Dragged Down By Seeking Revenge

I've met quite a few people during my career that seem to fixate on the idea of getting "payback" for "injuries" both real and perceived. I've even been aware of a few instances when such a person successfully managed to take revenge on an enemy.

But more often than not, the attempt backfires, dragging the revenge-seeker, the victim, and often innocent bystanders down, damaging all of their reputations.

While seeking revenge is a fairly natural reaction to being wronged, it has absolutely no place in a business setting. Those seeking revenge are often caught, at least partially because they become so focused on "getting even" that they miss how the entire episode will be perceived once it comes to light. And these schemes almost always seem to come to light, making the instigator looks petty, childish, and untrustworthy.

For example, one of my direct reports -- a vice president of the company -- decided he wanted to "get even" with one of his peers. The original "offense" remained a mystery. Had I ever learned it, I likely would have concluded my revenge-seeking manager should have ignored it and gotten on with his job. Unfortunately, for some reason the man just couldn't allow things to slide. His method of getting even was more clever than most -- he sat back and watched his enemy plan an elaborate customer event (nearly 1,000 people for four days) without offering input or comment. At the last moment, he attempted to undermine the entire event by claiming "we couldn't afford to do it at the planned time," and that "he wasn't consulted."

In particular, the second claim irritated me. This manager had passively sat through two dozen meetings where details of the event were discussed. It was obvious he was "laying in the weeds" waiting for the right moment to embarrass his peer.

They attempt partially worked -- we ultimately delayed the event by a few months. But the instigating manager also appeared petty and stupid. Because all his other peers recognized the motivation behind the behavior, it reduced their willingness to work with the manager. While the man lasted several more years (I was transferred to another job a few months later, giving the guy a "reset" opportunity. Had I stayed, he was definitely on his way out.) he eventually retired early experiencing great stress. Few, if any, mourned his departure.

In another example, I watched as my boss attempted to take revenge on one of his peers. This particular boss was continuously involved in political infighting, and felt this particular peer had interfered with his shot at a key promotion.

The instigator's tactic was to simply criticize everything his target did. The action was well timed -- that particularly business unit was in a cyclical downturn -- and the victim was ultimately fired from his position. Whether the revenge tactics contributed to the executive's demise, is debatable.

Their mutual boss, however, recognized the roll the instigator played in stirring things up, and "rewarded" him by adding the peers responsibilities to his own. Ultimately, the instigator couldn't turn the cyclically down "sow's ear" of a business into a silk purse, and he too was fired.

Everyone recognized the contribution the revenge-seeker's own behavior made to his ultimate demise, and while most of us simply shook our heads the revenge scheme did nothing to enhance his reputation as a professional manager.

I'm sure there have been a few instances where a revenge-seeking employee was able to quietly put his plans in place, undermining or injuring a competitor without others recognizing what was going on. But when it is recognized, when it is plainly obvious what is going one -- which experience convinces me is most of the time -- the revenge-seeker inflicts more injury to himself than to his target.

If you want to carefully manage your career, leave revenge for Hollywood. Instead simply act like an adult and do your job. 21.2

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Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and HEIR APPARENT. Coming soon -- PURSUING OTHER OPPORTUNITIES

Non-Fiction: NAVIGATING CORPORATE POLITICS

Shown here is the cover of NAVIGATING CORPORATE POLITICS my non-fiction primer on the nature of politics in large corporations, and the management of your career in such an environment. This is my best selling book. Chocked full of practical advice, I've heard many career-oriented people say they wished they'd read it early in their career.

My novels are based on extensions of my 27 years of personal experience as a senior manager in public corporations. Most were inspired by real events.

The Wisdom of Those Who Went Before You

Being stuck on the past has always bothered me, particularly when "being stuck" is of the "...we tried that and it didn't work" variety. I've encountered this attitude in pretty much every job I've ever had, and my instinctive reaction is to think "you guys just didn't do it right."

Sometimes that instinct has proven to be correct, but in most of my experiences it was wrong. In a few instances, damned wrong.

That initial reaction is, I believe, one born out of arrogance. It falls in the "I'm smarter, harder working, more insightful, more clever, etc." then those that came before me. This almost always proves not to be the case. Arrogance is NOT a business asset. In fact, it sets you up for an even bigger fall than you would experience in its absence, and pretty much guarantees there will be people standing on the sidelines cheering when you stumble.

In reality, a failure to implement anything similar to what you are contemplating should be a giant, flashing, warning sign telling you to slow down and analyze things from every angle.

After all, maybe your version of the idea will actually work better. Maybe barrier that previously prevented the idea's successful implementation has changed. Maybe the previous implementation effort was done without craft or cleverness.

Yeah, and maybe pigs really can fly.

Most likely you'll be tripped up by the same things that caused issues the last time a version of the idea was tried. Go forward, and you're just asking for problems.

But you're still convinced that you can do it, aren't you?

In that case, take the time to interview people that were around during the last go round. Get a detailed download on exactly what barriers were encountered, and what ultimately led to the failure. Don't assume you know, don't jump to erroneous conclusions, instead carefully listen. Then plan, review, and really convince yourself that what you're doing is going to produce a different result.

The odds are good that you'll convince yourself, but the odds are also good it will be wishful thinking.

So you should test out your "revised plan" with some of the old timers, and see if they agree your changes will assure success.

I'm betting they will say "no." At which point, you should go back to the drawing boards or punt altogether.

My favorite example of how NOT to benefit from the wisdom of those who went before you comes from a plan I once tried to implement, one involving the roll up independent distributors.

The logic behind the idea went as follows: It is terribly difficult to get independent distributors to act in the way you want. My employer wanted to emphasize technological prowess, and the distributors wanted to focus on product reliability. If we just owned them we could make the salespeople behave the way we wanted. Oh, and we could also capture the distributor's share of the value chain's profits, adding it to our own and making our shareholders happy.

This idea was wrong in so many ways that I can't, in the space available for this blog post, begin to explain the foolishness of the concept.

More to the point, however, the company had actually tried to do this exact same thing ten years earlier. And the resulting distributor performance had ranged from mediocre to downright horrible.

I'd come to the job from a company with a direct sales force, however, and due to my frustrations with the independent dealers, I loved the roll-up concept. So what did I do? I brushed aside the previous failure.

In my opinion at the time, the project had failed because: It was done for the wrong reason (profit enhancement rather than sales process control), it was managed inadequately (a part time leader versus a dedicated expert in distribution management), it was attempted at the wrong time (when the market was less mature). Most importantly, I believed I would succeed because I was smarter and and harder working than the prior managers that had failed.

I was certain I would make it work.

But I couldn't.

The first few acquisitions were made with great fanfare. I hired a very capable manager to run the unit, and he appointed top talent to manage the acquired distributors. But results sagged when compared to the distributor's performance prior to acquisition. Some of the problems were caused by the natural business cycle (we'd purchased near the market peak -- go figure), but many more were caused by the fact that we had MANAGERS running the businesses rather than OWNERS. Costs rose, efficiency dropped, more capital was "required." We took nice little businesses, and turn them into mediocre businesses. That was, until something bad happened like a manager quit, or an employee was found stealing -- then things got ugly.

Funny thing was, these were exactly the same problems that had caused the earlier effort to stumble. I'd completely failed to learn anything from those who went before me.

In the end, the entire episode could have been avoided simply by delving more deeply into the "whys" of the previous failure, and by realistically assessing how my plan would (or wouldn't) change the outcome. Of course, it would have also required suppressing my arrogance, and taking a cautious approach. This was a lesson I eventually learned, but one that took additional repetitions of the same process before it sunk in.

So if you find yourself in a similar situation, control your ego and learn the lessons of the past by listening, analyzing, and planning, rather than committing errors that have already once been committed. 21.1

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Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and HEIR APPARENT. Coming soon -- PURSUING OTHER OPPORTUNITIES

Non-Fiction: NAVIGATING CORPORATE POLITICS

To the right is the cover for DELIVERABLES. This novel features a senior manager approached by government officials to spy on his employer, complete with a story about how a "deal" they are negotiating might put critical technical secrets into the hands of enemies of the United States. Of course, everything is not exactly as it seems....

My novels are based on extensions of 27 years of personal experiences as a senior manager in public corporations.

Non-Fiction: NAVIGATING CORPORATE POLITICS

Where Loyalty Truly Lies

Ownership percentages do not determine employee loyalty, relationships do. Culture, proximity, history, and the expected future all play a bigger role in this than ownership. When we develop partnerships, joint ventures, license agreements, and other similar "partnering ventures," it is important to take steps to capture the loyalty you deserve, and be realistic about how just much loyalty you can achieve.

At some point in their careers, many managers become involved in a partnering venture with another entity. The purpose of such a relationship may be to access new geographic areas, leverage a skill or ability into a new product or market, or create a new, powerful entity to take on a tough competitor. No matter what the stated purpose, however, you can be sure there will be differences in the way the original partners see things, be it in priorities, approaches, acceptable risk levels, or simple things like who to hire. Expect each partner to attempt to influence senior management to tip the scales in their favor. In this internecine battle, loyalty is the key factor in determining who wins and who loses.

All agreements of this type will have a way of sorting out those differences, usually beginning with some kind of discussion process surrounding a board or other governance body, and culminating in a formal vote typically ruled by the largest shareholder. You would expect that since everyone knows this is the process that backstops day-to-day decision making, it would put the largest shareholder pretty much in charge of everything.

That, however, is often not the case.

I've always said that when the venture becomes so mired in conflict that the formal dispute resolution process must be invoked, the business's days are numbered. Since we don't normally resort to this legalistic formal process, day-to-day decisions are normally made by the managers working in the business. The series of day-to-day decisions, when strung together, make up the real, underlying strategy and direction of the entity. Those short-term, day-to-day decisions are, in turn, open to influence by the minority partner utilizing any combination of several key factors including: Culture, proximity, history, and expected future.

Culture

In a joint venture between a German and a Korean company, I had a front row seat for a major culture clash. In this case, I was a supplier to both companies, and was able to see both sides of the resulting, messy conflict. I watched the design responsible German firm and the Korean manufacturing entity go though a curious dance over and over again, quarter after quarter -- much to the frustration of the German engineers. At every meeting, the Germans emphasized the importance of process, procedure, and discipline during the product design and development phases of the project. The Korean representatives would agree to everything the Germans demanded, but would then go back home and do whatever they thought best. Then the process would be repeated, with the Germans becoming more agitated in each successive cycle.

Ultimately, the Korean partner ran the project exactly the way they wanted, despite the German firm holding majority ownership. The reason? They controlled what was happening on the ground at the manufacturing plant, and culturally were determined to do things their own way. Politely, I might add.

