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Responsibility and AccountabilityResponsibility and Accountability

October 26, 2009 October 26, 2009 EngagementEngagement

Thought to PonderThought to Ponder

What would happen if the What would happen if the dollar would collapse?dollar would collapse?

Currently _devaluing_against foreign Currently _devaluing_against foreign currencies. Collapse…worth very currencies. Collapse…worth very

little...value compared to other little...value compared to other currency is insignificant.currency is insignificant.

Dollar Devaluation Dollar Devaluation Dollar “Unofficial” Reserve Currency

“Well Managed” (Until recently)(63% of reserves non dollar)

= Habit

Peter Morici – University of Maryland – Former Chief Economist US International Trade Commission - Newsweek 10/26/2009

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Dollar Dollar (Until Recently)(Until Recently)

William Buiter – London School of Economics

American Alpha Theory.- US make more on foreign investments. - US investments – demand declining.

Growing debt and trade deficits.

Leads to higher interest required to be paid and significantly added costs.

Stimulus -spending more than making = short-term thinking.

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Dollar Dollar (Until Recently)(Until Recently)

If it would collapsePrices of foreign goods would skyrocket.

US inflation. Higher interest rates.Trade barriers by other countries. (trade wars)

Newsweek 10/26/2009

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Cost Reduction Rarely Creates a Cost Reduction Rarely Creates a Competitive Strategy.Competitive Strategy.

Michael Porter

Where most companies who are having problems turn first!

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90% of companies growing less than GDP growth.

Growing less than GDP is referred to as StallingGrowing less than GDP is referred to as Stalling.

Once a company stalls only 4% can re-ignite growth GDP growth.

Clayton Christenson - Harvard

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We have become a society/culture of “finger pointers.”

Victims of something/someone else!

Not my fault! I know how to fix it others will not do what I say! Someone else has to change!

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Responsibility Avoidance!

Thirst for Exposure!The Blame Game!

The culture of victimization has weakened the American character stressing:The culture of victimization has weakened the American character stressing:

Ease over difficulty !Felling good over being good!Appearance over substance!

Saving face over problem solving!Illusion over reality!

“The Oz Principle” – Connors – Smith - Hickman

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Responsibility Avoidance!

Threatens to destroy the American corporate character by emphasizing quick fixes over long term solutions, immediate gains over enduring processes,

quality programs over enduring quality attitudes, and process over results…too many CEO’s hand off

accountability to subordinates without acknowledging their own responsibility for results.

“The Oz Principle” – Connors – Smith - Hickman

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Contented Employees Contented Employees 3X 3X RevenueRevenueBill Catlette & Richard HaddenBill Catlette & Richard Hadden 3X3X ProfitsProfits

Culture and Strategy AlignCulture and Strategy Alignmentment 4X 4X Revenue GrowthRevenue GrowthJohn P. Kotter & James L. HeskettJohn P. Kotter & James L. Heskett 12X 12X Stock ValueStock Value

100X 100X Net Income GrowthNet Income Growth

Involvement Involvement 3X 3X ROE ROE Denison Consulting, Denison Consulting,

High TrustHigh Trust 3X ROE3X ROEStephen M. R. CoveyStephen M. R. Covey

Focus on All StakeholdersFocus on All Stakeholders 4X 4X Revenue GrowthRevenue GrowthHarvard UniversityHarvard University

Disengaged to Engaged EmployeesDisengaged to Engaged Employees $250 Billion - $1 Trillion Profit $250 Billion - $1 Trillion ProfitGallup – ‘How Full is Your Bucket?”Gallup – ‘How Full is Your Bucket?” Improvement Opportunity…USAImprovement Opportunity…USA

Cost of Complexity & Related StressCost of Complexity & Related Stress $1.1 Trillion …USA$1.1 Trillion …USABill Jensen – “Simplicity.”Bill Jensen – “Simplicity.”

Engaging Human Capital is a Great Business Decision!Engaging Human Capital is a Great Business Decision!

Companies Utilizing the Listed Actions Outperform Those Who Do Companies Utilizing the Listed Actions Outperform Those Who Do NotNot!!

