Posts Tagged ‘Crisis Management

24
May
11

Drop in Crime: What’s Up?

There was an interesting headline in this morning’s paper: “Experts are confounded by violent drop in crime across the U.S.” The most recent crime statistics showed crime at its lowest level in 40 years. The results totally baffled the experts (that’s always fun). They expected higher numbers due to the weakness in the economy and a lower incarceration rate. 

The experts have no explanations. The counterintuitive results also came in the face of large reductions last year. By all expert accounts, crime rates should be up sharply. Instead, the experts were left with no answers. 

Right above the crime story was this picture.

 

We were hit with serious tornados here in Minneapolis over the weekend. They ripped a six-mile path through the north side of the city. It’s not the destruction of Joplin, MO, but it has put a hole in a large part of the city. This is only one of a portfolio of pictures that show neighbors pulling together to bring their neighborhood back.

The same change is happening throughout our country. Tough times for everyone are bringing out the best in all of us. Instead of seeing the worst in each other, these times are causing us to see the best in each other and to reach out to those around us. More people, pulling tighter together, provide less space for criminals to operate. 

That’s one man’s opinion on the changes that are causing crime to drop. 

Oh…the only place in the country where crime increased across the board? 

New York City. 

Any theories on that?

 

 

 

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06
Mar
11

Changing Capitalism – Part 2

It’s time to refresh our capitalistic system. It is the greatest economic system ever devised by mankind and it requires constant attention and vigilance to maintain its relevance and vitality. These are times that demand that leaders step forward and take a courageous stand. 

At its core, capitalism depends on trust and leadership to survive and thrive. Right now, trust in business leaders is at an all-time low. We need to change business-as-usual in order to change the tide. If we don’t raise the bar and hold our profession to a higher standard, we will cede the right to control our future to politicians and regulators. 

Unfortunately, we deserve the ratings we are receiving right now. Our leaders have been involved in numerous ethical breaches from Enron to Wall Street. We have failed to truly embrace innovation in a way that harnesses all our talents and potential. We surrendered some of the strongest parts of our economy to foreign producers. As businesspeople, we have not done a terrific job in maintaining our world leadership. 

The Great Recession only emphasized these points. The downturn left us with high unemployment and slow growth. Our traditional growth engines have stalled with little opportunity for robust recovery. It’s unclear how we will grow in the future and people are looking for leaders who can make sense out of the present situation. 

It’s time for business leaders to step up and the downturn provides many opportunities. Managers can no longer masquerade as leaders: The present situation is too important and too fertile to be left to people looking for incremental solutions or actions that worked in the past. Stress opens gaps for genuine change and opportunities to engage in a new way. 

The true challenge to refresh capitalism is to raise the bar for all participants. It’s time to demand better performance on all fronts – not just the financial metrics. All of us must live up to a higher standard of personal performance and ethical benchmarks. It starts with each one of us individually answering the challenge. 

We live up to the standards individually, but we are judged collectively. Therefore, it is no longer acceptable to just look at our own performance and the performance of our charges. We must also accept responsibility for the actions of our peers and hold them to the same level of accountability. It’s no longer acceptable to say “I’m good” and leave clean-up to someone else. We are being judged as a group and we are only as strong as our weakest link. We can no longer stand by, wring our hands, and grumble about those who let us down. 

As leaders, we must demand more from the system. That means you and it means me. How are you making yourself better this week? How are you helping your organization live up to a higher standard? What are you doing to make that standard a norm in your community? 

It’s a difficult challenge…but no hill for climbers! Our future success demands that we set the new standard.

 Are you ready for the challenge?

 

27
Feb
11

Changing Capitalism — Part 1

We face a major crisis as we move through this time of change. The Great Recession highlighted the role of businesspeople and our collective ability to impact the world’s economy. We came up wanting in this review and are now on the defensive, fighting for our ability to retain the same control over our world. Trust in business leaders is at an all-time low. We need to change the game.  

It’s time to take a stand for capitalism – a new type of capitalism. It’s an all-inclusive form of capitalism that goes beyond financial statements. The new capitalism takes a long-term view of business and a broad view of our impact. The new capitalism watches the bottom line and the impact business has on all stakeholders. It requires a new structure and a new ethical perspective. This week we discuss how to change the game structurally. Next time we will explore the ethical impact of our actions. 