Proximity

A joint venture I started in western China was particularly vexing for me. My employer was the majority owner, but I was half a world away and the partner had their headquarters in the same city as the venture. Visiting for a board meeting once every few months became an exercise in frustration, as pretty much everything agreed to at the last meeting had been "forgotten" by the next, and activities in the joint venture reverted to the agenda of the minority share partner. This had everything to do with the amount of day-to-day contact the partner had with managers in the joint venture. Even when we appointed a board member who resided in Beijing, the situation barely improved. It wasn't until that board member spent close to fifty percent of his time at the JV, that the situation began to turn around.

Unfortunately, by then it was too late -- the venture was out of cash, and no one had a stomach for pumping more money into the frustrating business.

History

Another joint venture, this one in Brazil, provided a different lesson, this on the importance of history. My employer entered a joint venture with a local manufacturer, and a family member of the minority partner ran the business. The senior management team consisted of managers hired by the minority partner before we became involved (in fact, we were a competitor during those days). The management team had been through severe ups and downs together, including hyperinflation and a bankruptcy. Because of the shared history among this tight-knit team, I never had a chance of capturing their loyalty. And although the general manager of this operation was relatively easy to work with -- and saw things eye-to-eye with me much more often than he did not -- the lack of control still created problems on several occasions. This particularly when I was concerned about the potential of trade embargo violations.

Future

A joint venture in India also proved to be problematic, this time because of the future prospects of a key manager. In this case, the general manager of the operation had been hired from outside of the partner's organization specifically to prevent the type of problems I described in the above Brazil example. Unfortunately, the partner promised this manager would have a long term career and plenty of opportunities with them -- a promise we couldn't match. Because of his future prospects were with the minority partner and not with us, his loyalty went laid in the same direction. In this case, that loyalty went so far that he allowed the partner to divert profits from the venture into one of the partner's businesses by agreeing to a component supply contract with massively inflated prices.

As you can see from the above examples, control counts for something, but loyalty counts for more. And while capturing and retaining the loyalty of key employees is most challenging with international ventures, it happens within domestic markets, as well.

If you're contemplating a partnering arrangement, spend plenty of time assessing and designing the venture so you capture the loyalty of the key employees. If you already have such a venture, take whatever actions you can to shift the loyalty equation in your favor to the maximum degree possible. Your time and money spent will help ensure you aren't facing a disastrous difference of opinions somewhere down the road. 20.6

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If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and HEIR APPARENT. Coming soon -- PURSUING OTHER OPPORTUNITIES

Non-Fiction: NAVIGATING CORPORATE POLITICS

This is a montage of all of my current book covers, in the order of publication.

Sold on a Story

When you're a senior manager, your inspiration can come from several places -- perhaps from something you've read, an abstraction of something you've seen done before, even something that you just thought up in your own head. I've successfully developed ideas that came from all these sources, and more.

The common thread linking these sources is YOUR judgment. You can make most of them work, as long as you're convinced it is a good idea, project, or objective. As long as you believe.

Notice I said you can make MOST of them work. Some ideas are just bad from the start (apologies to advocates of the no-idea-is-a-bad-idea thing -- I personally don't buy it), and no amount of belief, wishful thinking, or, for that matter, hard work, will ever turn them into successes.

But if you reason your way through the idea, test it against your common sense and experience, and you're convinced you've got a winner, chances are pretty good you'll be able to pull it off.

You're in a completely different realm, however, when you're being sold a story by someone else. My advice: If you can't get 100% behind the idea, with a level of enthusiasm and confidence that matches the person doing the selling, then DON'T GO FORWARD with the project.

Unfortunately, this is a lesson I've had to learn the hard way. Several times over, in fact, before it completely sunk in.

When someone is selling you a story, you need to be personally confident on all fronts -- that means being excited about the upside, relatively unconcerned about the risks and, most importantly, having a complete understanding of how all aspects of the idea -- technical, commercial, existential, you name it -- will work. The devil is in the details, so you must take the time to drill deep before providing your endorsement. And run, not walk, in the other direction if you can't.

Here are a few examples that illustrate the above points:

Once while running a business where profitability was highly dependent on steel costs, I was faced with an ugly problem. Steel costs were rising rapidly, and if I didn't increase prices immediately, our profitability would be severely damaged. The problem was, none of my competitors seemed to be interested in doing anything. A few "trial balloon" increases were ignored by the competitors, and rumors were circulating that one of them was "committed" to holding price. I knew that eventually every manufacturer in the industry would feel the same pressure we were, the only problem was the word "eventually." I knew I needed to do something.

When I checked with my staff, most were opposed to my proposed solution -- to lead with a bold statement of our intent to follow steel prices as they rose while offering the competition subtle encouragement to follow. I was convinced it was the right course of action, however, so I pushed it through. For the next eight weeks, I was the most hated and vilified person in the company. Then a curious thing happened, the competitors started to match our increase. Encouraged, I pushed prices up again, and this time they quickly followed. In the end, our profits were actually enhanced during a period of rapid inflation and our share position suffered only modestly

In that case, I developed the idea myself, and was convinced it would work.

In another pricing example, my VP of Sales wanted to abandon transaction-based discounting in favor of a schedule of discounts and incentives. Conventional wisdom said that by doing so, we would lose significant market share as we kissed goodbye many of the most price sensitive deals. But I was convinced by the VP that the outcome would be different, noting that we were in a very poor position to make smart decisions when it came to transaction discounts. I spent a substantial amount of time investigating the details of the scheme, and when it was eventually implemented, it was a resounding success.

In this example, the idea wasn't my own, but I took the time to convince myself it was a wise move.

On the other end of the spectrum was an international joint venture advocated by the VP of International. From the beginning I was suspicious of the partner, thought the strategy was weak, and knew the venture would likely be a big drain on management. Counter balancing that was the fact that we'd had our asses handed to us in the target territory by a second-tier competitor during the prior year. The pressure was intense to do "something."

Despite my misgivings, I simply gave in to the VP, and moved ahead. It was a management failure on my part because even though I had significant doubts about the project, I caved to the pressure. In short, I was sold on the story and the enthusiasm the VP showed for both the partner and the project. I was essentially substituting his judgment on the project for my own.

It didn't turn out to be a wise decision. Five years and thousands of management hours (not to mention hundreds of thousands of dollars) later, we were stuck with a non-function joint venture and a do-nothing partner. There were few prospects for improvement.

If I'd only avoided getting sucked in by the story. 20.5

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If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and HEIR APPARENT. Coming soon -- PURSUING OTHER OPPORTUNITIES

Non-Fiction: NAVIGATING CORPORATE POLITICS

This is the cover of my new, and soon to be released novel, PURSUING OTHER OPPORTUNITIES. This story marks the return of LEVERAGE characters Mark Carson and Cathy Chin, now going by the name of Matt and Sandy Lively and on the run from the FBI. The pair are working for a remote British Columbia lodge specializing in Corporate adventure/retreats for senior executives. When the Redhouse Consulting retreat goes horribly wrong, Matt finds himself pursuing kidnappers through the wilderness, while Sandy simultaneously tries to fend off an inquisitive police detective and an aggressive lodge owner.

My novels are based on extensions of my 27 years of personal experience as a senior manager in public corporations. Most were inspired by real events.

Different isn't Necessarily Better

At least not when it comes to business partnerships.

As a general rule, I've never come across a completely ideal partner for joint ventures, licenses, or any form of shared production and/or marketing deal. Each partner brings their unique view of the world to the partnership, including their take on governance, priorities, expectations, ethics, and the like.

My ideal partner would be completely transparent and ethical, flexible on their needs so that I can meet mine, and nearly like me in most ways.

That pretty much explains why the ideal is never attained.

But where do you draw the line, recognizing that your potential partner is simply too "different" for you to bridge the gap? Where are their differences in strategy, culture, and norms a mere inconvenience that can be overcome?

That's a question only you can answer. But I can at least describe a few deals where the differences were so large, that the gap either couldn't be bridged, or where I would have been well advised to not attempt to do so. None of these ended prettily.

I once inherited an Indian joint venture that, despite the initial expectations, eventually became a complete mess. When I made my first trip to visit the JV's operations, I was quite impressed with the partner. They were large, having multiple JV's with a variety of western companies, as well as several wholly owned businesses of their own. The owner's son, the primary person I interacted with, was educated in Europe and appeared to be both affable and sensible. After the trip, which was undertaken to figure out why the joint venture's results were so poor, I learned that our partner was sucking all the profits out of the venture. This was accomplished by charging outrageous prices for the components they were manufacturing and supplying to the business with one of their other companies. In that instance, the partner's sense of honesty and fair play was so radically different from ours, that it never even occurred to me that they might be stealing from us.

An inherited license agreement with a company in Saudi Arabia provided a similar lesson. Although our contract clearly stated that we owned the technology, and the partner retained no rights to it at the termination of the license, they had no problem stealing our drawings, specifications, and marketing materials by superficially altering them. They relied on the legal venue -- in Saudi -- as their trump card in their attempt to escape the intent of the deal. Of course, I already knew there would be problems when I earlier realized that everything the partner told me needed to be independently verified to be believed. While having a partner like this was manageable during the agreement -- although very time and effort consuming -- when it came time for the deal to end, their behavior was predictable and the results, disastrous.

I was smarter when contemplating a joint venture with a department of the Chinese government. Discussions were friendly, but when I insisted the partner accomplish some simple market research prior to completing the deal, it became obvious that they would provide nothing of value to the proposed project. Thankfully, we never launched it.

A similar experience occurred with a proposed venture with an Israeli Kibbutz. In that case, however, I was eager to press forward with a deal, and it was my boss that pulled the plug on it. I'm not positive that the project would have been unmanageable, but there is no doubt it would have had some major challenges.

All of the above examples were from proposed International deals. Extra caution should be taken when considering these ventures. While the tenets of business that are more or less common around the world ease some of the differences between cultures, there are often still major differences that may make a long term business relationship a huge challenge. Know the country, know local business practices, get to know the key leaders in the partner organization. If you are seeing major differences between your needs/beliefs and those of the proposed partner -- particularly when it comes to ethical behavior -- stay away.

Similar problems can also happen in relationships within the same country. In one instance, I became involved in a joint venture with a partner in the U.S. where the partner had absolutely no interest in pursuing any of my firm's priorities. What the partner wanted was cash to fund an ill-considered expansion. Within a short time of signing our agreement the partner began to balk at everything action we proposed or suggested. I received a further wake-up call when I observed the partner have a contentious meeting with a supplier, one where he misrepresented the facts surrounding a warranty problem in order to get concessions (primarily warranty dollars). Doing that would have resulted in discipline, even termination, at our firm. Needless to say, that relationship didn't end well.

