Newsletter No. 21 December 2011

We have been silent for far too long. There is a good reason: we have been very busy renewing LASA to concentrate on building lasting success in the future. We are really excited to share the changes we have made.

In fact, we have decided that this will be the last Newsletter in this form; we will be moving to a blog format which will be shorter, available more widely, updated regularly and interactive.

You can meet the new team, find out how we work with our clients, and keep up to date with LASA on our updated website at www.lasa-insight.com. Please have a look and let us know what you think. We welcome feedback and dialogue. And, as always, if there is a subject you would like us to explore, please let us know.

In this issue:

Best wishes from the LASA Team

 

Thought Piece

Last week I attended a debate to launch a colleague’s new book1 . The topic for debate was “Could better corporate governance have saved the News of the World?” Afterwards a vote was held and the argument against won the day. In other words, it wasn’t just that that the rules for governance didn’t work, it was that they could not - in their present form - work and that we needed to start with a fresh slate.

To be fair, the rules we currently have, ought to work if companies were properly responsible and thought about the good of all, but in our current reality they do not. This is largely due to the fact that companies believe that their primary responsibility is to their shareholders and only after that (and in some cases, long after that), to anyone else. This is because today the majority of us – as individuals and in organisations – focus on the short term and instant gratification to the detriment of the longer term and the good of the greater ‘we’.

What do we see today in the world around us? Living in Europe we are acutely aware of the issues in the world of the euro, particularly with Greece and its fast approaching default and fallen government. It is clear that Italy has reached the point of having to face itself and what it is; the government that the people have voted for and its years of unprincipled governance, evidenced by Silvio Berlusconi’s recent resignation and the appointment of a technocrat (as in Greece) to replace him. It will be interesting to see what responsibility the Italian public takes for future decisions and actions. And to consider where Spain and Portugal are in the mix…. And the rest of us? Not to mention that we now have two democratic nations who have an unelected prime minister who was imposed upon them (one way or another) by outsiders (the ECB, IMF, holders of their debt and so on). It is interesting to note that it is not only a nation’s people who can topple their government.

As with the crisis in 2007 (of which this a part), the consequences of our actions should not be surprising – if they had been thought through at the time, most of us would have seen what the outcome would be. And if someone had had the courage to ask to see the emperor’s new clothes, and tried to really understand all the fancy ‘instruments’, had thought through all of the possible consequences of cheap credit… Then we’d have been able to see quite clearly what the outcomes would be: a very short term bubble of growth, in exchange for long term repayment and decline. Few asked what the repercussions would be. And as we are so interconnected today, if one country sneezes, the rest catch a cold. (see book review of Boomerang: the meltdown tour below)

Worlds of uncertainty

So, all sorts of things are happening around us - not least the Arab Spring, the downfall of Gadhafi, the violent unrest in Syria…; uncertainty is rife. The important thing is what are we to do about it? How do we, in our own sphere of uncertainty, navigate our business through it? It’s all change, and change is frightening and painful (as well as energising and challenging), no matter who you are.

It is useful to understand, amidst all this uncertainty, just where you have control and influence and where you do not. The current system isn’t working; the only way it can be fixed is if we all do something about it. To do that we need to get more diversity “into the room” - to enable and make the required changes - than has been the case in the past. We need both/and; change from the bottom, but also from the top. You can’t change someone else, only yourself. You can influence others, you can change your own behaviour, which might, in turn, enable or encourage others to change… and what this all boils down to is personal leadership and making a responsible stand.

Work on those things that you can. And most importantly, take responsibility for your actions and the actions of your business.

Shareholders versus Stakeholders

We think that there is a very small window of perhaps a few years for companies to get their ‘act’ straight. Those who persist in the current paradigm (epitomised by ‘Shareholders first’) will at worst go bust, and at best limp along. It is time for a new motto: ‘Balancing stakeholder needs to enable growth’. This means keeping the long term success of all your stakeholders in mind while you make decisions today for the short term.

Who are your stakeholders? They are those who are affected by things your company does or does not do. Your people, the community in which you work, the environment, your local and national government, your competitors, your suppliers, your clients, and of course, your shareholders. It is about trade-offs, because you can’t please everyone. But you can consider which path you will take and how you will respond to the needs of each of your stakeholders if you will step up to taking on that responsibility. It starts with individual responsibility, but it must move to corporate responsibility. More than just CSR – real, considered thought about what is needed for the good of all, not just for the good of the few.