There’s a great article outlining the structural changes necessary to change the game in the March 2011 issue of the Harvard Business Review. Dominic Barton of McKinsey wrote “Capitalism for the Long Term.” In the article, he outlines three structural changes necessary to reposition capitalism:

  1.        Overcoming the tyranny of the short term;
  2.       Serving stakeholders and enriching shareholders; and
  3.       Acting like an owner.

Business leaders must take action to change the game on all three fronts.

We have been caught up in a self-perpetuating cycle of the short-term. Short-term returns from short-term owners have driven executives to focus on short-term results. The cycle continues to tighten as the pressure for higher and faster returns accelerates. Ironically, the focus on results actually reduces the enterprise value. New leaders must uncouple this cycle and have the courage and foresight to position the enterprise for the long-term. 

Adam Smith

Serving stakeholders and enriching shareholders have traditionally been seen as mutually exclusive. The new capitalism requires a return to some very old values – values outlined by Adam Smith in 1759. “All the members of human society stand in need of each others assistance, and are likewise exposed to mutual injuries…” Smith wrote outlining the interdependence between business and society at large and it never echoed as loud as it does now. Business needs a healthy society and vice-versa. It’s our responsibility to make both prosper. 

Acting Like Owners

Finally, there’s a need for all businesspeople to act like they own the place. Not just in the superficial way improvement consultants want us to approach day-to-day decisions, but also in the way we align our rewards with true ownership. That means a more sensible approach to pay, including real downside for top managers’ incentive plans. That also means stronger boards and a redefinition of shareholder democracy that rewards long-term ownership. These are all courageous stances – and all necessary to make a difference. 

These changes require new leadership. The traditional skills are still necessary, but no longer sufficient. New leaders must be able to lead from the rear as well as the front, integrating their entire teams into their activities. These three changes are just the start. In order for the changes to take root and grow, our ethical stance must also change… 

…but that’s next week’s blog!

 

 

20
Feb
11

Change Badger Style

I learn about change from many different sources. This time it’s been fascinating to watch the turmoil with the Wisconsin State Budget battle. The crisis is certainly a unique time in state government. I’ll let others analyze the politics. Instead, I prefer to look at the actions and consequences of the new Governor’s actions, and how it can apply to all of us. 

Scott Walker made it very clear that he would attack the budget deficits and state Unions would bear some of the brunt of his initiative. He won the election and his party took charge of the legislature. Gov. Walker was firmly within his rights and abilities to make the changes he proposed: Demanding that Unions pay for their benefits and curtailing their collective bargaining rights. 

He certainly caused incredible upheaval. Opposing Senators left the state in order to prevent the Senate from reaching the majority necessary to pass the bill. Tens of thousands of demonstrators flooded the Capitol and the surrounding square. Several school districts – including Madison and Milwaukee – were shut down as teachers joined the protests. All of this action brought national attention to the state, probably in an unwanted way.

 How many times do we plunge into change situations the same way? As bosses we have the legitimate right to make the changes we want in the way we want. We believe that if we communicate the change and it makes sense to us, all will go well. The change is made and very quickly we stumble into a gauntlet of unintended consequences.  

Change always takes more time and effort than expected. Communicating, gaining agreement, and implementing change is both an art and a science. Might doesn’t always make right, and our common sense is not necessarily our colleagues common sense. My experience says that most situations call for a pedantic approach to major change. Take time to plan, communicate, and understand the reactions to any moves. 

The reaction in our organizations rarely winds up in protests in the street. In fact, many times those reactions fail to reach the surface. Instead, disagreement goes underground, colleagues shut down, and key players can resort to malicious compliance in order to get by. We can create a situation every bit as complicated as Gov. Walker’s. 

As we watch the drama unfold in our neighbors’ Capitol, take the opportunity to reflect on how your approach to change can cause more disruption and reaction than you intended. The disruptions in your world may not make the nightly news, but they could have a bigger impact on your organization’s success.

 

06
Feb
11

Courage to Change

It takes courage to change. That was driven home to me through the world of politics and government this week.  

David BrooksI’m a big fan of David Brooks, the political commentator. He works very hard to develop deep, nuanced, and insightful perspectives on complicated situations. Brooks has a way of cutting through the clutter and getting to the heart of the matter. 

This week I heard him speak twice about the upcoming budget fight in Congress. On the positive side, Brooks sees cooperation in the coming weeks. It’s a great time for change and making good decisions about the future. There’s some great momentum to solve problems and get positive things done. 