While difference can sometimes create complimentary strengths and weaknesses in a business partnership, it more often will create problems that make the ongoing management of the relationship difficult, if not impossible. If you're contemplating a partnership, study those differences intently, and try to be realistic about the potential challenges of working together down the road. If you've inherited a problematic relationship, you may as well come to grips with the challenges and study your options right away. Hoping things will get better on their own is unrealistic and foolish. In some cases, you may even need to unwind the deal. 20.4

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and HEIR APPARENT. Coming soon -- PURSUING OTHER OPPORTUNITIES

Non-Fiction: NAVIGATING CORPORATE POLITICS

When you're worth hundreds of millions of dollars, the remote wilderness can be anything but safe.

This is the cover of my new, and soon to be released novel, PURSUING OTHER OPPORTUNITIES. This story marks the return of LEVERAGE characters Mark Carson and Cathy Chin, now going by the name of Matt and Sandy Lively and on the run from the FBI. The pair are working for a remote British Columbia lodge specializing in Corporate adventure/retreats for senior executives. When the Redhouse Consulting retreat goes horribly wrong, Matt finds himself pursuing kidnappers through the wilderness, while Sandy simultaneously tries to fend off an inquisitive police detective and an aggressive lodge owner.

My novels are based on extensions of my 27 years of personal experience as a senior manager in public corporations. Most were inspired by real events.

Institutional Amnesia

Ever read another person's class notes, ones that were written only to themselves? If you have, it probably made you wonder, at least in one place or two, what was meant by the words written there. While the author clearly knew what she was writing, for a third party to get to the meaning behind such words can take some detective work, utilizing both context clues, and your understand of the person behind the words.

While this can be sorted out with personal notes, a contractual agreement is a completely different kettle of fish. Even though extreme care is supposedly taken with such documents, I've run into unclearly written contracts quite often.

Just like in the personal notes, the authors of the contract "knew what they meant to say." Unfortunately, relying on the authors, when it comes to a contractual agreement, is often not practical.

"Institutional Memory" is a term that I'm going to appropriate for this post, applying it in a slightly non-conventional way. Normally, "Institutional Memory" refers to the body of knowledge shared by members of an organization, often knowledge that isn't codified. In my special usage, let's assume that this knowledge extends to the agreements between parties, and what was actually meant by the written agreements they make. The point is, "Institutional Memory" is embedded in people, rather than in the words themselves

Many agreements unintentionally rely on this "Institutional memory," this shared understanding, when the contract is developed. The problem is, the intent of the contract is buried in the heads of the people involved in the negotiations. When those people change or are replaced, the "Institutional Memory" fails. At that point, we often end up with "Institutional Amnesia," which is typically reverts back to a literal interpretation of the contract. Of course, those interpretations are often biased in favor of the interpreting party.

I've most often seen problems occur with long-term contracts between companies. This would mainly be agreements such as: Joint ventures, partnerships, shareholder agreements, technology agreements, licenses, etc. The most vulnerable agreements seem to be ones where there is an imbalance in the timing of when each side of the agreement extracts the value they want from the relationship. For example, in a joint venture agreement, the seller usually gets cash up front, while the buyer is typically relying on longer term benefits. Because of "Institutional Amnesia," there can be a real risk of opportunistic interpretation of the contract down the road by either side of the agreement, particularly when one or both of the primary negotiators of the original agreement move on to other jobs. Issues seem to be smaller when both parties are extracting their value from the agreement over roughly the same timeline (such as with a long-term supply contract).

The devil is in the details. I've seen "Institutional Amnesia" take over primarily with the detailed mechanics of the agreement. How is the share price supposed to be calculated, exactly? How do we draw the line between covered and non-covered latent liabilities? What are the exact steps needed to force a management change? How do we draw the line between an allowable and a disallowed use of the licensed technology? "Institutional Amnesia" is opportunistic. It encourages the "forgetful" entity to re-interpret the agreement so that they maintain technical compliance, but still manage to avoid the intent of what was written. Sometimes the agreements are so poorly written, it is difficult to establish either intent or technical compliance. Under those circumstances, the door is wide open for manipulation.

In a foreign licensee, we were reaching the planned end of the contract and there was a major issue brewing over territory. Getting an extension on the agreement required solving this issue but, unfortunately, the "Institutional Amnesia" surrounding the details of end of license with respect to ownership of the technology created an additional major complication. It seemed the licensee "believed" that the agreement allowed the returning drawings and specifications to us, but did not prevent them from entering the space as a direct competitor. As a result, the other party maintained that they could "create their own drawing and specifications," even though that was clearly not the intent of the original contract. Unfortunately, the wording of the contract wasn't completely clear. Since the agreement didn't specifically forbid them copying and altering drawings and specifications (by replacing our name and logo with theirs), they proceeded to do just that. In the end, we were severely hampered by the poor contractual wording.

In another example, I was forced to remove a partner in a joint venture after he ran the business into the ditch. Such an eventuality was anticipated, but the details of how to do it were never included in the shareholder's agreement. As a result, innumerable hours were spent choreographing the event. Even after all the preparatory work, I made enough mistakes that we were still eventually sued. The whole problem could have been avioded with a contract that carefully enumerated the understanding between the two sides.

I know most managers dislike long, complex contracts. And 80% of the time, 99% of the provisions covered in the contract are never referenced. In those cases where it is needed, however, clarity of intent is absolutely critical. Wording counts. Taking the (often tedious) time needed to make sure everything is clear, correct, and represents the entire understanding between the parties is absolutely critical to protecting you and your employer down the road.

What do you do if you inherit a poorly written contract?

There are two approaches to dealing with this issue. Unfortunately, the first one can only be used prior the commencement of troubled times. You should carefully review any inherited contracts (or, better yet, get an independent attorney to do so), and make sure there is common understanding and interpretation on any unclear or controversial items. This absolutely must be done in writing, and may even require an amendment to the contract, depending on how poorly written the original was to begin with.

Once trouble starts, however, (such as the approach of the end of the license agreement in the first example above) the only thing you can do is renegotiate based on a literal interpretation of the contract. While you might be able to get the partner to agree to some or all of the "intent" of the original agreement, my experience is that rarely happens (worth trying, however). In many cases, what you thought you had locked in will prove to be unenforceable, and you'll end up with a much less favorable agreement.

Of course, you can always agree to disagree, which will most likely result in a legal or market battle of some sort.

Clearly, it pays to get things straight before a rough spot is reached.

The bottom line is you can't rely on "Institutional Memory" when it comes to your long term contracts. Instead, you must plan for "Institutional Amnesia." Your best bet as a manager is to be far out in front of any contractual problems, whether of your own making or inherited. When you make a new contract, take the time necessary to make sure your intent, particularly when it comes to all contingencies, is properly and accurately reflected in the contract. A good strategy is to let a savvy non-participating manager read it without coaching, and have her tell you what she thinks it says. Your successors will thank you, and it might even benefit you if there is a change in personnel on the other side of the agreement. 20.3

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If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and HEIR APPARENT. Coming soon -- PURSUING OTHER OPPORTUNITIES

Non-Fiction: NAVIGATING CORPORATE POLITICS

This is the cover of the Audiobook version of LEVERAGE, which I narrated. The story revolves around an offbeat engineer working for Global Guidance Corporation who shows up one night at Mark Carson's house shot and bleeding out. Mark decides to investigate the crime himself, and plenty of complications ensue as he uncovers a wild conspiracy.

My novels are based on extensions of my 27 years of personal experience as a senior manager in public corporations. Most were inspired by real events.

Pressured to do "Something"

"Do something. Even if it's wrong it's better than just waiting."

"You have to make a decision."

"Let's get started, and we'll figure it out as we go."

Over the years, I've heard many variations of this particular bit if advice. In some instances I was influenced by the implicit pressure, while other times I was able to successfully resist. One thing I can now say for certain is that some of my worst decisions were made while relying on these types of arguments as the justification for forging ahead.

The truth of the matter is, if you feel uncomfortable about a decision, there is probably a good reason for that. Giving in to pressure under such circumstances is a prescription for trouble. It is quite rare to run into a situation where you don't have the time to satisfy yourself on any point that makes you uneasy. To make good decisions requires examination of piles of information including: estimating the most likely outcome, developing best and worst case scenarios, assessing project risks, interpreting political risks, figuring out likelihood of success, and plenty of other factors. Making complex decisions is as much an intuitive process as it is a calculation. Getting comfortable with these factors shouldn't be rushed.

And if your gut tells you to hold off, it's almost certainly a bad idea to let others push you into moving forward.

I recall several instances where I felt rushed into things. A few times I resisted external pressure and things came out okay, Others, especially when I gave in, turned into major disasters.

For a number of years, I was on the receiving end of strong pressure to get a project started in China. The first time this came up, I held meetings with a Chinese government agency responsible for a couple of semi-failed factories originally set up to copy an older version of our product. The proposed path forward was for us to develop a joint venture with the factory, update the manufacturing operations, and upgrade to our latest designs. The partner would take responsibility to drive sales in China, and we would provide export sales. Everything sounded reasonable on paper.

But I wasn't comfortable, probably because I already had bruises from previous ventures in China under my belt.

Instead of succumbing to the pressure, I set some basic goals for the partner to achieve before negotiations moved forward. When the people we were talking to couldn't get those done, the talks fell apart. As far as I was concerned, it was a bullet dodged.

A few years later, I wasn't quite so lucky. In that instance, the deal was similar to the one I just described, but in this case the partner was a publically-listed firmthat seemed to have reasonable commercial capabilities. Still, I had my doubts.

By this time, I'd been fighting the pressure to establish just this type of arrangement for several years. I had been worn down. After again setting some hurdles -- ones that our own people helped the partner to complete -- I gave in. We inked a deal that ultimately led nowhere. In the process, I wasted substantial management time and financial resources trying to turn a bad idea into something tolerable. In the end, I had to rate the project as an abject failure.

In my final example, I set some longer term goals for the development of a new manufacturing process that would greatly reduce my employer's overall costs and provide a competitive advantage to the company. While the concept was promising, there were a number of "kinks" to work out before the project was ready for investment.

Unfortunately, an "opportunity" emerged to make the investment and avoid another capital expenditure. The only problem was it was at least a year too early. The pressure I felt to move forward, in this case, was primarily self-imposed. I ended up proposing the project despite the fact that there were still several major unknowns in the technology.

You would have thought I'd know better by then.

Every major area of innovation created problems during implementation. And there were several "sure things" that also caused difficulty. The project fell far behind schedule, and eventually it became clear the initial productivity and cost projections would never be achieved.

That failure cost me. I lost loads of credibility, and ultimately my job.

