GRADUATION SPEECH, LIMA, PERU, JUNE 2008

Flew down to South America to speak at PUC-Lima's MBA/DBA commencement, and to give a couple of lectures the next day. After the speech (you'll see why, if you can read this), several students asked if I would pose for a photo with their mothers. The speech took off on a letter I wrote to The Economist earlier this year.

Queridos profesores, graduandos, padres de familia, amigos y huespedes distinguidos. Me hace muy feliz de estar aquí con ustedes una tercera vez y de felicitar a otra clase de graduandos y a sus familias.

Les traigo saludos de Maastricht School of Management. Los países en todo el mundo continúan acercándose a MSM sobre las colaboraciónes para los programas de grado, y MSM ha establecido nuevas colaboraciónes este año. Se puede ser orgulloso que su grado es uno que inspira confianza por todo el mundo. Este año MSM ha publicado dos más volúmenes en la serie del libro de textos del MBA que mencioné en la graduación del año pasado. MSM trajo el congreso anual de la Asociación Internacional del Desarrollo de Gerencia a su país vecino, Suriname. Este congreso comienza hoy en Paramaribo y continúa con la semana.

En este podium hace un año, comenté a propósito de la responsabilidad social corporativa, CSR. Ahora quisiera volver a ese asunto, ofreciendo una vista simple del CSR, y observando sus implicaciones para sus carreras, estimados graduandos.

Porque sus padres y madres están presentes esta noche, quiero implicarlos en mi declaración. Me ayudarán a dar vuelta al CSR, un tema que otras personas ven como cuestión compleja y polémica, en un concepto directo y realizable:

Antes de que las corporaciones piensen en hacer el bien, deben parar el hacer el mal. Para efectuar el CSR, los ejecutivos necesitan solamente hacer lo que les dijeron sus madres: Repare sus propios líos, y refrénese de tomar lo que pertenece a la otra gente.

Antes de que las corporaciones piensen en hacer el bien, deben parar el hacer el mal. Cada derramamiento de aceite limpiado en el costo público, cada soborno para destruir una aldea para excavar una mina, decepciona a una madre en alguna parte. (Si Mamacita es economista, ella llama de estos actos los “efectos externos negativos.”)

Antes de que las corporaciones piensen en hacer el bien, deben parar el hacer el mal. El soberano carga una corporación en la expectativa de cierto beneficio social, y en la expectativa que la ley será obedecida. Es hasta la corporación simplemente al honor del este contrato.

Como cualquier buen concepto en ciencia de gerencia (o cualquier ciencia), el principio simple destapa complicaciones. Por ejemplo, los gobiernos son flojos en hacer cumplir los términos de cartas corporativas, y las corporaciones pasan mucho dinero para preservar esa situación.

Otros ejemplos - como la crisis actual de la hipoteca que originó en los Estados Unidos - ilustran que el reto real no es tanto el comportamiento de una compañía individual, pero la relación entre los sectores, por ejemplo, entre el negocio y el gobierno. Esto es, para mí y mis estudiantes, un tema fascinador e importante para la investigación.

Dije que ataría esta discusión a sus carreras. Para ocuparse eficazmente de relaciones entre sectores, es aconsejable trabajar en sectores múltiples. Intente trabajar durante algún tiempo en industria, y entonces en empresas sin fines de lucro. Quizá también para los militares, para la prensa, o para un NGO. La experiencia en sectores múltiples ahora es un requisito frecuente para los situaciones del alto directivo en cualesquiera de ellos.

El consejo adicional de la carrera se encuentra en las declaraciones recientes de dos hombres famosos.

El teórico bien conocido de la estrategia Gary Hamel dijo que las organizaciones del pasado requerían de un empleado inteligencia, obediencia y diligencia - pero (él dijo) podrían conseguir eso de un perro de aguas cocker. Las organizaciones de hoy necesitan que los empleados exhiben creatividad, iniciativa, y pasión.