Unfortunately, Brooks also fails to see the courage necessary to tackle the most difficult issues. Without that courage, it will be impossible to attack the ingrained entitlements in the system. Instead, we are likely to see cuts to programs that may actually generate returns and position the country for the future. A lack of courage may limit our future. 

I’m involved with Safe Passage, an organization that helps Minnesota counties focus on our at-risk kids. We focus attention on the most critical situations and facilitate solutions. Through this organization, I see the parallels in our state government. 

The state is in budget trouble. We are clearly spending too much money and having a difficult time coming to grips with competing interests. There are many obligations with few easy answers. Match that with little will or courage to compromise, and it becomes easy to pass the problems along. In our case, the requirements are passed to the counties – without funding – and the problem is solved. 

Is it the same in your life? Are there problems you can solve or situations that you can make better, but you aren’t acting? Is there something in your personal, professional, or community life that could benefit from your attention? Change requires courage to make a difference. It’s the perfect time to step up and move out of your comfort zone. Make an impact in a time where every impact is critical. 

Do you have the courage to change?

 

13
Dec
10

How WikiLeaks Will Change Your World!

 It was an interesting week as WikiLeaks continued to publish a steady stream of new documents and tidbits from their massive download of classified files. The reactions have covered the entire spectrum from “How dare they compromise national security” to “These are agents of change for an electronic society.” All of the points and counterpoints are very interesting. Still, I’m not hearing the right discussion. 

The leaks continued last week, unabated and uncensorable, as clone sites made sure any published information remained available on the Internet. “Old White Men” reacted in traditional, predictable, and outdated ways: attempting to shut down the site, cutting funding sources, and threatening legal action. 

All of this was largely ineffectual as unintended and unanticipated reactions cropped up. Other sites published the material. Hackers disrupted sites that opposed WikiLeaks. Other unknown cyber attacks were threatened as non-traditional sources of opposition arose. The technology and escalating consequences made it difficult and unlikely that any traditional reactions would slow WikiLeaks or their supporters in any substantial way. 

It’s been fascinating to watch the furor and discussion around the leaks. Everyone is much too focused on the leaks themselves. The perpetrators have been painted as traitors and criminals for what they have done. Very little of the discussion has been around the unprofessional actions and comments of our diplomats. That should be the real discussion. 

The extension of this discussion is what it means to your organization and how it can change your world. Your company is not likely to suffer the massive data loss from one source involved in the WikiLeaks episode. It’s more likely to be a slow drip of data from multiple places throughout the organization. It will happen and probably already is. The  Internet and social media platforms make it possible to discover almost anything. your organization should be discussing how outsiders view your organization and whether that’s the message you want delivered.

It’s imperative to engage in this new discussion. You have the ability to change the tone of the discussion and innoculate your company against future negative discussions. Have candid discussions in the open about your operations. There is plenty of data available. Find it and use it to improve your situation. Engage in constructive discussions.  

Transparency

Can you engage in these discussions and make transparency and authenticity a way of life? These qualities are essential in the new economy with the free flow of information that is available to anyone with a PC or a smart phone.

 

Are you ready to learn from WikiLeaks?

 

 

04
Dec
10

WikiLeaks Drives the Need for Transparency Home

We all know social media changes the game – both offensively and defensively. Offensively, the technology provides the opportunity to reach more people with more information faster and cheaper than ever before. Defensively, we can now hear people’s comments in real time and know what is being said about us. Mass communication is a much more democratic process. That means messy and accessible.

In this environment, transparency and authenticity becomes critical. Information travels quickly and freely between people and organizations. Nothing is secret anymore. Social media platforms make it possible to learn anything you want to know with either a PC or a smart phone. It’s impossible to manage a story or create a façade.

 WikiLeaks is driving that point home. In their latest high-profile leak, the website revealed internal State Department communications. Our diplomats thought their conversations were confidential and they made unflattering and unprofessional comments about foreign dignitaries. Those communications were discovered, disclosed, and posted to the Web. The reaction left our government scrambling to recover. 

Can your organization survive a similar incident? Do you embrace transparency and authenticity within your company? Personally? What if your confidential communications became public? Would those communications reveal professionalism and ethical conduct…or something else?

It takes hard work and consistent effort to create that environment. Leaders must set a clear vision and actively reinforce and clear set of values. They must consistently put in place the systems and practices to create a force of engaged and constructive employees. Finally, the entire enterprise must be kept on-track with constant, consistent, and multi-lateral communication.  

The game has changed. Have you put yourself in position to take advantage of the new social networks?

 




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