If I'd simply waited, completing the development program according to my original timeline, and patiently watched for a less risky opportunity to implement the project, things likely would have been different.

So when you feel pressured to do "something," chances are you should probably sit back, relax, and make triple-sure you really are convinced any decision you make is the right one. 20.2

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and HEIR APPARENT. Coming soon -- PURSUING OTHER OPPORTUNITIES

Non-Fiction: NAVIGATING CORPORATE POLITICS

The written version of the sequel to LEVERAGE, titled PURSUING OTHER OPPORTUNITIES, will be released in early 2014.

To the right is the cover of the Audiobook version of LEVERAGE, which I narrated. The story revolves around an offbeat engineer working for Global Guidance Corporation who shows up one night at Mark Carson's house shot and bleeding out. Mark decides to investigate the crime himself, and plenty of complications ensue as he uncovers a wild conspiracy.

My novels are based on extensions of my 27 years of personal experience as a senior manager in public corporations. Most were inspired by real events.

On Your Own in China

Over the course of several jobs, I've gained a degree of experience working in China. To say it is challenging, even certain to result in numerous "learning experiences" (read: mistakes) has been, in my experience, an understatement. And while some of the lessons I learned are particular to the Chinese experience, most can be applied to ventures in other places around the world.

My next five posts will address lessons from foreign ventures in general. In this post I want to confine myself to elements unique to Chinese joint ventures, particularly those with government-owned entities.

In my career, I've had to deal with three of these beasts (joint ventures with government-owned entities), and the experience was consistent across all three. My primary observations are as follows:

Government entities tend to focus on big, showcase events, not getting the day-to-day job done. This means attention is on signing deals, making announcements, and attracting attention, not necessarily on making things work.
Every time I've counted on the Chinese partner to be responsible for some aspect of a Joint Venture (sales, market development, hiring, etc.,) I've been disappointed. My conclusion: You will own 100% of the day-to-day operations of the JV, no matter what the partner commits to during negotiations.
Partners can get in the way of making decisions, particularly if those decisions include any element of "retrenching." These types of moves tend to result in a loss of face, and are often strongly opposed.
Your technical know-how is not safe. It probably isn't safe with wholly-owned Chinese entities, either, but experiences seem to be worse where partners are involved.

I recall the high point of one of my Chinese joint ventures being the day we signed the contract. I found myself in a hotel lobby filled with TV cameras and reporters as we announced our new company and discussed our goals. Unfortunately, things went downhill from there. As implementation of the joint venture rolled forward, it was hard to get anyone in our partner's organization to pay attention to the project (outside of quarterly board meetings, which were exercises in form over function.) Responsibilities assigned to the partner were left undone -- in this case, the development of a sales organization -- and we had to step in and try to piece things together. Over the long haul this had a very detrimental impact on the project's development, and ultimately led to a shutdown.

Another joint venture languished because we assigned the recruitment of key employees to the partner. The joint venture organization ended up staffed by hacks and pals of senior managers of the Chinese government-controlled partner. Ultimately, we had to step in and replace most of those employees, significantly delaying the early phases of the project and stunting its growth.

It is typical to have expectations for Chinese Joint Ventures that, when confronted with reality, require adjustments. In one JV, the partner became stuck on the idea that we needed an elaborate office building to gain sales -- this despite the fact that customers never visited our offices. I found myself fighting a long battle with the partner, attempting to conserve cash to cover operating expenses as we tried to build sales, rather than spending it all on a building. When I finally gave in, the building was contracted to friends of the Chinese partner's senior employees, and it was significantly over budget and was poorly constructed.

While I've never personally had technology stolen, I've heard countless stories of those who have. In one particularly extreme example, a JV had a competitor literally open up a few blocks down the road, and was staffed by several former JV and Partner employees, ones that had worked key jobs. The money behind that project? A governmental entity from a different "department." It was hard to believe the entire thing hadn't somehow been coordinated behind the scenes.

Based on my uniformly bad experiences with Chinese Joint Ventures, I recommend when considering one, just don't do it! Since you're likely to find yourself doing all the work, anyway, there is little sense in subjecting yourself to the risks and frustrations of a government-owned partner. 20.1

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for $2.99, as are various eVersions of LEVERAGE.

To the right is the cover for DELIVERABLES. This novel features a senior manager approached by government officials to spy on his employer, complete with a story about how a "deal" they are negotiating might put critical technical secrets into the hands of enemies of the United States. Of course, everything is not exactly as it seems....

My novels are based on extensions of 27 years of personal experiences as a senior manager in public corporations.

Non-Fiction: NAVIGATING CORPORATE POLITICS

The Audacity of Thieves

I've often been shocked by the brazenness, creativity, and risk-taking of corporate thieves. Having encountered people stealing from the company on numerous occasions, I am reminded of the words of wisdom delivered once by a police sergeant. He said the common element linking corporate criminals was "opportunity." To put an old saying on it's head, "where there is a way, there's a will."

For the manager, the bottom line is -- if you suspect an employee stealing, if you're suspicious an employee might steal, if you can envision a method that an employee may use to steal, or if you have questions about an employee's character -- check for evidence of theft early and often.

And just to get you started, here are six real world examples of instances where I learned an employee had been stealing from my employer.

1. Expense reports. In this incident, a senior executive (of a level far above what I would have normally expected) was padding his expense reports. The problem came to light when he failed to produce a receipt for a hotel room, one where he had supposedly paid cash. He later confessed that he had stayed with a friend, and had simply had a "memory lapse." Investigations into past expense reports showed that he had been falsifying them for months, perhaps years. When confronted, he referenced an incident several years earlier, when he'd received, in his opinion, a substandard raise. Ironically, the amount stolen was less than a percent or two of his salary -- penny wise, pound foolish.

2. Family Ties. At a small, remote operation site, I had a husband and wife team working for me. The husband was in sales, and had a company-issued truck. The wife was our office manager, responsible for, among other things, petty cash. During an audit, we discovered that she had been dispersing cash to her husband daily for "car washes" and duly noting the expenditures in her account book. The only problem was, the truck was not actually being washed. Once again, the amount of the theft was relatively small, and ended up destroying both their careers once uncovered.

3. Physical Theft. This example came from early in my career. At this particular employer, we used forty pound bricks of solder to make one of our products. Every time we did a physical inventory, however, it seemed like we were using more solder than should have been necessary. But who would steal something like solder? Right? As it turned out, security one day found a set of narrow tire tracks running through the snow. The "vehicle" leaving the plant and going out to the back fence, then later returning. As it turned out, a maintenance person was loading up solder a dozen bricks at a time on a three-wheeled bicycle, and riding out to the fence. He would throw the solder over, and collect it in his car after work. That just goes to show you that no theft is too small, and no stolen item's value is too low, to escape targeting by a determined thief.

4. Making a "loan" to himself. In one of the most outrageous examples of theft, a trusted subordinate managed to make a "personal loan" (in excess of twenty thousand dollars) to himself less than a week before quitting to start a competing business. Under threat of prosecution, the thief did sign a promissory note admitting his responsibility to "repay" the money. When his business ultimately failed, however, no remittance was forthcoming.

5. Helped himself to a raise. I've blogged on this incident before, where a new hire in the HR area forged the documents needed to give himself a substantial raise. If it hadn't been for a suspicious corporate employee, this likely would have slipped through the cracks. While the thief never admitted to his crime, it later came to light that he felt he'd done a poor job negotiating his starting salary. Guess he was just planning to "even things up."

6. Creativity counts. In possibly the most complicated case I've ever heard of, a customer service employee created a scheme where she had customers, particularly those who were identified as "cash in advance" accounts, send their payment directly to her. She deposited these payments in her personal bank account, and through a complex sequence of actions, ended up cancelling the orders after goods had been shipped and successfully hiding the ensuing discrepancies. She was eventually caught after failing to intercept a credit memo, which one of these customers attempted to use (and to which he was not entitled, I might add).

By analyzing these six examples, there are several general conclusions I can make about corporate thieves.

Thieves can be found at any level within the organization, male and female.
They usually act alone.
Many rationalize their actions through some "entitlement" argument -- in other words, they feel entitled to what they steal because of some earlier slight, real or imagined.
Most of the schemes are clever, and some were extremely difficult to uncover. Most were discovered only after multiple thefts.
Diligent employees checking out odd discrepancies were the main way this schemes came to light.
Security, checks and balances, and other methods to prevent theft are only speed bumps. If an employee is determined to steal, they will likely find a way. There is no point, however, in making it easy for them.

I'm sure that for every thief my organization caught, many more got away with it. When protecting your organization against theft, there is no substitute for diligent observation and persistence in checking out anomalies. Even then, you probably won't stop all of it. 19.6

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for $2.99, as are various eVersions of LEVERAGE.

Heir Apparent is the second novel in the Joel Smith Series.  Deliverables precedes it. — Heir Apparent is the second novel in the Joel Smith Series. Deliverables precedes it.

To the right is the cover for HEIR APPARENT. In this tale, someone is killing corporate leaders in Kansas City. But whom? The police and FBI pursue a "serial killer" theory, leaving Joel Smith and Evangelina Sikes to examine other motives. As the pair zero in on the perpetrator, they put their own lives at risk. There are multiple suspects and enough clues for the reader to identify the killer in this classic whodunnit set in a corporate crucible.

My novels are based on extensions of 27 years of personal experience as a senior manager in public corporations.

Non-Fiction: NAVIGATING CORPORATE POLITICS

You Might Need a Witness

Often having witnesses to emotionally charged conversations with superiors, peers, or subordinates is a mistake, but when the stakes are extremely high, it is a piece of insurance that you might not want to forego.

One time it is virtually always wise to have a witness, for example, is when you're delivering a termination.

Job terminations are stressful for both the "firee" and the "firer." Emotions run high on both sides -- anger, desperation, depression on one hand, guilt, anxiety, and sympathy on the other -- and because of the charged atmosphere it is easy for the conversation to get out of hand. I've found this to be true even when a termination is fully justified by misconduct on the part of the employee, and doubly so when the cause is simply an economic contraction.

The presence of a witness tends to anchor the emotions of the person delivering the termination. A credible witness is an objective third party that is present physically in the room with you. That person can give you a nudge if you start to drift off of your planned script for the event (and you should have a planned script -- preferably with written notes -- for reasons that will shortly become apparent). I've found the presence of a real human being to be much more effective in tempering my words and emotions than a tape recorder, or even a video camera. Live people provide feedback, even if it is subtle, that a piece of electronics simply can't match.