Arthur C. Clarke, autor famoso de 2001: A Space Odyssey e inventor del satélite de comunicación, murió en marzo de este año, a la edad de 90. La revista The Economist dice que las visiones cósmicas de Arthur C. Clarke le dejaron con poca paciencia para aplicaciones más humildes como las políticas y la economía. Ésos, Clarke escribió, fueron sobre el “poder y el dinero, ni una ni otra cuyo debe ser… la preocupación primaria de hombres maduros.”

Por supuesto como los graduados de MSM y del CENTRUM ustedes han dominado las herramientas del negocio y de políticas, y las utilizarán para alcanzar objetivos moralejas, y quizás incluso cósmicos. Pero ambos caballeros, Sr. Hamel y Sr. Clark, están sugiriendo que los patrones y los empleados necesitan crecer, para hacer seres completamente adultos y sociales, para hacer frente a los desafíos del mundo de hoy.

Sé que sus profesores serán orgullosos como ustedes hacen exactamente esto. Y no olviden: Escuchen a sus madres! Gracias, y otra vez, enhorabuena.

Professor Puts His Body on the Line for Management Education

Or as my sister put it,

“Oh Gawd... Take Dramamine.
P.S. Are you CRAZY????”

I took some students to San Diego's High Tech Night at the Opera earlier this month. At the reception before curtain time, I won the grand prize in a drawing - an aerobatic flight with telecomm entrepreneur and stunt pilot Rory Moore.

Rory founded CommNexus and other companies. His story is here.

The flight was this morning.

I'm still alive, and did not need the airsickness bag. Had a great time, flew the plane a while, white-knuckled it while Rory turned rolls, loops, loops with half rolls, and something called a hammerhead (you don't even want to know what that is).

I wonder whether my two whole minutes of parachute training would have benefited me, had the unthinkable eventuated. Anyway, ‘twas a gorgeous day to fly up the coast past Pacific Beach, La Jolla, and Del Mar. Here’s film taken from Moore’s plane (on another occasion, not by me) as it flew inland.

In Which I Make an Excuse, and Ask a Favor

Sorry for my long absence from this page. My excuse: many travels in April (Newport Beach, Honolulu, Chicago, Palm Desert), a 3-week non-serious but inconvenient illness, and too much work. Still working on the work – was invited on short notice to be commencement speaker and to lecture in Lima, and have become a consulting editor for Elsevier’s Scirus pages. Have had to turn down, for the time being, further invitations to teach in Malaysia and Guatemala.

Cleverly managed to miss only two tango lessons during this period, at the price of infecting my beautiful teacher with the bronchitis. She’s forgiven me.

Meanwhile the world goes on, and leaves no shortage of things for me to comment on. You can help me on two remaining projects, and if you do, I can return sooner to the kind of blogging you expect here.

Project 1: An edited book on entrepreneurship and innovation for MBA students in developing countries. About half the chapters are in hand; I need volunteer authors for the remaining chapters. Email me if interested. Much appreciated.

Project 2: Events ranging from the Exxon Valdez oil spill to today’s mortgage crisis have evidenced not only failures of companies and institutions, but failures or absence of mechanisms for coordination of institutions. What dropped between the cracks of the State of Alaska, Exxon Corp., the Alyeska Corporation, and the feds made the difference between a possible recovery from the disaster and the cleanup that never happened.

Mortgage originators, bundlers and securitizers, investors and regulators constructed a shell game in which no one was accountable and (mixed metaphor coming!) the fox guarded the henhouse.

Enron, Andersen, the SEC and Congress? The Pentagon’s untraceable payments to contractors for unknown deliverables? Further examples aren’t hard to find.

Here’s how you can help, as I write non-blog articles on the topic of inter-institutional relationships in a hyper-connected world:

1. Are accountability and foxes in the henhouse the central issues here? Can you suggest others?

2. What are possible solutions that have to be looked into? Term limits in Congress? Better checks and balances? Still more campaign finance reform? More regulation of corporations? Criminal penalties for creating moral hazard?

Think out of the box and send me the results, which I will acknowledge gratefully in any publications. Thanks.

