The Managerial Attitude

"The demands for managerial attitude on the part of even the lowliest worker is an innovation" Peter F. Drucker

Action: What actions can you take now to impart a sense of managerial responsibility to your workforce? Peter F. Drucker

Before getting into today's topic, I hope you all get a chance to watch the Financial Crisis Inquiry Commission www.fcic.gov or www.cspan.org in action. Yesterday morning we had an amazing opportunity to watch the top 4 financial CEO's explain how the financial crisis happened (CEO's of those left standing). And then to experience expert opinion, some of which was obviously ignored by the players as the crisis evolved. What a fantastic learning experience, at minimum. Very interesting, illuminating, and unbelievable, so far.

• CEO Blankfein of Goldman, said that the main change that they made in management practice since the crisis: Do more "what if" stress testing.
• CEO Dimon of J.P. Morgan Chase, said that they never considered a scenario of 40% decline in the housing market
• Chairman Mack of Morgan Stanley, said continuous self questioning was the answer to never repeating the crisis.
• CEO Moynihan of B. of A., said better risk management was the answer.

All very much the same theme, namely: Test what we know we know! This was under oath, but do you believe these guys? Very smart leaders of America's major financial industry companies saying they didn't test (even privately) against a downside scenario, and leveraged themselves to the hilt? I say... Hog Wash! Bull S...! Kyle Blass in his extremely compelling testimony , said that he had shown the folks at Bear Stearns and in the govt. during that time, that even a flat housing market would be disastrous for our financial institutions because of the incredibly high leverage positions they had taken. I flat out, don't believe their testimony, under oath, shame on them... and it shouldn't be that hard to prove that one or all are lying through their teeth. Frankly it makes me angry that they think the American public and taxpayers are utter fools. But who is laughing all the way to their bank? These guys were caught up in the euphoria of competitive "one-up-man-ship"... I can only hope they will have to pay more in penalties.

That said, do heed my advice, which I have repeated throughout this blog. "Test what you know you know" in order to be better prepared for the future. Peter Solomon indicated that there was a heard mentality going on. An interesting new book to read while you watch this aftermath of financial market failure is: How Markets Fail: The Logic of Economic Calamities by John Cassidy

Back to today's blog topic. One way to answer the action item is to "Test what you know you know" and learn appropriate responses in that potential future. I'm not trying to be cute here. One of the most valuable tools I have been privileged to use in order to impart a sense of managerial responsibility to employees, has been a really neat derivative (not financial) of exactly that type of strategic gaming.

Example: For a large beverage manufacturer, faced with unprecedented competition, requiring new innovative thinking and solutions. As part of the "change communication program" we created a "strategy game" like monopoly for the employees to play with each other at company gatherings. Instead of the usual softball game at the company outing, the employees played "strategy". The game basically taught, through socratic questioning, how the industry, competitive dynamics etc. was now working, what the threats were, and drove employees who played the game to a superior understanding, a "managerial" understanding of the new dynamics they faced (it was the dramatic change in competitive dynamics that needed to be imparted, in order to inform the understanding for a need for change). The second part of the game, was a more robust generation of solution sets by those employees than ever before. In essence, putting employees in a position of understanding real strategic industry dynamics, and allowing the self questioning of what we know we know, put the company as a whole in a much better competitive position. Try it, "it" works with any size of company.