Bob MacDonald on Business

Sage Advice for Superior Business Management

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Governing is not a Good Profession for Heroes

April 26th, 2015 · Building Better Business Managers, Business Management, Effective Leadership

Being a hero calls for big and bold, while governing demands down and dirty.

On August 2, 2007, then-candidate Barak Obama first offered a pledge that he would often repeat during the presidential campaign. He promised, “As President, I will close Guantanamo, reject the Military Commissions Act and adhere to the Geneva Conventions. Our Constitution and our Uniform Code of Military Justice provide a framework for dealing with the terrorists.”

That was a popular position for a presidential candidate to take, because a majority of Americans had become revolted by scenes of prisoner abuse and flagrant torture, causing America to forfeit the high ground of morality when compared with the terrorists. In short, Americans were eager for a leader who would solve those issues and put them in the past.

How is the Obama promise going so far?

Not good at all.

It’s now six years later and “Gitmo” is still open with 122 detainees, making it the longest-standing war prison in U.S. history. Moreover, the Military Commissions Act is 2001-detaineesstill the primary judicial system for dealing with suspected terrorists and that act basically denies captured suspected terrorists any rights under the American jurisprudence system. Their court of last resort is military tribunals. Lastly, there have arguably been violations of the Geneva Convention and the Constitution in dealing with both American and foreign born suspected terrorists.

There is little doubt that Obama was genuine in his desire to fulfill his promise (along with many others), but he ran dead-smack into the political reality that – at least in the American form of government – it is easier to promise than perform. Obama’s dream of being the hero doing big and bold things collided with the reality that governing demands down and dirty work. President Obama is not the first, nor will he be the last to fall prey to the striking difference between leading and governing.

Those who run for President of the United States are motivated by many desires, but none is stronger than the craving for the power and the glory that comes with being the hero who will save the day. The problem is that once elected president, they have to govern the country and that always gets in the way of being a hero.

This is a conundrum for those who yearn to be president. The electorate longs for the heroic leader who will come riding in on a white steed to solve the problems and cure the ills of the country. Yet, the structure of our government is bipolar. It assigns the President the responsibility for creating policy and solving problems, but the power to do so is diffused. In the long run, this is most certainly a good thing, but it does mean that the president is less CEO and more COO, chief operating officer. Can you name one COO who is recognized as a “business hero?” Neither can I. And it is this mixed-message of the electorate pining for a heroic leader, but demanding an effective manager that forces the candidate for president to promise more than can be delivered and then, once in office, deliver less than has been promised. This results in a frustrated president, a disillusioned electorate and the problems being kicked down the road, waiting for the next “hero” to take them on.

Learn from government what not to do in business

This muddled confusion in government between the desire for a heroic leader who can offer a bold vision and the expectation of efficient management offers a good lesson for those who seek to be “heroes” in the business world.

First off, never accept a job filled with responsibility, but devoid of the authority to get the job done. This may seem obvious, but it is amazing how many who seek to move up in an organization accept new responsibility without confirming, let alone demanding, the authority to do the job. This can only lead to frustration and failure.

On the other side of the coin, when you are in a position of leadership – especially if you want to be a hero – it is critical never to promise more than can be delivered and always NeverPromisedeliver more than is promised. This is true for all parties to the business equation: those you work for, those who work for you and the customers you serve. Nothing destroys the credibility and confidence in a leader more than to promise more than is delivered. If you promise the moon, make sure you can deliver it – and it will be even better if you end up including the stars along with it.

It is difficult to be big and bold while getting down and dirty

It may be a cliché, but it is true that accomplishing great things is a team effort. Every team needs a leader, but every leader needs a team, too. As is said in sports, true team leaders, no matter how talented they may be, are most effective when they encourage others to be involved and get better and then allows all to bask in the glory of the accomplishment. It is no different in business.

The number one responsibility of any heroic leader is to be big and bold. To offer a clear vision that is challenging, inspiring and motivating, but that is not enough. The leader must put in place the actions that need to be done to accomplish the vision; this is accomplished by empowering, motivating and rewarding others to get down and dirty to do them. This allows the leader to present the vision for accomplishment and problem solving, and remain focused on it, while others concentrate on doing what needs to be done to make the vision a reality.

At the formation of LifeUSA – a startup life insurance company – my vision was that within five years the company would be a national company competing heads-up against – and beating – the biggest companies in the industry. My promise to those willing to join in and do the down and dirty work in what was seemingly an impossible effort, was that they would all share in the rewards for helping to make the vision a reality.

My responsibility as the leader was to keep the vision in the forefront and focused, while at the same time providing the encouragement, support, tools and – most important of all – the sharing of power that would allow others who had the ability to get down and dirty to do the things necessary to accomplish the vision.

