The Platinum Rule

Again I learned something new at the McGill MiniBiz Seminar this week. The topic was managing diversity, especially the generational gap between those born before WWII, the Boomers, Gen X and Gen Y.

For both managers of those diverse groups and for members of each generation the recommendation was to remember the Platinum Rule.

OK, we all know the Golden Rule, "Do unto others as you would have them do unto you". Apparently a pretty universal concept that has worked for many generations. Essentially, treat other people the way you would like to be treated. Seems good to me.

But consider the more effective Platinum Rule, especially when there are large cultural or generational differences to consider: "Treat other people the way they would like to be treated." Powerful concept.

Henry Mintzberg is worth listening to

I had the pleasure yesterday of hearing a presentation by Henry Mintzberg, McGill professor and management guru. One attendee described him as the "Tiger Woods of management science".

I know him as the Strategy professor during my McGill MBA program from 35 years ago. (Yikes, neither of us seem to have aged that much! OK, maybe less hair.)

He is a widely respected academic and the acclaimed author of "The Nature of Managerial Work ", "The Rise and Fall of Strategic Planning", "Managers not MBAs" and many other books and articles that argue against the conventional wisdom and provoke thoughtful reflection on management and business. He is also the co-founder of the International Masters Program in Practicing Management (IMPM), a unique approach to learning that is designed to flow from the experience of the participants.

His presentation yesterday was originally advertised to be on the dilemma of corporate compensation, but that turned out be only part of his critique of the modern CEO focus on shareholder value that is leading to the great depression of 2008.

Some of his points to consider:

• Productivity is a euphemism for cutting costs, mostly by firing employees, while maintaining short-term revenues.
• The theoretical corporate objective of maximizing long-term shareholder value has been hijacked to mean pushing short-term earnings to inflate current market share prices.
• How can employees be motivated to work for shareholders they have never met? Many of whom have no interest in the company except for the short-term ability to make a profit on their investment - they are day traders or hedge funds.
• Shareholder value is not a worthy objective of the corporate institution as it specifically ignores (or exploits) other stakeholders, especially employees.
• Mercenary corporate leadership is stealing from shareholders with absurd compensation and severance packages that are not tied to performance. The "robber barons are back!"
• The old corporate silos have been replaced by horizontal slabs of concrete separating executives from their employees and the real operating issues.
• "Human resources" is a term that dehumanizes human beings. It makes it easier to treat people like other "resources" to buy, sell, use and dispose of them. It's like describing airline passengers as "self-loading cargo"!
• Corporations need to remember that customers are people too. They are not just another asset to be exploited.

Professor Mintzberg also suggested some remedies to avoid the great depression of 2008:

• Stop being misled by the apparent productivity gains and profitability of large American corporations.
• Get the mercenaries out of the executive suite and add employee voices in the boardroom.
• Stop running businesses to satisfy financial analysts or investors with no interest in anything except short-term results.
• Install real corporate leadership that is concerned, engaged, and modest. (Interestingly close to Jim Collins description of Level 5 Leadership from "Good to Great".)
• Ignore the obsession with measurable factors and reconsider the immeasurable - values, benefits and impacts of economic activity.
• In the larger context, get back to a better balance of the three sectors in society - public, private and social.

His full commentary is available at How Productivity Killed American Enterprise.

Lots to think about and to influence if we can.

Not worth reading

Seymour Schulich's recent book "Get Smarter" is a disappointment.

In spite of the reviews and promotional news releases that it's full of brilliant insights, it is instead full of clichés and old anecdotes borrowed from Aesop's Fables or father's favourite tales. Not the wisdom and lessons of life and business and that you would expect from a prominent Canadian billionaire.

More a confirmation of the power of money to buy respect and admiration that Mr. Schulich has already demonstrated by his conspicuous donations to Canadian universities. I don't know him, but I have an impression that Mr. Schulich is most impressed with himself and acted on the urge to say "I'm very rich so I must be pretty smart and people should listen to my advice." He offers his opinions on China, the Middle East, and his favourite movies (why is that relevant?) A good friend or editor should have told him not to embarrass himself. He doesn't need the money or the attention from writing a book.

He does have old-fashioned views and strong opinions on some subjects that are both surprising and interesting and the Appendix describing his lucky strike in Nevada is more revealing of how to become a billionaire. Still not enough to justify the price or the time to read the whole book.

A Peter C. Newman story of his life and times would have been more interesting, but probably not as flattering for Mr. Schulich.

Anyone can be an entrepreneur

That was the advice of David Lank, Director of the Dobson Centre for Entrepreneurial Studies at McGill, in a seminar last evening. I agree that anyone can be, but not everyone should be, and not everyone wants to be.

As David suggested, why would anyone want to be an entrepreneur when they know that:

1. You will not really work for yourself, but instead for all the people that depend on you.
2. The world really doesn't care about you or your business.
3. Most new businessses fail.

The first test of a real entrepreneur, of course, is that he/she proceeds with enthusiasm in spite of all that knowledge. In David's opinion, based on providing start-up capital to more than 140 companies during his career in venture capital, the most important element in deciding to invest in an entrepreneur is the passion they demonstrate in support of their plan.

A formal business plan is always required, but that is less important than the passion factor. The most important element required for favourable consideration of the business plan is the understanding of reality communicated by the entrepreneur.

Good perspectives to keep in mind.

Learning entrepreneurship

My next teaching challenge is to present the subject of Entrepreneurship in the Continuing Education program at Concordia University.

Can you really teach entrepreneurship? What if you have to be born that way? What about all those stories about "delivering papers when I was nine years old"...? I didn't, so am I disqualified?

My own theory is that an entrepreneur is simply a creator of businesses to meet an opportunity. Anybody can do it anytime; if they have the marketable skills, relevant knowledge, and determination to succeed.

So what can I teach? Having reviewed a number of textbooks on the subject, I have concluded that the expectation of those signing up for the course is to learn some basic business processes and principles that will help them to evaluate their choices and make the decisions necessary to develop an idea or opportunity into a valid business model and business plan, finance it, start it and make it grow.

Sounds simple.

Leadership

I'm currently reading Stephen Covey's latest - "The 8th Habit"; following of course his best selling "The Seven Habits of Highly Effective People".

On the subject of management and leadership he summarizes the themes and concepts of many other authors. (Give him credit for some humility.) What sticks with me are the stated principles of: 1. Set the direction, 2. set an example, 3. define the values, 4. provide the systems; then let people manage themselves.

My own summary of management has always been simply to communicate the objectives and then remove the obstacles to achieving them. The guiding principles may be simple, it doesn't mean they are easy to follow.