Authenticity at Work (and Famous Folks, installment #2)

“B,” one of my faculty, whose field is diversity and inclusion in the workplace, gave a seminar the other day. He talked about authenticity – when you are respected and “included” at work, you can be yourself, thus bringing all your abilities to the aid of your team and your task.

Sounds good, and it reminded me of two instances – one that supports B’s idea and one that doesn’t.

In the early 90s at the IC2 Institute, a team gathered to write a follow-up proposal to the Air Force. We decided to sit at a table in the upstairs gallery. As the group trooped through the gallery door, “G,” a woman in the group, was chatting about a sociologist who’d showed that when a business meeting happens at a rectangular table, people tend to sit across from someone they’re sexually attracted to. Lost in her academic mode, our teammate wrapped up this story just as she sat at the table across from E, another fellow in our group. No irony, no embarrassment, she was just oblivious.

A charming lack of self-consciousness on her part, and an interesting demonstration that academics don’t always connect highfalutin’ peer-reviewed research to their own daily lives.

Other team members, however, did notice what she’d done. They stifled giggles, rolled their eyes comically, shot meaningful glances to each other. One, standing behind G, enjoyed a big, silent belly-laugh. E was amused and struggled to contain himself.

This was a group that was willing to communicate on many levels, and felt easy doing so. They were also, apparently, committed to not ridiculing G, a good (and very attractive and very married) colleague who brought great expertise in the area of the proposal.

As we settled down to business, communication flowed freely, leading to an idea and a proposal that won a three million dollar grant from AFOSR.

2nd instance: My daughter Gina was writing a school report on the old bluesmen of Texas. She showed me one of her source books. I noticed an error in the book.

“Gina, these two captions are reversed,” I said. “This photo is Mance Lipscomb, not that one.”

“How do you know?” she reasonably asked.

“I knew Mance Lipscomb.”

“Daddy, you didn’t.”

Ah, but I did. Mance performed at the old Armadillo World Headquarters back around 1971. The man had no flash at all; he just sat in a wooden chair at the front of the stage and played great music. Mance was entirely authentic. He was used to playing on his front porch with friends and visitors, playing a bit, chatting a bit, sipping some lemonade. That style didn’t change when he sat before an audience of hundreds.

In that spirit, I wandered up to the stage to ask him to play a particular song. Well, he said, he knew a version of the song that might not be familiar to me, and he’d got it from a different source than Robert Johnson had, and.… His reply was turning into a lengthy discourse.

I had a ball, standing there conversing with Mance Lipscomb. The four hundred people behind me were getting mighty irritated; they wanted the show to go on.

Authenticity is great, but sometimes we have to adapt to circumstances. How, I wonder (and you might, too), could Lipscomb have continued to show his true self, and at the same time respect the fact that people paid for tickets and expected a “show”?

Encounters with Famous Folks

I'll indulge in this from time to time. Today's entry is sparked by reminiscences of plane flights. On one such, when my kids were small, we sat in the back of a Chicago-Austin flight. The woman across the aisle chatted me up because she was enamored of half-Asian children (like mine). Turns out she was Mari Michener, spouse of the famous writer James Michener. "You must come over for tea," she said. "Give me your phone number."

Weeks went by.

Dena, the wife of a colleague of mine, worked as secretary to James Michener. "Mari always says she's going to invite people to tea," Dena said, "and then she never calls them."

Michener willed his art and documents to the University of Texas. In the UT museum's basement there must be a card with my old phone number on it.

In those days I travelled frequently to Washington D.C. Congressman John Jenrette and his wife Rita had just become notorious for having, um, done it on the steps of the US Capitol. (A DC tour agency, and later a comedy troupe, were named "The Capitol Steps" in honor of the couple. Or the coupling.) Four or five times on Southwest flights out of DC I found myself just a few aisles away from the comely Rita. Never got any work done on those flights. Rita and my fertile imagination kept me thoroughly distracted.

War: Q & A

Another reader query from the archives of The Conscious Manager bears on the war and the election.