Achieving the good of all

And how do you do this? Here are some simple suggestions: start a dialogue, a conversation. Model it on Stephen Covey: seek first to understand, then to be understood. Be eternally curious to discover the other party’s point of view. Then work win/win – that will help to uncover the right trade-offs to make. Dare to dream together about different ways to do things, different processes to use or develop.

Whenever there is great inequality, people rise up – just look at what is happening in the Middle East. Inequality is increasing daily and the only people who can do something about it are us. As the famous Pogo quotation says "We have met the enemy and he is us."

The system must change and we believe that it will change. The only question is how quickly will it happen? So: what will YOU do about it? Will you be one of those to sink inexorably beneath the turbulent waves of uncertainty? Or will you adapt to the new paradigm and ride on the crest of them?

1Adrian Davies, “The Globalisation of Corporate Governance.”

@LASA Insight Ltd, 2011

Latest Books

Boomerang: The meltdown tour

By Michael Lewis
Allen Lane an imprint of Penguin Books, 2011.
Pp213

This book came out in October and was mentioned on the Today Programme on Radio 4. It intrigued me, so I got a copy. It is an amusing read, but I am not sure how deep it goes. Michael Lewis talks about Iceland, Greece, Ireland, Germany and the USA (California). There is a fair bit of generalisation – which I don’t particularly like. What I did like was the insight it gave into how different nations got to where they are. There isn’t a one-size-fits-all answer; each nation saw things from a different perspective and did what they did (what he calls going into a dark room with lots of cheap credit available and grabbing what they could get away with) for different reasons. To be more precise: Iceland, Greece, Ireland and the US did this; Germany provided the capital and cheap loans. This is a US/European-centric view however. There is no mention of the BRICs, most particularly of China who holds a lot of US debt. That would have made for an even more interesting read.

Lewis interviews different local people to get their views of what happened, how it happened and then he looks at the national culture to try to explain the outcomes we’ve observed. In all the different countries there were people who saw what was happening and spoke out. In most cases, these people were ignored or pilloried. Certainly no one did anything about it in time.

Now we are faced with the necessary clean-up. When I finished the book, I couldn’t see any answers, rather I felt that the nations in question were not doing enough of what was necessary to ‘fix’ the situation (not that it was clear what this could be). I would have appreciated an understanding, a suggestion of what could be done. The best Lewis comes up with is something along the lines of ‘perhaps we’ll think of something.’

I would also have liked to know where the countries are now – Ireland has, like Iceland, already defaulted. I have an inkling that they are doing some good things, but what? And what not? And what might we learn from all this?

So if you want an entertaining read on how we got here, you will enjoy this, even if it is likely to leave you with more questions that you started out with.

Obliquity

By John Kay
Profile Books Ltd. 2010. 2011
Pp210

I enjoyed reading this book. John Kay’s language is simple and clear and it is based on the premise that goals are often best achieved without intending them. Or, in other words, the best way to achieve your objective is NOT the most direct (at least when the objectives are complex). The first section explores how we find ‘obliquity’ all around us, with some interesting examples.

The second section talks about why we can’t solve problems directly and how oblique problem solving is iterative and adaptive, rather than direct. It is the route of fast prototyping. Try it, test it and adapt it; because as we work on a problem our understanding of it changes.

Finally the third section looks at how we solve problems in a complex world. One of the difficulties we have is in even describing a problem so that it can be solved. We must decide what to put into the description and what to leave out and this in itself will affect how we attempt to solve it. In this section there is even a chapter on Hedgehogs and Foxes! In Kay’s view, the hedgehog moves towards a solution slowly and directly while a fox is quick and oblique. He quotes Tetlock: foxes perform better in terms of the quality of their judgements, but hedgehogs perform better in terms of public acclaim. This is because hedgehogs are people who believe they know the answers while foxes are aware of the limitations of their knowledge. People who claim to be able to predict the future (=Hedgehogs) will always attract more attention than people who know that they cannot do so (=Foxes).