Thinking back to a termination I conducted long ago, the employee pushed me hard for a "reason" for the decision to let him go. I was younger and less experienced at that time, and was tempted to give him what he asked for -- the reasoning and rationale behind my conclusion. (As a footnote, bear in mind that there is absolutely no answer you can provide to this question that will help you, and there will likely be several things you might say that can get you in trouble.)

At that time I was in a right to work state, which meant that as long as there was no prohibited reason for the termination (such as an illegal, discriminatory one), continuing employment was at will, and I had absolutely no obligation to offer any reasons whatsoever. Yet I was tempted to provide my rationale for the termination which I felt justified my decision. Objectively, I realized this might provide fodder for a future lawsuit, and providing my reasoning certainly wasn't going to help me, but I still felt a strong emotional pull to do so. The presence of a witness, in this case the HR director, helped me keep my thoughts to myself.

Perhaps an even more important reason to have a witness present, however, is that a witness remembers what was said and what wasn't. Sometimes the recipient of the termination action is "listening" for soundbites they might be able to use later, often out of context, and frequently in a lawsuit. I've seen this happen more than once, and in a cruel twist, the strategy seems to work best on the sympathetic supervisor who is forced into performing an action they both hate and regret. When an opportunistic employee meets an empathetic boss, there is a good chance the manager will be lured into saying something that will later come back to bite them.

And sometimes, even if there is no fire, there can still be some fabricated smoke. On several occasions, I've been aware of terminated employees that outright lied about what was said during their firing.

A witness can protect you in both of these situations. The witness can testify about the state of mind of both parties, the context of the meeting, and the exact meaning of what was said during the proceedings. The witness will have a level of objectivity that neither individual involved in the situation can possibly claim. A witness provides a level of credibility and interpretation that is beyond even a recording. In short, a witness can be your "secret weapon" if you are later accused of something that just plain didn't happen.

I once had an employee claim I treated him "cruelly and unprofessionally" over a joke that lasted a total of ten seconds. Of course, this claim came to light many months later, shortly after his termination. Fortunately, I had a witness that could describe exactly what had happened, the context, and the severity of the situation. This countered the over-exaggerated picture the plaintiff was trying to paint. While the encounter was still damaging, in the bigger scheme of things the witness kept it in the proper perspective, neutralizing some of the of the potential damage.

Having a witness in that situation was just luck. However, in the next incident, the witness was present by design.

In this situation, an employee claimed that one of my managers said he was fired because he was "too old." Besides running completely against all our training, and being totally out of character for the manager in question, there was a witness that confirmed the manager's account of the termination. After investigating the situation, I was convinced the comment was a fabrication. Based on the strength of the witness's account, the complaint was eventually dropped.

While I've previously counseled managers to keep their most emotionally charged conversations private, when it comes to the highest stakes situations it is worthwhile to spend a few minutes thinking about whether having a witness present will work to your advantage. Bear in mind that your opponent may exaggerate, take comments out of context, or outright lie about what you said. If you believe any of these scenarios are remotely possible, and if the consequences of such a claim are dire, having a witness in your corner may be a very smart move. 19.5

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for $2.99, as are various eVersions of LEVERAGE.

Deliverables is a perfect "how to" for spying on your employer.

To the right is the cover for DELIVERABLES. This novel features a senior manager approached by government officials to spy on his employer, complete with a story about how a "deal" they are negotiating might put critical technical secrets into the hands of enemies of the United States. Of course, everything is not exactly as it seems....

My novels are based on extensions of 27 years of personal experiences as a senior manager in public corporations.

Non-Fiction: NAVIGATING CORPORATE POLITICS

Hope for Innocence, Expect Duplicity

Some managers are suspicious by nature. They constantly suspect the motives of peers, superiors, and even subordinates in the organization. These managers tend to operate under the maxim: "Most people will lie, cheat, and steal if they think they can get away with it."

Other managers are a bit like Pollyanna, overly optimistic about everyone they meet. They tend to interpret every statement and action in as positive a light as possible, often forgiving suspect or even bad behaviors, and giving their perpetrators multiple chances to prove they are really good people.

Of course, most real managers fall somewhere in between. But what they don't tend to do is vacillate. Once you read a manager's basic tenancy along this dimension, you can bet that behavior pattern will similarly play out over and over again. By examining the extremes, we can draw some conclusions about where it might be best to try to place oneself along the spectrum.

The advantages to being suspicious include: rarely being surprised by the self-serving behavior of others, being attuned to the darker and more devious political games played in the organization, and being quicker to recognize a person who is wrong for a job or in the wrong job.

The primary disadvantage is a grim and gloomy disposition that tends toward the negative. The suspicious manager tends to bring his/her closest associates down, and may even appear paranoid on occasion (although a wise mentor of mine was fond of quipping that "...just because a manager is paranoid, doesn't mean he has no enemies.")

The main advantages accruing to the optimistic manager focus on the positive work environment the tend to foster. Disadvantages include being tricked or blindsided by predatory employees (subordinates, peers, and superiors), sticking by problem subordinates too long, and sometimes leaving others wondering why the manager is taking "so long" to recognize what they see as obvious.

My personal predisposition is to be overly optimistic. This probably comes from a deep-seated need to have people like and approve of me -- especially those I work closely with. As a result, I am slow to recognize mediocre performers, often developing complicated rationalizations to explain their seemingly strange or incorrect behaviors, rather than recognizing the obvious.

The predisposition makes me subject to the same kind of advantages and disadvantages I described above. But to be a more effective manager, I needed to develop ways of improving my balance between suspicion and optimism. Below are five tactics that I've recognized as having a place in doing just that.

Look for the simple explanation. To avoid rationalizing aberrant behaviors, a manager must begin with the assumption that the most obvious explanation is usually the correct one when it comes to people's motives and capabilities.
Look for triggers. It took many years, but eventually I realized that when I began to suspect someone might not be right for a particular position, my gut was telling me something that my head just hadn't come to grips with. By paying attention to those gut instincts, I have sometimes been able to speed the analytical process.
Think through political implications. My optimistic predisposition exposed me to political gamesmanship. When I realized I was talking myself out of a negative conclusion about someone, I learned I also needed to think about how that conclusion would play politically, and where I might be exposed.
Listen to advice from a suspicious person. I looked for and sought out contrary opinions and points of view. Believing in them and acting on them was sometimes quite difficult.
Act quickly when reaching a conclusion. Given that I was often slow in realizing someone was wrong for a particular role, I couldn't afford to waste time once I reached the conclusion. I learned to try to act as quickly as possible once the conclusion was clear.

I'm sure for managers with a bias toward being suspicious, there are similar rules of thumb that can help them increase their optimism about people they encounter in their work, thus moving them more into balance. Alas, as I don't live there, I can't easily dispense advice for them.

Balancing suspicious and optimistic viewpoints related to the motives of others is critical to the successful manager's navigation of corporate life. Living at either extreme tends to cause problems for the manager that will ultimately limit their effectiveness and their careers. 19.4

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing. Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for a limited time for $2.99.

A Minneapolis tech firm as the setting for murder and espionage?  You betcha! — A Minneapolis tech firm as the setting for murder and espionage? You betcha!

This is the cover of the Audiobook version of LEVERAGE, which I narrated. The story revolves around an offbeat engineer working for Global Guidance Corporation who shows up one night at Mark Carson's house shot and bleeding out. Mark decides to investigate the crime himself, and plenty of complications ensue as he uncovers a wild conspiracy.

My novels are based on extensions of my 27 years of personal experience as a senior manager in public corporations. Most were inspired by real events.

Business Misuse of Email and Other Media

Given numerous high profile instances of celebrities putting themselves in embarrassing or compromising situations through their use of social media, you might think preaching caution to business people would be unnecessary. Yet, on a regular basis I still see emails, Facebook posts, Twitter messages, and video files that range from inappropriate to politically damaging to downright incendiary.

In one instance, I ended up firing an employee because he had downloaded gigabytes of porn onto his work laptop. The situation was discovered when he complained about the slow speed of his computer, and asked someone on the IT staff to take a look at it (there might have been a few viruses mixed in with all that porn). His explanation? He "...only looked at it on his own time." Can you say misuse of company assets and a potential sexual harassment claim? There was no way he could continue on at the company.

In another incident, an email "argument" became highly emotional, involving the trading of threats and insults. One of the participants (the least politically adept) copied half of management after a particularly offensive response from his opponent. While that incident didn't lead to a firing, it damaged the reputations of both participants to the point that their careers stalled.

While I personally haven't been involved situations where materials published on Facebook, Twitter, or other social media led directly to discipline, I have seen it become the subject matter of workplace gossip and speculation. At best, this is an unwelcome distraction, and at worst it can result in turmoil, anger, and even later retribution. The idea that there is a line between your work life and your private life is a myth that you can't afford to believe.

All of these accessible communications can be tossed into the political arena, to be held and used. I've seen threats, blackmail, and even violence result from them. Just recently, I reviewed an email which was uses opportunistically by an employee (out of context, I might add) to try to damage a political rival.

My advise on this subject? Apply the time-tested newspaper rule. If you wouldn't be comfortable seeing what you are writing on the front page of the local newspaper, then don't write it. Same rule goes for posting it, photographing it or videotaping it.

That doesn't mean you shouldn't address issues, handle emotional situations, or even blow off some steam. Just do it in a way that doesn't create potential problems. Written communications, photos, videos, etc, are all easily replicated and copied, and can easily be taken out of context. It is much better to keep such things direct, private, and anonymous.

Exercise caution and mature judgment anytime you create a permanent record of your words or deeds, trying to think through the political implications and how such material could potentially be used against you. 19.3

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing. Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for a limited time for $2.99.

Max Wong, a brilliant engineer at Global Guidance Corporation, extracts a dying promise from coworker Mark Carson to find his killer.  Little does Carson know that pursuing the promise will put his own life in danger. — Max Wong, a brilliant engineer at Global Guidance Corporation, extracts a dying promise from coworker Mark Carson to find his killer. Little does Carson know that pursuing the promise will put his own life in danger.

This is the cover of the Audiobook version of LEVERAGE, which I narrated. The story revolves around an offbeat engineer working for Global Guidance Corporation who shows up one night at Mark Carson's house shot and bleeding out. Mark decides to investigate the crime himself, and plenty of complications ensue as he uncovers a wild conspiracy.

My novels are based on extensions of my 27 years of personal experience as a senior manager in public corporations. Most were inspired by real events.

Schemers scheme, enforcers enforce

I've previously discussed how a portion of any workforce will be tempted to commit crimes based on the presence of opportunity. The point is worth mentioning again, as it was more than just my own observation, coming instead from a police detective that had many years experience with corporate crimes. He said the common element that unites the vast majority of corporate criminals is not poverty, poor pay, anger at management, drug habits, or anything else going on in their particular lives. It is an opportunity to commit the crime undetected. To get away with it.

