of course), should one visit us and want to study us.
Sources:

Wednesday, February 2, 2011

Despite several days of overwhelming popular grass-roots protest in Egypt, on January 30, 2011, the U.S. Secretary of State, Hillary Clinton, stopped short of urging the Egyptian president, Hosni Mubarak, to resign.  According to The New York Times, she spoke of "a process that must include a government dialogue with the protesters and “free, fair, and credible” elections, scheduled for September." In the face of overwhelming protests going on in Egypt, the top U.S. diplomat was urging a dialogue through September. It is as though she viewed the current Egyptian president as legitimate in democratic terms, yet she also said: “We have been very clear that we want to see a transition to democracy. . . . And we want to see the kind of steps taken to bring that about. We want to see an orderly transition.”  If a transition to democracy means that the Egyption officials have not hitherto been legitimately elected democratically, then why was Clinton so timid? On February 1, 2011, The New York Times reported that President Obama had sent a message to President Mubarak through Frank Wisner that the Egyptian president not run for reelection in September. According to officials, it "was not a blunt demand for Mr. Mubarak to step aside now, but firm counsel that he should make way for a reform process that would culminate in free and fair elections in September to elect a new Egyptian leader." According to The New York Times, Obama was continuing his balancing act by "resisting calls for Mr. Mubarak to step down, even [while calling] "for an 'orderly transition' to a more politically open Egypt." As a result, it was still  not clear whether the Obama administration favored Mubarak turning over the reins to a transitional government. On February 5th, just days after suggesting that it wanted immediate change, the Obama administration said it would support an “orderly transition” managed by Egyptian Vice President Omar Suleiman. The New York Times reported that U.S. Secretary of State Hillary Clinton "said that Mr. Mubarak’s immediate resignation might complicate, rather than clear, Egypt’s path to democracy, given the requirements of Egypt’s Constitution." Not coincidentally, Israeli officials, who have long viewed Mr. Mubarak and Mr. Suleiman as stabilizing influences in a dangerous region, "have made clear to the administration that they support evolution rather than revolution in Egypt." Accordingly, U.S. Vice President Joseph Biden urged Vice President Suleiman on February 8th to take specific steps toward democracy. The technocratic turn presupposed the evolution rather than revolution approach, as per the interests of Israel and contrary to that of the Egyptian protesters.

The ambiguity in the Obama administration's "policy" on Egypt bespeaks an underlying lack of clarity in regarding principle as distinct from diplomatic expediency. At the time, the protestors in Egypt saw through the American strategic moves as such and continued to demand Mubarak's immediate resignation; the half-way, or "balanced," measures of convenience were regarded as wan from the standpoint of the protestors' acting on principle. I contend that both Hillary Clinton and Barak Obama put short-term tactical advantage above leadership. It should have been obvious that the breakdown of Egptian law and order and the accompanied strikes went beyond a need for "dialogue" and an evolution toward democracy. It was as though a soldier hemorrhaging on the battlefield were being told to relax and be orderly rather than that a tourniquet would be immediately applied.  It is sad, indeed, how bad things would need to get on the ground before the Obama administration would admit that a new government from the top was urgently necessary. In my view, the loss of law and order itself meant that the government had lost its right to govern. The U.S. administration lost this window by letting things "evolve."

If "real change" means anything, it surely involves departing from business as usual in order to lead by principle. Principled leadership entails taking risks. Indeed, tacticians are so cautious in part in order to obviate such risk. That is to say, principled leadership involves the risk that being guided by one's principles can involve short-run costs. As regards Egypt, standing up for the Egyptian protesters by saying that President Mubarak should step down immediately (and that no further U.S. aid would go to Egypt otherwise) would risk that president's displeasure should he retain power. Also, representative democracy unguided by Mubarak and his supporting offiicals could have brought to power parties such as the Muslim Brothershood that were not in the U.S. interest.  However, such is democracy; the victors of another country's elections are not necessarily going to favor U.S. interests. A principled leader would not be so selfish and manipulatory as to hold back from exercising principled leadership simply because he or she might suffer drawbacks. Ironically, the drawbacks might be less than expected, for a principled leader has such credibility from being authentic and principled that any resulting resentment is apt to be tempored by respect.



In general terms, the American problem lies in prioritizing self-interested calculation over principled leadership.  The American society has embraced the bureaucratic age such that leadership is exterpated and replaced with incremental strategic management--even in the Oval Office. Sadly,  being "professional" had replaced being "principled," such that the highest officials in the U.S. Government privileged the expertise of immediate tactical advantage over the principles that were innately felt by the Egyptian protesters (and presumably by ordinary Americans as well).  The American "leaders" had forgotten that in trying to have it both ways, they would be apt to end up stagnate, confused, and not well respected.  Were the officials bold in putting principle above immediate tactical advantage, I submit that the tenor of the U.S. government would better reflect the values of the American people. In the context of the Egyptian protests, as in that of the preceding Iranian protests, People the world over were crying out--yearning--for principled leadership rather than professional bureaucrats in the U.S. Government. It is in human nature to value and respect leaders who have the courage of conviction to say, "This might piss off some powerful people whom I could otherwise use, but this is what we as Americans believe in." Simply stated, the belief is that a government is no longer legitmate if it loses the consent of a significant number of citizen, especially if they are willing to put everything on the line to "just say no."  Incrementalist bureaurats look quite wan and feckless in comparison. Such officials have forgotten that management is not leadership; tactic is not principle. I suspect that the attempt by business schools to "managize" leadership into managerial strategy lies behind the "tactic as leadership" error. In other words, too many managers want to be known as leaders without actually leading. They treat leadership itself as a commodity that they can appropriate without actually being leaders. There is indeed an expertise in principled leadership, and I suspect an instinct for it, which the typical manager (and government official) does not have. I contend that principled leadership is more valuable than technical expertise in the upper echelons of organizations. 

The irony of the Egyptian protests and the muted or ambiguous incrementalist reactions of Barak Obama and Hillary Clinton, the American "dream team" of 2008, was that there was a disjucture between the U.S. Government and the American people. In other words, I suspect that the typical American preferred the stance of the protesters to that of our own "leaders." Perhaps one day an incrementalist and short-term oriented U.S. administration might find itself surrounded by protesting Americans. Will the government's answer be "evolution"? Citing the "need for dialogue" amid the country at a standstill would be laughable even if bureaucratic technocrats would still take their response to be "prudent" and thus appropriate. "Prudent" and "incremental" were not the words that came to my mind in watching the popular protests in Egypt in 2011. It was far easier to agree with the foreign protesters than with my own government.

Sources:

http://www.nytimes.com/2011/01/31/world/middleeast/31diplo.html?_r=1&hp

http://www.nytimes.com/2011/02/02/world/middleeast/02transition.html?_r=1&smid=tw-nytimes

http://www.nytimes.com/2011/02/09/world/middleeast/09diplomacy.html?_r=1&ref=todayspaper

 

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