Q. Why does war exist, and is war always bad?  Do we fight because it is the right thing to do, like self-defense / prevention of harm?  Or do we fight because we want something out of it, like getting enjoyment from anger and jealousy?  If you had the chance to kill a ruthless dictator that could care less about peace, and you could kill him with one good sniper shot and get a clean getaway and no one knew that you did it, would you do it?  Also, I grow suspicious of people who want peace and then create conflict, not peace, from their actions.  -J

A. J, we're going to dispense with goods and bads, and deal with "ises."  Humans evolved, and evolution doesn't cut us much slack.  If we were constituted differently, we might not have evolved and survived as a species.  So men complaining about war may be like women complaining that men only think about sex; if either thing were different, we might not be here. (I am aware, of course, that those who've died in war aren't here.) 

The two, not surprisingly, are related.  Bonobos, critters that look like chimpanzees, don't have war.  They defuse conflicts by grooming each other and having sex.  There aren't many bonobos left.  Chimps solve conflict by fighting.  Then the winners have sex, that being the "something they get out of it."  One strategy is better for procreation, the other better for protection, and a population needs both procreation and protection.  There aren't many chimps left, either, but that's because of human-caused loss of chimp habitat, and there are (I think) more chimps than bonobos.

Is the same true for humans?  A news article in early 2003 noted that fully 12% of the current human population are direct descendants of Genghis Khan and his siblings.  So historically, young men were motivated to go to war if it represented their only chance to "marry."  Old men preferred to die in "glorious" battle because it beat the alternative, which involved having other people chew their food for them.  That is to say, old age was not a pleasant affair before modern medicine, and some preferred to avoid it.

Today, some youngsters join the armed forces, even when war looms, because it's the only route out of a bad neighborhood and a life of poverty.  (Actually not the only route: Selling drugs gets you out of poverty, affords the same probability of dying young, and you don't have to take orders from no stinkin' sergeants.)  Others are duped into it, believing their elders' bullshit about glory and justice.

Suppose we could only stop a genocide by going to war.  All other things being equal, most people would like to see fewer deaths rather than more.  All other things, though, are almost never equal, and I would tend to suspect decisions based on body-count arithmetic.  In any case, each person must choose his own battles.  We have a volunteer army, but they don't get to vote on where they will fight and where they won't.  It might be worth letting them do that!  Phil Ochs said, "It's always the old who lead us to the war, always the young who fall."  So it's like abortion, which is similarly tragic:  I don't like abortion and I don't like war, but I'm not going to tell women - or men - what they may or may not do with their bodies.

This is a tough one.  I was raised to see preventing further genocides as a duty, and as a young man I was crushed to see the U.S. fail to act on that principle, for instance in Cambodia or Rwanda.  You're a movie fan, J; go see The Killing Fields.  Should future such situations arise, I might well decide to rally others to a rescue mission, knowing violence might result but dedicating myself to miminizing it. In wars of old, non-combatants suffered in serious, but indirect, ways: via famine, rape, pillage.  In today's wars, innocent bystanders are far more likely than before to be killed directly.  This can happen in myriad ways, from mined rice fields to mis-aimed missiles to cross-fires in urban warfare.  I hope young people desiring to go to war will consider the near-inevitability of killing civilians, and think twice and perhaps decide to stay home in Peoria. 

You mention Pearl Harbor, which was a famous failure of U.S. intelligence.  I'll go so far as to say all war is a failure of intelligence, planning, strategy, communication, or preparation.  If a threat is developing against you, you should, just as in aikido, assemble overwhelming force at your opponent's weakest point.  You tell your opponent what you're going to do should he not stand down, and then do it.   This is how a mission should be defined and executed. 

Even military commanders who have mastered intelligence, planning, strategy, communication and preparation get caught by ego.  They escalate force beyond what's needed for the mission, responding to "insults" and stooping to vengeance.  Others don't understand mission at all.  I heard a recent speech by a general, who began, "My job is to kill people."  He could as easily and more accurately have said, "My job is to protect Americans and that may unfortunately involve killing people."  That guy should lose his job before he does any more damage. 

