Posted on 02/03/2010 9:56:03 AM PST by SeekAndFind
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If you always do as you always did, you will always get what you always got." So goes an old saying. And so goes the American economy.
The problem has become the solution. Americans are now getting from their government what they got from their corporations. The automobile companies are collapsing because of their short-term perspectives and so the government has provided one bailout projected to last a few weeks, and here comes another.
We call this a financial crisis or an economic one, but, at the core, it is a crisis of management. To understand this, consider the mortgage debacle.
How could these mortgages have come to exist in the first place and, worse, how could they have spread to so many of the bluest of blue-chip financial institutions? The answers seem readily apparent. Those who promoted these mortgages were intent on driving up sales as quickly as possible for the benefit of their own bonuses, the ultimate consequences be damned. In fact, they sold off these mortgages as quickly possible.
But how could any serious financial institution have bought this junk - or, more to the point, tolerated a culture of people too lazy or disinterested to realize it was junk? That, too, is simple: These companies were not being managed. They were being "led" - heroically, no doubt - for short-term spectacular performance. The executives didn't know, and the employees didn't care.
What we have here is a monumental failure of management. American management is still revered across much of the globe for what it used to be. Now, a great deal of it is just plain rotten - detached and hubristic. Instead of rolling up their sleeves and getting engaged, too many CEOs sit in their offices and deem: They pronounce targets for others to meet, or else get fired.
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Executive compensation, the most evident manifestation of this legal corruption of management, was labelled scandalous by Fortune magazine more than 20 years ago, and repeatedly ever since, to no avail. While America escalated its love affair with leadership, its corporate leaders singled themselves out for increasingly obscene pay packages, all the while extolling the virtues of teamwork and sustainable enterprise.
Alongside this came all that "downsizing": Fail to make the targets, no matter how profitable the company remained, and out the door went thousands of employees, those "human resources." So conveniently called, in fact, because while managers have to be careful about human beings, they can dispose of human resources like any other resources.
But at what cost? Rather high, because these people carried out much of the critical knowledge of their companies, as well as those companies' hearts and souls. A robust enterprise is a community of human beings, not a collection of human resources.
We have been told how productive the American economy has been. Well, check the way productively is calculated: Firing great numbers of people, and expecting those left behind to carry the load before they burn out, is productive, indeed - until the longer-term consequences show up. They have been partly showing up in the massive U.S. trade deficits. The U.S. economy is collapsing because the American enterprises - and worse still, the country's legendary sense of enterprise - have been collapsing.
To get bailed out yet again, the auto companies have to offer plans. No problem: American companies specialize in making plans. It's the execution that's been the problem. (Remember those grand auto shows, with all their exotic cars that never made it to market? That was "planned obsolescence.") These companies couldn't succeed by doing, so how are they supposed to succeed by planning? The only thing we know for certain is that these plans will result in many more layoffs. That's some way to fix an economy.
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From where I sit, management education appears to be a significant part of this problem. For years, the business schools have been promoting an excessively analytical, detached style of management that has been dragging down organizations.
Every decade, American business schools have been graduating more than a million MBAs, most of whom believe that, because they sat still for a couple of years, they are ready to manage anything. In fact, they have been prepared to manage nothing.
HUBRIS ON A MASSIVE SCALE
Management is a practice, learned in context. No manager, let alone leader, has ever been created in a classroom. Programs that claim to do so promote hubris instead. And that has been carried from the business schools into corporate America on a massive scale.
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Harvard prides itself on how many of its graduates make it to the executive suites. Learning how to present arguments in a classroom certainly helps. But how do these people perform once they get to those suites? Harvard does not ask. So we took a look.
Joseph Lampel and I found a list of Harvard Business School superstars, published in a 1990 book by a long-term insider. We tracked the performance of the 19 corporate chief executives on that list, many of them famous, across more than a decade. Ten were outright failures (the company went bankrupt, the CEO was fired, a major merger backfired etc.); another four had questionable records at best. Five out of the 19 seemed to do fine. These figures, limited as they were, sounded pretty damning. (When we published our results, there was nary a peep. No one really cared.)
How much discussion has there been at Harvard about the role it might have played in forming the management styles of graduates who, over the past eight years, have been running America and what used to be its largest company? The school is now reviewing its MBA program, but the dean has made it clear that questioning the case-study method will not be on the agenda.
In this, we have America's problem in a nutshell: the utter absence of collective introspection, whether it be the current crisis, the relationship between the Vietnam and Iraq debacles, even what might have contributed to 9/11, as well as the way it has been compensating and educating its corporate "leaders." The country seems incapable of learning from its own mistakes.
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I earned my MBA in 1992, at age 52, after earning my MS in 1990. I was still working at IBM, and had recently moved to “Technical Marketing Representative” from Systems Engineer. IBM was paying the full cost of both programs, and I am certain that these two “tickets” were the key to completing the 30 years at IBM that provided for the full, defined benefit retirement benefits I began to receive December 1, 1995.
These were the years when IBM broke its implied full employment policy and began large scale layoffs of long term, productive employees.
But during those years, they hired paid interns to work with us over the summers - and locally, we had one of the prizes, a Harvard MBA candidate. However, she was REALLY naive about information technology in general, and computers in particular.
What I found disturbing was the deference shown by local management to this young lady not even half way TO her MBA.
Gee, and I was giving Yale all the credit. I guess Harvard get's another winner on it's Dean's list.
There was an article about seven or eight years ago in one of the magazines in the Forbes/Fortune category pointing out how Harvard MBAs can generally be counted on to torpedo their employers.
But as the author points out, that's not the case anymore. CEOs can fail and just float on their golden parachute to another position.
Years ago, at a Naval Reserve weekend, I was in the BOQ one night doing homework for UMass Business School. It dealt with lineral transporation, a gruesome stew of calculus and statistics. My roommate, a Harvard Business School student, asked me what I was doing. I explained and said that surely he had the same sort of homework? No, he didn't. What about the three semesters of calculus and statics UMass students had? Blank look. No, they didn't do any of that at Harvard. I asked what they did. "We read cases." Huh? Without any finance or math? Yup. They read cases for several years, graduated, and got huge-paying jobs on Wall Street. I'll never forget that conversation.
Obama’s ALLEGED degrees. No one has actually ever seen them.
I have found that an MBA is a person, overeducated, overconfident, overpaid and underworked who cannot make it to his/her 15th floor executive office unless the elevator is maintained by a qualified repair person who has greasy hands, stained clothes, callused hands, and a sure knowledge of his own place in the world order.
If you don’t know who REALLY keeps this world going minute by minute or day by day, then you may have an MBA.
btt
bflr
The Peter Principle in action.
Hayes and Teddy Roosevelt were also military officers.
So, I’ll see your list of Harvard grads and raise you a list of Presidents with military service:
Washington
Jefferson
Madison
Monroe
Jackson
Harrison
Tyler
Taylor
Fillmore
Pierce
Grant
Hayes
Garfield
Arthur
Need I go on?
Uhhh...I don’t believe Jefferson or Madison saw any military service.
Both were Colonels in the Virginia militia, IIRC, although, you’re correct that neither of them were combat commanders.
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