This same theme runs through my novels. In almost every instance one of the core questions the bad guys ask at some stage is: "Can I get away with it?"

Of course, villains or prospective villains generally think they can, otherwise they wouldn't move forward with their nefarious acts.

Standing in direct opposition to these villains are what I'll call "the enforcers." Enforcers are an important breed in any large organization, and their proactive actions are one of the key things that keep the villains in check. For example, when an employee decides to steal (a tool, for instance) from their employer, it is the enforcers that stand in their way. Such enforcers might be someone entrusted with the specific task, such as a security guard or a supervisor. But in my experience the most effective enforcers, both in catching criminals and in deterring them, are engaged, diligent, and aware employees.

If you're lucky, you have many of these kinds of people in your organization, and if you're unlucky they will be few and far between.

So what makes an enforcer? In my experience it is usually an employee of long standing that feels they are a part of the organization. In the language of current management theories, they are "engaged." They also tend to be of above average intelligence, observant, and also have a strong sense of right and wrong. Yes, they can be the same employees that ask those irritating "fairness" questions at employee meetings.

The enforcer does three things that management has a tough time doing for themselves. They observe the detailed workings of their peers in the organization. They recognize and properly interpret behaviors that are likely to damage the company's interests -- particularly behaviors of a potentially criminal nature. And they are actually willing to do something with this information. It has always shocked me how many employees seem capable of handling the first two aspect of the enforcer's job, but don't take the third step. In my experience it takes a particularly moralistic person, or someone who is extremely tuned into "fairness" to convert observation into action.

While enforcers may be annoying at times, they are critically important to preventing the business from being ripped-off. As a manager, you have to cultivate this group of employees without encouraging them to become ridiculously hair-splitting.

I've relied on enforcers to keep me up to speed on numerous minor violations of the rules -- everything from employees arriving late or leaving early, to minor theft of office supplies, to dirty tricks being played by angry or ambitious executives.

They also were quite helpful in managing bigger problems.

In one instance, I had an HR executive grant himself a "raise" by filling out the paperwork and forging my signature. If that form hadn't passed through the hands of an enforcer, who recognized it as "unusual" and outside of the normal cycle of raises, the theft would have passed through unnoticed. As it turned out, the enforcer brought the suspect raise to the attention of her boss, and that led to discovery of the attempted theft.

In another instance, and enforcer overhead a particularly disengaged employee starting rumors about an executive (in this case, me), and reported his identity. That enforcer's actions created enough doubts in my mind about the employee that I later caught him in the process of stealing confidential information to take with him to a competitor. Without the enforcer's help, this theft probably would have escaped notice.

Enforcers may not be the easiest employees to get along with or to satisfy. But they are necessary to balance those individuals that are willing to rob the company blind when the opportunity presents itself. Cultivate your enforcers and manage them as you would any other asset, because at some point you're going to need them. 19.2

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing. Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for a limited time for $2.99.

Mark Carson discovers danger and deception as he investigates the shooting death of a brilliant engineer working with him at Global Guidance Corporation.

This is the cover of the Audiobook version of LEVERAGE, which I narrated. The story revolves around an offbeat engineer working for Global Guidance Corporation who shows up one night at Mark Carson's house shot and bleeding out. Mark decides to investigate the crime himself, and plenty of complications ensue as he uncovers a wild conspiracy.

My novels are based on extensions of my 27 years of personal experience as a senior manager in public corporations. Most were inspired by real events.

A Little Extra Compensation

Everyone likes to "win" when they negotiate. Despite plenty of advice on working toward "win-win" scenarios, most of us feel better about ourselves if we drive hard for what we wanted, and captured the lion's share of any value on the table.

While this might work fine for most negotiations, I've found it doesn't serve a manager well when it comes to compensation of newly hired employees. Push too hard, and you might win in the short term, but lose overall.

By design, the interview-offer-hire process is generally stacked in the employer's favor. Employers demand to know everything they possibly can about the prospective candidate, particularly items that work to the candidate's disadvantage during the negotiation process. This includes details of past compensation, bonuses, incentive plans, benefits, and the like.

Ostensibly, this information is needed to help the employer put together a "reasonable offer." In practice, it is mostly used to temper the offer the company is about to extend, so that they don't bid any more than is absolutely necessary to get the candidate.

The prospective employee, on the other hand, has virtually no information on the pay practices of the firm. While they might get a general description of bonus or incentive plans, it has been my experience that the "devil is in the details" when it comes to these programs. And the prospective employee certainly has no idea what kind of compensation is being paid to peers, superiors, or subordinates within the firm.

Can you imagine a prospective employee demanding to know what the "other V.P's" take home in salary? They'd be shooting themselves in the foot. Yet having such information might put them on a more equal footing when it comes to any upcoming negotiation on salary.

Fair or not, this is the way our system works.

It shouldn't surprise anyone to learn that when the company uncovers information unfavorable to the prospective employee (related to this compensation question), they use it. Such information might include: current employment status, unfavorable commutes or other logistics considerations in their current job, personal reasons to be tied to a particular geographic area, etc. .

This information is almost always used to justify reducing the offer to be made to the prospective candidate.

Yes, it happens this way every day. Question is: Is it a good idea?

In my experience, a little less aggressiveness by the company goes a long way toward building a solid relationship with the prospective employee.

It's a lesson I learned the hard way.

You have to expect the new employee to eventually figure out your game plan during their hire negotiation. They are undoubtedly smart enough to realize you didn't offer them the opportunity to participate in the stock option plan because they didn't have that at their last employer. They will eventually know you offered them thousands less in salary than their peers because they were unemployed when hired and desperate for a job. They will become aware that their bonus percentage is lower because you could get away with only offering that amount because they were tied to the area by ill parents.

All of these short term "savings" actions are the foundations for long term resentments.

Penny wise, pound foolish.

In possibly the most egregious example I ever experienced, I hired a manager who was suffering with a terribly long commute while working for his current employer. I diligently dug into his salary history, and realized I could certainly hire him for twenty thousand less a year than his predecessor had been paid, and ten thousand less than he was earning in his current job, just so he could get rid of his horrible commute.

I jumped at the chance, feeling particularly clever for getting such a great bargain for the company.

Unfortunately, it only took a few weeks before things started to unravel.

The employee forged a form we used to process raises, giving himself a ten grand increase in pay. While he never admitted to doing this, a short time before the fraudulent document appeared a peer overheard him say that he, "...didn't think he'd negotiated very well."

Of course, he was fired in short order.

Some might say that I dodged a bullet with this hire, a conclusion which certainly has some truth behind it.

But I also learned that I was at least partially responsible for the situation. After all, I created the potential for huge resentment on the part of the new hire by aggressively pushing down his pay. When I looked at others where I had achieved similar "bargains," most of those deals had ultimately resulted in employee problems of some sort such as: latent anger, refusal to accept added responsibilities, or the need for later "economic adjustment" raises to stop them from quitting (although no other outright thefts).

From that day forward, I tried to handle my hires a little differently, following three basic rules:

Price the position, not the candidate.
Assume the candidate will eventually become aware of how they compare to others.
Be willing to spend a little more to buy long term good will.

While following these rules means you spend a little more upfront in some cases, the positive attitudes and motivations inspired by doing so pay dividends by reducing the chances of long term resentments, early defections, or even outright dishonesty. 19.1

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing. Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for a limited time for $2.99.

Need help finding your way through a morass of politics in the workplace?  Navigating Corporate Politics can help. — Need help finding your way through a morass of politics in the workplace? Navigating Corporate Politics can help.

Shown here is the cover of NAVIGATING CORPORATE POLITICS my non-fiction primer on the nature of politics in large corporations, and the management of your career in such an environment.

My novels are based on extensions of my 27 years of personal experience as a senior manager in public corporations. Most were inspired by real events.

Being Friends with Subordinates

Conventional management wisdom warns executives against becoming friends with their subordinates. The primary concerns expressed in this admonition are: (1) causing the appearance of favoritism and, (2) a possible reluctance to discipline friends.

If you can manage these two concerns, there is no reason why you can't become friends -- even best friends -- with some of your subordinates.

Life is too short to spend 50+ hours a week standing aloof from people you actually like!

Let's explore each concern one at a time, and I'll advise you how to manage them.

I've previously blogged on the subject of "fairness" and the perceptions of subordinates. Human beings seem to have a finely-tuned sensitivity to anything they perceive as "unequal" or "unfair," particularly in the behavior of those in positions of authority. This capability is great at identifying unequal treatment, and usually interprets anyone getting anything "better" as example of "unfairness."

I'll argue that under this expectation, every supervisor or manager is going to be seen by at least one person working for them as "unfair." Expectations for "equal treatment" inherent in the perception are virtually impossible to achieve by real human beings. Sometimes being seen as "unfair" is simply unavoidable, and dealing with that perception is a regular part of the manager's task.

Favoritism occurs when the manager consistently seems to provide beneficial, unequal treatment to one subordinate. While being perceived as "unfair" may be inevitable, showing favoritism is not. The trick to avoiding this perception is to "spread around" the "unequal treatment." Make sure when you treat subordinates unequally, everyone at some point gets a share of the benefits.

If you are friends with a particular employee, you won't be able to hide that fact from the balance of your subordinates. People will be particularly attentive to how you treat this friend. To prevent accusations of favoritism, you simply must dole out fewer "unequal benefits" to your friends than you do to the others. You can address this with the friend directly, explaining how important it is for you to be attentive to this issue. You have to expect MORE understanding and "give" friend, than you would an average subordinate. If the employee is truly a friend, they will understand. If not, they are unworthy of your friendship.

In many private companies, a son or daughter of the owner is involved in the business. If there is sensitivity over a friend, it is double for a child. Yet, this relationship doesn't seem to cause problems as long as the owner clearly expects more performance and provides less "unequal benefit" to the child, than from others.

If it can work there, you can make it work for your personal friendships.

On the second point -- offering the difficulty of disciplining (or even firing) a friend as a reason to avoid friendships, doesn't make sense to me based on my personal experiences. I believe this objection is more of a theoretical argument than one born out through examples. I've always had friends among my subordinates, and have never had any issues in disciplining them, or even firing them, when circumstances warrant. In fact, it has often actually made the situation easier on both of us, because it allows me to level with the employee to a degree I wouldn't have felt comfortable doing if I was intentionally keeping distance between us.

In one instance, I had a subordinate-friend who was responsible for a particularly troublesome remote site. He decided to stick by a manager for that site who ultimately failed. Because of my close relationship with my subordinate, I was able to warn him that he was putting his own future on the line by continuing to maintain his confidence in the manager. Yet he stubbornly continued to do so. When ultimately forced to fire the manager, I ended up demoting my subordinate as well. While he wasn't happy about the situation, our ongoing dialog on the subject made the reassignment easier for both of us to manage.