There have been isolated human cultures that, like bonobos, shun war.  When threatened, they have hired mercenaries or allowed deviant insiders to fight on their behalf.  The fighters were then exiled when the conflict ended - if the village survived - so as not to contaminate the peaceful society.  There are, in the modern world, far fewer isolated cultures.  The characteristic, if not the people themselves, may die out. 

So you're right that untrained pacifists may do more harm than good.  Their attitude that violence never settles anything is naive.  As Robert Heinlein noted, violence settled Hitler's hash pretty good.  Work on yourself first, then work for peace!  As an aikidoist, you are peaceable but skilled at forestalling conflict and applying minimum necessary violence.  You position yourself in ways that communicate your strength and your intention, but you never "attack first."  You don't interpose yourself between someone you want to protect and someone attacking her - except at the moment a blow is being struck - because it's unlikely that you understand what's really going on between them.

For the same reason, you would not assassinate even a despotic leader in cold blood.  (Another hypothetical social experiment:  Suppose all international conflicts were customarily settled by assassination.  Leaders would know before running for election that this is what would happen to them if they piss off another country.  This would put a different complexion on politics, n'est ce pas?)  You give everyone every opportunity to fix up their karma, until and unless they launch another attack.  Only then is matching violence indicated - but if you are unprepared for their next attack, shame on you. -FP

Another reader question, on a lighter note, this one from last week. I'd been talking to my friend Jim on the phone, when the doorbell rang.  I answered the door, and told him I'd call him back...

Q. I heard a female voice say, "Are you the man of the house?" and then you hung up on me.  I can't wait until you blog about that...  -Jim

A. Jim, there was a really pretty girl at the door.  She wanted to sell me a gallon jug of organic cleaning gunk for $100.  In fact, she took out a toothbrush and attacked the oil stain under my motorbike, and the grease smears on the bbq grill.  Little did she know that all the stuff I'd left in storage in Oregon four years ago was due to arrive in San Diego the next day... There's now no room in my garage or spare room for a mouse, let alone a gallon jug.  So, I had to disappoint her.

The next day I checked the grill and the bike.  The gunk had dried, leaving the stains pretty much as they had been before.  So, lucky that I had resisted her sales pitch. Which included a low-cut blouse and tiny short-shorts - tactics we tend not to teach in business school. -FP 

Sweet but Crude

Hallelujah, three of the companies we love to hate got their come-uppance this week.  Starbucks has given the boot to T-mobile, and a court has ordered Ryanair to pay thousands to the new Mrs. Sarkozy in compensation for unauthorized use of her image. (The judgment favored Hubby Sarkozy also, but he accepted only one Euro in damages.)

Over the years I’ve written twice to Starbuck’s corporate to complain about T-mobile.  It’s eerie to think about how something one has written may – or may not – have affected the outcome of events.  (I just had a similar experience with Scott Adams of Dilbert fame, which I’ll tell you about on another occasion.)

As Starbucks’ CEO is now trying to turn the company around, both of my epistolary thrusts return to relevance. First, bad wireless service wipes out the consumer loyalty won by good coffee.  Second, don’t ignore the b-school concept of core competence: My credit union, correctly claiming competence in banking but not in brewing, charges checking fees and gives me free coffee. Starbucks is good at coffee, doesn’t know spit about wireless networking, and so should charge for java and not for wireless.

I’ve already talked the VP of one small hotel chain into dumping T-mobile.  (It’s not eerie when you know you’ve influenced events.) Again, the core competence argument: Why use a phone company for Internet service?  If you want to give your guests good service, find a company that specializes in Internet.  Next on my list is the Hyatt chain, which contracts with T-mobile for wireless and doesn’t know how much bad will it’s generating. 

A couple of years ago on the Euroblog I said all I have to say about Ryanair. When you reach the Euroblog page, hit control-F and enter the search term “weeze” (sorry, I neglected to put an anchor there).

Oh yes, I said three companies… Hugo Chavez has cut off Exxon-Mobil’s supply of Venezuelan crude oil. If you’re still mad about the 1989 Exxon-Valdez spill in Alaska (or the fact that the company still hasn't paid cleanup costs) consider that vengeance is sweet… but crude.