And guess what? It worked. In five years LifeUSA was a national company competing effectively against the largest companies in the industry. And seven years after that, the promise of sharing in the value created was delivered when LifeUSA was sold to Allianz at a value of more than $500 million. All of those who relied on the promise made to to share in the value of the company, will tell you to this day that they received more than had been promised. I may have been considered the hero, but the real heroes were those who bought into the promise of shared rewards and got down and dirty to make the big and bold possible.

This just might be a good lesson for those who want to be President.

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Be Surprised if You Win the Lottery—But Not by Your Success

April 19th, 2015 · Business Management, Effective Leadership, Improving Your Business Leadership

If your success comes as a surprise to you, it means you were lucky, not good.

Success is the anticipated reward for hard work and commitment to achieving an objective, but many are convinced – or at least want to be – that success is the result of chance rather than choice. Those who fail to achieve success often account for their failure by rationalizing that the success of others is due to a “lucky break.” They equate the random luck of winning the lottery with how Winning-the-Lotterymost people win success. In their mind, failure to be successful is not their fault; they just were not as lucky as those who are successful.

Likewise, there is an intriguing reaction to success that comes from some of those who achieve it. Some see success as if it is the end of the road, when it is really only a sign that they are on the right road. Others reach a certain level of success and then begin to concentrate on enjoying the material rewards. They don’t understand that real success is determined by what is achieved, not what is received. And then there are those who, once they attain success, forget what it took to get there, and begin to act as if its continuance is preordained.

These attitudes about success contribute to the reality that more people rebound from failure than survive success. What many fail to grasp is that, as difficult as it may be to attain success, it is even more challenging to retain it. That’s because success has a way of cooling the passion and blunting the drive to achieve it.

Some Are Consistently More “Lucky” Than Others

Folklore supports the “lucky break” justification for failure by often highlighting the “overnight success” that is seemingly arbitrarily bestowed on the chosen few; it’s as if they had no part in the success —they just got lucky. Yet, when you go behind the scenes, you discover there is much more to the achievement. While there may have been a dollop of luck to be in the right place at the right time, the truth is that these individuals had toiled for years learning their craft and preparing themselves to be in the right place at the right time to achieve success. That instant success may be a surprise to others, but not to them.

In 1942, a middle-aged colonel, who had spent 27 years in the Army, but not one minute in battle, was selected over nearly 400 senior officers to lead U.S. forces in the war against Germany. (His immediate promotion to four-star general was the single biggest jump in rank in the history of the Army.) To say there was an army of naysayers carping about this decision would be an understatement. Those officers who were passed over and did not get the job claimed he was just lucky to have caught the eye of the Army and political leaders in Washington. The reality is that this obscure colonel had spent 27 years in the Army developing an intimate knowledge of military strategy and honing a remarkable talent for organizational ability and consensus-building. This “lucky guy” went on to serve as Supreme Allied Commander in Europe and after the war was elected to serve two terms as President of the United States.

When Dwight Eisenhower was once asked how he was able to emerge from almost 30 years Eisenhowerof obscurity in the Army to, almost instantly, become one of the towering figures of the 20th century, he remarked, “I knew that eventually opportunity would come my way and worked hard to be prepared when it did.” Eisenhower was probably the least surprised by his success, because he made himself the most prepared to be successful.

And that’s the point. If we win the lottery, we should be surprised, because we had no control over the outcome. Winning a lottery is a random happening that is not likely to be repeated. But we should never be surprised by our success, because we can plan and control the outcome. If we are surprised by our success, it means we did not plan for it. And if that’s the case, the chances are that our success will be a random event that is not likely to be sustained. If Eisenhower had not been prepared when opportunity came his way, no amount of luck would have allowed him to be successful.

It is certainly not on the level of an Eisenhower, but in my own career I have experienced firsthand the “just lucky” attitude about success.

When the company I helped found – Life USA – overcame high odds and the multitudes of skeptics to become the success story of the life insurance industry, I lost count of the number of people who came up to me and asked, “Aren’t you surprised by the success of LifeUSA?” My answer was always the same, “No! My only surprise is that it did not happen sooner.”

For many, my response may have seemed arrogant, but only because most people are surprised when they see others become successful. That’s because they see success as a random happenstance and that others were lucky to be in the way when it came by. The doubters assume that those who attain success must be surprised by it, because they certainly would be.

And yet, isn’t it interesting that these same individuals are not surprised – and maybe in a perverse way are happy – when they see failure? The failure of others gives many a place to hide from their own failure. The point is that when you prepare to be successful – rather than just hope for it – you are more likely to achieve it. And when you do achieve it, you are not surprised; nor should you be.