In another instance, I needed to make a decision to reduce headcount in my department by two direct reports. I selected the individuals based solely on who I could do without for the next 6 to 12 months, not on their performance in their jobs. One ended up being a friend, the other was not. The non-friend's termination was pretty normal -- denial, anger, a few threats, with the subordinate ultimately appealing to my boss to try to get the decision reversed. The friend's termination was totally different. I was able to disclose more about my logic and reasons for selecting him (of course, I was careful not to say anything that could be misconstrued as improper). We had a long conversation about the subject, and worked out a way that allowed for an easier transition for the subordinate, and a cleaner hand-off of responsibilities. We parted, still friends, and remain friends even up to this day.

While some of the difference in these two stories relate to differences in the personalities of the subordinates, I still attribute a lot to my tighter relationship with my friend.

There is one instance where I had a friendship backfire -- during a series of evaluations the company was putting all managers through. A subordinate I counted as a friend performed particularly poorly on the evaluation. I explained the situation to him in detail, as well as discussing the implications for his career. Had he not been a friend, I probably would have been a bit more circumspect. That subordinate went directly to the Corporate HR department seeking confirmation of what I'd told him. Unfortunately, he handled it in a ham-handed fashion, and there was some fall out that came back to me -- for being "overly frank" with the employee. I stand by my decision to make the disclosure, but probably should have eased the employee into the implications to his career, rather than being so abrupt. And I knew this particular friend was politically inept, and could have coached his follow-on actions if I had better thought things through.

Go ahead and make friends with some of your subordinates -- life's too short to be holding everyone at work at "arms length" just because you're a manager. But be careful to treat your friends no better (perhaps even a little worse) than other subordinates -- particularly when it comes to those visible items that are often pointed at by people as indications of favoritism. And don't fear that your friendships will make those tough calls even tougher. My personal experiences tell me that it is always easier to work through tough situations with friends than those you've held at a distance. 18.5

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for $2.99, as are various eVersions of LEVERAGE.

CEO Elwood Vilmont disappears into the British Columbia backcountry, kidnapped by criminals  demanding $100 million for his safe return. — CEO Elwood Vilmont disappears into the British Columbia backcountry, kidnapped by criminals demanding $100 million for his safe return.

To the right is the cover of PURSUING OTHER OPPORTUNITIES, a novel I'm currently working on, and hope to release before year end 2013. This novel includes the return of Mark Carson and Cathy Chin from LEVERAGE The pair are on the run from the FBI, hiding at a British Columbia resort specializing in Corporate retreats. When a visiting CEO is kidnapped, the two corporate refugees can't help but become involved.

My novels are based on extensions of 27 years of personal experience as a senior manager in public corporations.

Non-Fiction: NAVIGATING CORPORATE POLITICS

Risk and Reward

Successful career management is largely about properly balancing risks and potential rewards.

The clever, upwardly-mobile manager attempts to limit her exposure to high risk projects (or other responsibilities), and make sure those projects accepted with moderate risk at least have a large potential reward. Successfully doing this requires being able to accurately assess the long-term riskiness of any project up front, and the ability to actually influence where those undesirable projects are ultimately assigned.

Politicians of the "power-player" persuasion (see my article on Power and Politics in the Corporation) take this lesson a step further -- they actively seek ways to thrust risk onto other shoulders, while still keeping all (or at least a substantial portion) of any reward for themselves. They do this through two techniques I'll call "avoidance" and "scapegoating."

Avoidance is similar to the basic technique of the clever manager, but takes it one step further. When a risky responsibility comes up, the clever manager hopes for an opportunity to refuse acceptance. The avoider actually acts proactively to oppose the project, betting that the person in charge is unlikely to hand it to someone who already thinks it will fail. This also puts the avoider in a position to take "credit" if the project does ultimately go down the tubes or significantly under performs.

In one example I recall well, the corporate "hot potato" project was consistently handed to other executives, and not the most "logical" choice because he loudly proclaimed his doubts about the sensibility and workability of the entire undertaking. This allowed him to successfully avoid this particular high risk project for many years. Of course, he ran the risk of being labeled a "negaholic," because of his public opposition, and that designation was tossed his way on occasion. But in the process he did manage to avoid a project that took more than one executive's career down with it. Sure there was a cost, but it was far less than the terminations some of the supporters were faced with.

Scapegoating is actually more insidious, but also more effective than avoiding. The Scapegoater makes sure there is always a "sacrificial lamb" between any high risk project and himself. If the project begins to flounder, the scapegoater can offer up the "lamb" to take responsibility for the failure -- usually an involuntary act on the "lamb's" part, of course. In the worst projects, there may be a series of "lambs" that are slaughtered as the project continues to perform poorly, with the skillful scapegoater carefully maneuvering each into position as a buffer between himself and the growing disaster.

Scapegoating avoids the negative labeling of avoiding, but it does require that at some point, a person be assigned to the project that can actually fix it. Either that, or there is a price to pay when the disaster is ultimately written off -- often blame for not having realized the situation was untenable far earlier in the process.

One master scapegoater I worked with assigned no fewer than five executives to a disaster acquisition he made, each of whom was ultimately fired when they couldn't do the impossible and turn a rotten business into a success. Eventually, the acquisition shrank to the point where it could be folded into a larger business unit, and it effectively became invisible. I'm sure it continues to under perform even to this day, just not in such an obvious venue.

Learning to balance risk and reward, and manipulate events to control one's position along the spectrum, is key to successful career management. Masters in this subject become experts at diverting undesirable projects, and avoiding blame for failures. Making deliberate decisions here is critical to long term success, or in some cases, just to basic career survival. 18.4

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for $2.99, as are various eVersions of LEVERAGE.

Joel Smith returns to solving corporate crimes in this murder mystery, after uncovering the motives behind the corporate spies in "Deliverables."

To the right is the cover for HEIR APPARENT. In this tale, someone is killing corporate leaders in Kansas City. But whom? The police and FBI pursue a "serial killer" theory, leaving Joel Smith and Evangelina Sikes to examine other motives. As the pair zero in on the perpetrator, they put their own lives at risk. There are multiple suspects and enough clues for the reader to identify the killer in this classic whodunnit set in a corporate crucible.

My novels are based on extensions of 27 years of personal experience as a senior manager in public corporations.

Non-Fiction: NAVIGATING CORPORATE POLITICS

Asking for Forgiveness

"It is often better to ask for forgiveness than permission."

These words are spoken thousands of times every day in the corporate world, and the underlying truth embedded in this statement is evident to most corporate veterans -- that rules often hamstring employees to the point that the need to go forward with what they know is right outweighs the need to follow procedure. It is the notion that "all will be forgiven," however, that needs to be challenged.

Following this simple rule of thumb comes with additional risks and inherent consequences that are often not recognized by its practitioner. First and foremost among these is completely shouldering responsibility should your project or plan fail.

Early in my career, I fell victim to this particular consequence, by plowing ahead on a project without permission. At the time, I was the primary sales contact with an important customer, and did double-duty by also acting as their engineering/development resource. I'd been particularly irked by the fact that the customer incorporated one of our competitor's products in one of their models, and when the customer's lead engineer commented that he wasn't completely happy with that product's performance, I quickly volunteered to develop improvements for them free of charge.

Of course, I didn't really have the authority to make that commitment. But since I was technically volunteering my own time, I just did it anyway.

Once back home, I poured hours into a series of product modifications that eventually did manage to provide marginal improvement to the competitor's product. But in the process, I wasted dozens, perhaps hundreds, of hours. And in the end, my customer didn't even incorporate the improvements in the product because of the additional costs.

Of course, our commercial manager found out about the whole thing, and complained. He would have preferred for me to spend my time working on a new design for a new potential customer. My boss gave me a thorough dressing down for superseding my authority, and wasting the company's resources (mainly my own time). Although I "asked for forgiveness" my behavior was not forgotten when my next review came up.

Another way you might fall afoul of this simplistic rubric is by technically violating a rule, and thus exposing yourself to political power plays by you corporate enemies.

While I managed to evade paying the ultimate price, I definitely had a close encounter with this tye much later in my career. In that situation, I received a call late in the evening to discuss a "deal" one of my subordinates had been charged with arranging. Without going into gory details, the subordinate had been negotiating with a very difficult distributor over changes to his agreement that would be unfavorable in the extreme. Now, after days of tense discussions, he had a deal -- all I needed to do was approve it.

The problem was that the price tag for the agreement was well beyond of my level of authority. Technically, I would need to call my boss at home, explain the situation to him, and secure his approval. But I was pretty sure he wouldn't provide it -- at least not without endless reviews and demands to again renegotiate, which would likely have put us back at ground zero. So I instead passed along my approval to my subordinate, figuring I could tidy things up after the fact.

Big mistake. I'd violated the company's rules defining delegation of authority, and I was subject to discipline -- up to and including my termination. At that point, all it would have taken was for a powerful political enemy to campaign for my ouster, and it would have been a done deal. I would have been summarily fired.

So just beware of " asking for forgiveness rather than permission." When you take this step, you're assuming a much higher than normal risk, and exposing yourself to an even bigger than usual penalty for failure. 18.3

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for $2.99, as are various eVersions of LEVERAGE.

When faced with apparent wrong-doing by your employer, and interested government agents, what would YOU do?

To the right is the cover for DELIVERABLES. This novel features a senior manager approached by government officials to spy on his employer, complete with a story about how a "deal" they are negotiating might put critical technical secrets into the hands of enemies of the United States. Of course, everything is not exactly as it seems....

My novels are based on extensions of 27 years of personal experiences as a senior manager in public corporations.

Non-Fiction: NAVIGATING CORPORATE POLITICS

Carrying a Heavy Burden

"Fred doesn't seem like a good fit for his job."

I always dreaded hearing those words from my boss, or any of several variants that included phrases like: "bad choice," "wrong experience," "mediocre performing," and "wrong skills."

The phrase usually signaled the beginning of a battle, a battle over that particular employee's future. This was because the comment was a signal that my boss felt I should take action (usually he wanted me to transfer, fire, or demote) with the particular employee.

And, invariably, I almost always disagreed with his assessment. Which, almost always, led to resistance through argument, foot-dragging, or political infighting.

What I eventually learned, however, is that by resisting his demands, I was taking the performance of the subordinate in question onto my own shoulders, making the subordinate's performance effectively my own.

And that could be a heavy burden, indeed.