As we become aware that our world is more and more complex, some of these ideas may be useful to help us innovate our way out of the challenges we face. Certainly another way to look at things.

The Tyranny of Choice

By Renata Salecl
Profile Books Ltd. 2010. 2011
Pp184

A short book with an interesting albeit narrow premise; that too much choice makes us anxious and can cause us not to choose OR to choose the tried and tested rather than something new. The idea that we have choice (according to Salecl) burdens us with the idea that we are total masters of our well-being and our direction in life. This is in no way the case, because we are often highly influenced by the society in which we live.

She explains that the main problem with choice is that it is perceived as rational when it is anything but. The fact that we can make choices opens up the possibility for change. Yet, people have become blind to the fact that their actual choices are becoming severely limited by the social divisions in societies. It seems that issues such as the organisation of labour, health and safety and the environment appear to be beyond our choice.

Flame azalea
© PMLustig 2011

Latest News from LASA

  • New ideas for LASA – we are developing products which will enable people to work with the models developed in Beyond Crisis. The first product in the range is Organisational Renewal Cards; these are ideal for use in a team to identify which areas need work in order to achieve renewal. We will keep you informed of other products as they come on stream. Do let us know if you would like to be part of the beta-test.
  • Various articles – Tricia’s article “Why Corporate New Year’s Resolutions Don’t Last” was published in CEO in February (see feature110776). And in the April her article “The Art of Succession Planning” (see trial_issue.pdf) was published in HR Director.
  • Tricia is finishing the second book she has co-authored with Gill Ringland. ‘Here Be Dragons: navigating through uncertain times’ is due to be published by Choir Press in February 2012. This is a book for senior managers helping them on the journey of organisational change. The book is in two parts, starting with a parable (The Columbus Project) about a fictional business faced with uncertainty and change and how it learned to renew itself. The second part is a handbook on the selection of tools used. This format allows readers to either go straight to the 'how to' section, or to start with the story, which is a description of what the process could look like “on the ground”.

Quotes

The care of the Earth is our most ancient and most worthy, and after all our most pleasing, responsibility. To cherish what remains of it and to foster its renewal is our only hope.
~ Wendell Berry

Nature often holds up a mirror so we can see more clearly the on-going process of growth, renewal and transformation in our lives.
~ Anon

So long as a person is capable of self-renewal, they are a living being.
~ Henri Frederic Amiel

Inside myself is a place where I live all alone and that is where I renew my springs that never dry up.
~ Pearl S. Buck

A man practices the art of adventure when he breaks the chain of routine and renews his life through reading new books, travelling to new places, making new friends, taking up new hobbies and adopting new viewpoints.
~ Wilfred Peterson

Modern science is fast-moving, and no laboratory can exist for long with a program based on old facilities. Innovation and renewal are required to keep a laboratory on the frontiers of science.
~ Burton Richter

Joke corner

The things children say…

  • ANDREW (age 5) - When it is Christmas it is the baby cheeses birthday.
  • NICOLA (age 7) Mums are for food, dads are for playing and fun.
  • ANGIE (age 10) Most men are brainless so you might have to try more than one to find a live one.
  • JACK (age 3) was watching his Mum breast-feeding his new baby sister... After a while he asked: 'Mum why have you got two? Is one for hot and one for cold milk?'
  • MELANIE (age 5) asked her Granny how old she was.. Granny replied she was so old she didn't remember any more. Melanie said, 'If you don't remember you must look in the back of your panties. Mine say five to six.'
  • BRITTANY (age 4) had an earache and wanted a pain killer. She tried in vain to take the lid off the bottle. Seeing her frustration, her Mum explained it was a child-proof cap and she'd have to open it for her. Eyes wide with wonder, the little girl asked: 'How does it know it's me?'
  • SUSAN (age 4) was drinking juice when she got the hiccups. 'Please don't give me this juice again,' she said, 'It makes my teeth cough….'
  • DJ (age 4) stepped onto the bathroom scale and asked: 'How much do I cost?'

LASA Website

If this interests you, there are other interesting resources on the LASA Insight website so why not take a look by going to www.lasa-insight.com

Comments and Feedback

If you have any comments or feedback on - or suggestions for - this newsletter then please email them to us  here

@Patricia Lustig 2011