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Business Mavericks – Demented, Dysfunctional and Indispensable

April 12th, 2015 · Business Management

Business mavericks can drive you crazy, but they also drive success in any organization.

We all know the great modern-day entrepreneurial business mavericks such as Steve Jobs (Apple), Fred Smith (FedEx) Richard Branson (Virgin) and Bill Gates (Microsoft), but there are other business mavericks who toil unknown and often unappreciated in companies all across America. These unknown mavericks perform one very important function: They fight the urge of many in business to “stand-pat” with what has already been accomplished.

Despite resistance from those they try to help, these business mavericks are often the difference between success and failure of the company they work for. These are mavericks who, rather than create their own organization, make the organization they work in innovator1better because they refuse to be stifled by the organization.

What is amazing is that these business mavericks persist in a culture that values uniformity over uniqueness. Those in the business world who are content with the present see the maverick as a threat and respond by depicting these independent-minded individuals as malcontents. Thus the corporate business maverick is often treated as an outcast, filled with ridicule, rejection, recrimination and aloneness.

Yet, they stubbornly persist. There is something in their DNA that will not allow them to go along to get along. And whether they recognize it or not, the companies these mavericks work for are better because of them.

Sure, the vicissitudes of the corporate maverick can cause them to be an irritant, difficult to control and obstreperous. But instead of scorning them, businesses should encourage and regale the maverick within its ranks, because they drive change and innovation when it is most often needed, but goes unrecognized.

Sadly, change and innovation are often viewed as unwelcome visitors to those set in their ways and comfortable with the status quo. Nevertheless, the maverick plays a vital role in any organization, even if it is only to make others uncomfortable with the way things are.

Maverick Under the Microscope

A willingness to be out front and alone can be fun and even rewarding for the maverick. Certainly more fun than screwing the screw the same way everyone else does. But it does demand a particular psyche and different genetic makeup to be a maverick. Here’s what to look for.

For starters, mavericks have relentless curiosity. Have you noticed that in most corporate cultures, people may ask “how,” but rarely do they ask “why?” The maverick is rarely concerned about how things are done, but always want to know why they are being done. They are not willing to accept what has been for what could be.

The maverick has a compelling drive to look at the world through a kaleidoscope, rather than a microscope. This translates into an openness to try new things and do old things in new ways. Mavericks by nature question and challenge established procedures and mores. They at least want to explore new ideas and test their value.

But even that is not enough for the maverick. They know that thinking about a new idea is just a start; it needs nurturing and support. They understand the true value of an idea resides in its implementation. That is why the maverick is often irritatingly incessant in pushing for the exploration and testing of new ideas. As management expert Peter Drucker wrote, “Ideas are cheap and abundant. What is of value is the effective placement of these ideas into situations that develop into action.” Doing so is a key value of the maverick.

Despite often being ostracized by the keepers of the status quo, the maverick is not always a loner. In fact, by encouraging and exciting others to be more open in their thinking and acting, they can become true leaders. Most mavericks don’t put up with the heat of being different for their own benefit; they want things better for everyone.

Why Not More Mavericks?

If mavericks are so important to progress, why are there not more of them? After all, on the surface, being a maverick doesn’t require any special skills. You don’t have to have an MBA from an Ivy League school (actually that is probably more hindrance than help) or any other specialized training. The answer? We’ve got a defensive mechanism that learns early on to suppress the maverick mentality within us.

This mechanism to accept and conform starts at a young age. Children commonly exhibit the maverick’s inclination to question why things are done the way they are. As soon as children begin to talk they whyincessantly ask the irritating question, “Why?” And most often parents answer with, “Because that’s the way it is.” Schools only exacerbate the pressure on nascent mavericks. The educational system is based upon the pedagogy of answering questions, not asking them. Students are rewarded for the proper rote playback of answers, not for the ability to question the reasons for the answers or the assumptions behind the questions. The pressure is to “go along to get along.” Not surprisingly, most buckle under the pressure. By the time the student escapes the educational system and enters the business world, any tendency to think or act like a maverick has been exorcised as if it were a troublesome evil spirit.

And the Moral of the Story …

In the business world the connotation of a “maverick” is a negative one. To be a maverick is to be chastised as not being a “team player” and portrayed as a malcontent who is never happy with the way things are. In most corporate cultures the maverick must accept the enmity of the leadership because they are seen more as a threat to the present than a catalyst for the future. What is so sadly ironic in this situation is that the organizations most in need of the value that a maverick can bring are the ones most opposed to accepting a maverick in their presence.

The life of a maverick in the typical business environment is not easy, but it is a lot more fun and exciting than simply going along to get along. What is most rewarding for the maverick is when those who were most opposed to their ideas begin to copy and adopt them as is they were their own.

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