An easier, lower risk plan would have been to simply take whatever action my boss was hinting (or outright saying) I should take. Fire Fred. Demote Diana, Transfer Ted. It was what he wanted me to do. And, tactically, it would have given me the opportunity to say "I told you so" in the future, should anything go off track as a result.

Although the benefits of following this course of action were plainly obvious to me at the time, in most cases I simply didn't comply.

This was because I almost always disagreed with my boss's assessment of the employee. I didn't feel he or she should bear the brunt of the whims of a high level executive who "didn't see" what was really happening. It wasn't right. It wasn't fair.

This wasn't because I thought my boss was stupid. In fact, he was one of the brighter people I've known. It was simply that he was far away from the day-to-day dynamics in my domain, and I thought his observations were...wrong.

Fred might not be a good fit in one respect, but his goal orientation was holding the rest of my team together. Diana might not have all the classical skills for her assignment, but she had others that brought a new perspective to the position and were producing results. Ted might not have the experience of another candidate, but he had tremendous drive and inspired his subordinates to excel.

Every time I resisted, however, I was giving my boss reason to doubt my judgment. I was, in effect, taking on the performance of the subordinate in question as my own. If Fred failed, I failed.

But I usually had the advantage. I was usually right. Because I was much closer to the action. Because I understood the employee in the context of the group where they worked. Because I knew how their subordinates responded to them.

Until the time I was wrong.

Larry, like other subordinates under fire, was being scrutinized closely by my boss. He put his faith in one of his subordinates who was failing in his job. In that case, I suggested he consider replacing the person, but he resisted (much as I was doing when my boss pressured me to remove Larry). But the subordinate hid performance issues, and ultimately cratered. Soon afterward Larry fired another of his subordinates, and additional huge problems came to light.

It was too much, too fast. While Larry had some incredible skills, he'd made too many mistakes in a short time. Especially when he was under a microscope.

He and I both got the ax on the same day.

So just remember, when you stubbornly resist taking the personnel action your boss is hinting at (or demanding), you're shouldering the burden of that person yourself -- sometimes with heavy consequences for your own future. 18.2

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for a limited time for $2.99.

Julia McCoy smells a rat, but maybe she should have waited until she was back in the U.S. to say so...

To the right is the cover for INCENTIVIZE. This novel is about a U.S. based mining company, and criminal activity that the protagonist (a woman by the name of Julia McCoy) uncovers at the firm's Ethiopian subsidiary. Her discover sets in motion a series of events that include, kidnapping, murder and terrorism in the Horn of Africa.

My novels are based on extensions of 27 years of personal experiences as a senior manager in public corporations.

Non-Fiction: NAVIGATING CORPORATE POLITICS

Home Sweet Home

When recruiting, some jobs merit regional, national, or even international searches, while other do not. Typically rare skills or critical positions are the ones where you go outside the local market.

But when your favored candidate doesn't make the commitment to permanently relocate, you should keep on searching.

As a hiring manager, you're making commitments to the candidate. You'll invest in the candidate in the form of training and acclimatization. You take the risk that the candidate may not be what they say they are -- in their words, and on their resume. You stop your ongoing recruitment process as opposed to continuing to look at and evaluate other candidates.

In return, the candidate owes you and the company commitments, one of which should be the willingness to permanently relocate to the community where the job is.

Don't get suckered into compromising on this.

"I'll commute for a while, and then look for a house." Translation: "I'll test the waters on this job, and if I don't like it, I won't have disrupted my family's life."

"I'm used to a 90 minute commute." Translation: "I'll put up with a 90 minute commute until I can find a job closer to home."

"I'll fly back and forth until my old house sells." Translation: "I'll commit to move, IF my old house sells."

"Can't I work part time from home?" Translation: "I'll be trying to increase the amount of time I'm not in the office, and this is a good starting spot."

As a footnote, I hate the "working from home" trend. I currently work from home, and can tell you with certainty that my productivity is nowhere close to what it would be in an office environment. And fortunately my writing career doesn't require a lot of interaction and relationship building with other employees, otherwise how would that ever happen?With the exception of a few rare sets of circumstances, I've not seen "work from home" arrangements benefit the company. As a result, my answer on this proposal has always been a emphatic "no."

If you do compromise and hire an employee that doesn't commit to relocate, you will eventually lose him or her. It's happened to me every time.

It might take three months or three years, but eventually the employee will leave. This is because the initial lack of commitment tells you that the employee has doubts. Maybe they're continuing to look for a job that pays more, is closer to "home," fits their interests better, or whatever. The point is, eventually they will find that job and leave the one you're offering them.

I once hired an employee with a 90 minute commute. Despite his assurances that he was "used to it," he only lasted six months. Not surprisingly, his new job was only ten minutes from his home. The position I hired him for required considerable training and development, and at the six month mark, he was just starting to have an impact. I basically lost that six months, plus another couple getting the recruiting wheels going again. Lesson learned.

In another instance, I had a hire move to the job, but into an apartment. She decided to keep her house in another state and rent it out -- to her adult daughter. Her spouse made the move initially, but when some problems developed "back home," the spouse returned. It was just a matter of time after that before we lost the employee. While that time frame was several years, and I did think on balance it was still a good move to hire the woman, I should have seen the warning signs long before I did.

Quid pro quo. You make a commitment of time and resources when you make a critical hire, and it's not unreasonable for you to expect the hire to commit to permanently relocating to your place of business in return. 18.1

Other Recent Posts:

If you are intrigued by the ideas presented in my blog posts, check out some of my other writing.

Novels: LEVERAGE, INCENTIVIZE, DELIVERABLES and now HEIR APPARENT (published 3/2/2013) -- note, the Kindle version of DELIVERABLES (a prequel to HEIR APPARENT) is on sale for a limited time for $2.99.

Julia McCoy struggles to survive in the midst of a deadly corporate theft scheme.  Read by the Author. — Julia McCoy struggles to survive in the midst of a deadly corporate theft scheme. Read by the Author.

To the right is the cover of the audio version of INCENTIVIZE. This novel takes the reader on a trip through some of the most remote areas of the volatile Horn of Africa, as the story follows EthioCupro's attempt to get rid of a pesky auditor -- permanently.

These novels are all based on extensions of my experience as a senior manager in the world of public corporations.

Non-Fiction: NAVIGATING CORPORATE POLITICS

Root Causes

Most of us are familiar with Root Cause Analysis, sometimes known as "the five whys." If you aren't familiar with the technique, it is definitely worth learning as it can be used to figure out the underlying causes and effects involving systemic failures of physical objects or processes.

I've also found the technique quite useful in analyzing political behavior. By digging into the underlying cause and effect relationships between the actions taken by allies or enemies, and their impacts, you can discern a great deal about the political environment, and where people stand on particular power plays or hotly debated issues. In high stakes games, it can even give you an insight into what may happen if you press a particular issue or person.

Political Root Cause Analysis is most useful when applied to a seemingly mystifying situation. For example: Why did Sally turn on me when I needed her support on my proposal for project "X?" There may be several possible explanations for this -- perhaps Sally decided pandering to another manager's agenda was more valuable than supporting yours, perhaps Sally truly believes project "X" to be a bad idea, perhaps Sally has been working to gain your trust all along for the express purpose of undermining you on this project (the kind of thing a power player might do).

These possibilities must each be examined by itself, looking for both supporting and contradicting evidence. Ultimately, you must make a judgement as to why Sally acted the way she did. In some cases, you may also need to test certain aspects of your theory by either talking to others, or even setting a "trap" to see how Sally behaves under a controlled set of circumstances.

One possibility you can't afford to ignore for anyone in almost any politically charged situation is -- perhaps Sally doesn't have a clue as to what is actually happening at the political level. Just don't be too quick to settle on this explanation as it quickly ascribes innocence to actions that may be more sinister in nature.

Let's suppose Sally simply believed project "X" is a bad idea. Then you take the next step in root cause analysis -- asking why she believed this to be the case. Maybe you failed to sell her on the benefits. Or maybe someone else sold her on the risks to her interests. It might be that she has a particular insight into how project "X" might fail. Or maybe she's right.

Settle on an explanation, and then repeat the process again. Do this until you reach either an immovable object -- a basic principle or premise of the organization -- or something that you could have handled differently that would have changed the outcome. Then you have your root cause, the basic thing that caused the situation to unfold as it did. In the process, you will also gain much better understanding of the politics surrounding the event/issue.

Sometimes I've been pretty skilled at employing this technique, while other times I wished I'd done better.

In one example, I confided my displeasure in a decision my boss had made (actually, in this case he "unmade" one that was already well behind us) to a peer. Trouble was, the peer betrayed my trust and repeated my diatribe to the boss a short time later. Why did he do that? Because I hadn't established our relationship sufficiently for him to think he was giving up anything of value by betraying me. Why had that happened? Because he saw me as a competitor for the boss's job. Why did he see me that way? He had been told that by both the boss and a board member.

If I'd reasoned this out ahead of time, I would have easily seen I was heading for trouble with this conversation and avoided it altogether. When I worked through the causes and effects after the fact, I knew that I couldn't trust this peer again under any circumstances.

In another example, I was in a battle with a peer over the pricing of interdivisional sales. In this case, I was able to ask the "why's" necessary to see exactly how I needed to set things up to win. Why was he demanding a price increase? Because he felt like he'd been unjustly forced into a sweetheart deal by his former boss. Why was he forced into the deal? Because that was what the boss had wanted, and he overrode my peer's objections. Why didn't he take this to his new boss? The new boss hated conflict, and would have simply dodged the issue. Why did the new boss hate conflict? Unknown (an immovable object), but it was a clear fact.

By reasoning through the situation, I was able to figure out that I could win the contest if either my opponent was the one to demand arbitration by our mutual (new) boss, or if he appeared so unreasonable in his behavior that it was easy to side against him. I choose to work the latter approach, practically inviting my opponent to make an ass of himself in a series of emails on the subject. Predictably, our boss delegated the decision to another executive, who sided with me once all the "evidence" was out.

While a little trickier to employ to political situations, root cause analysis can be a useful tool to both understand motivations of political opponents, and once understood, predict how they will act. Take the time to be thorough and make sure you get it right, particularly when the stakes are high. 17.3

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Non-Fiction: NAVIGATING CORPORATE POLITICS

Mark Carson is a runner -- away from his marriage, his problems, his career.  In Leverage, we see if he can run away from murder. — Mark Carson is a runner -- away from his marriage, his problems, his career. In Leverage, we see if he can run away from murder.

To the right is the cover of LEVERAGE. This novel explores the theft of sensitive DOD designs from a Minneapolis Tech Company, and the dangers associated with digging too deeply into the surrounding mystery.

My novels are based on extensions of my 27 years of personal experience as a senior manager in public corporations. Most were inspired by real events.

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