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If everyone would focus on making the If everyone would focus on making the world better…“Leave it better than world better…“Leave it better than

you found it”… It would be a you found it”… It would be a perpetuating gift! perpetuating gift!

• No matter what your major…Your No matter what your major…Your legacy…Your perpetuate gift!legacy…Your perpetuate gift!

Step #1…Focus on something larger Step #1…Focus on something larger than YOU!than YOU!

Step #2…Focus on something Step #2…Focus on something larger than YOU!larger than YOU!

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““Purpose” has become an “In Vogue” wordPurpose” has become an “In Vogue” word..

“Living with a Purpose”“The Purpose Driven Life”

A “Purpose” is larger than “YOU!”A “Purpose” is larger than “YOU!”

““Meism” is the enemy of “Purpose!”Meism” is the enemy of “Purpose!”

“Purpose” Adds Value to Something Larger than “YOU!”

Majority…walk/march to the beat of “ME!”“ME!”

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Dee Hock – Founder & CEO Emeritus of VISA… “Birth of Dee Hock – Founder & CEO Emeritus of VISA… “Birth of the Chaordic Age.”the Chaordic Age.”

Chaord (kay-ord)…Seamless blending of chaosAnd order.

Chaos/disarray…Precludes order…ego, envy, greed, and ambition…drive disarray.

““Society and the biosphere are increasingly in disarray?”Society and the biosphere are increasingly in disarray?”

“Me” focused traits!

Organizations are increasingly in disarray!

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The New American The New American WorkplaceWorkplace

James O’Toole and Ed LawlerJames O’Toole and Ed LawlerDespite a recent surge in productivity growth…Despite a recent surge in productivity growth…

2005 United States now ranks 82005 United States now ranks 8thth in the world in the world vs. 1vs. 1stst in 1973. (Now 11 in 1973. (Now 11thth))

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This drop is significant…Productivity This drop is significant…Productivity growth is perhaps the best single growth is perhaps the best single indicator of a indicator of a nation’s economic health.nation’s economic health.

Our general conclusionOur general conclusion is that, in far too many is that, in far too many instances, the United States is attempting to implement instances, the United States is attempting to implement

tomorrow’s competitive strategies with tomorrow’s competitive strategies with yesterday’s managerial ideas.yesterday’s managerial ideas.

Replace “Me” with “Disarray”

Trade:

Ego for HumilityEnvy for self control

Greed for timeAmbition for Liberty

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““LeadersLeaders in good-to-great companies in good-to-great companies have both ‘personal humility’ and a have both ‘personal humility’ and a

‘ferocious and terrifying will’…first and ‘ferocious and terrifying will’…first and foremost for the cause, the work – foremost for the cause, the work – Not Not Self.Self. I once thought these leaders were I once thought these leaders were ‘freaks of nature’‘freaks of nature’ but now I believe but now I believe they are they are All Over The Place…All Over The Place… the the problem is problem is WeWe keep giving the keys to keep giving the keys to

The Wrong People.”The Wrong People.”

Jim Collins author of “Good to Great” at the 2003 SHRM National Conference

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Executive CharacteristicsExecutive Characteristics

• They see themselves and their They see themselves and their companies as dominating their companies as dominating their environment.environment.

• They believe their interests They believe their interests are the company’s interests.are the company’s interests.

• They think they have all the They think they have all the answers.answers.

• The eliminate anyone who is The eliminate anyone who is not behind them 100%not behind them 100%

• They are obsessed with the They are obsessed with the limelight.limelight.

• They underestimate obstacles.They underestimate obstacles.• They rely on what worked for They rely on what worked for

them in the past.them in the past.

•• Place company before self.Place company before self.•• Get right people on board, Get right people on board,

who possess “Good to Great” who possess “Good to Great” qualities.qualities.

•• Confronts honest truth about Confronts honest truth about capabilities.capabilities.

•• Unrelenting focus on core Unrelenting focus on core competency/strengths.competency/strengths.

•• Culture of execution.Culture of execution.•• Technology as an accelerator.Technology as an accelerator.•• Gathering momentum vs. Gathering momentum vs.

short term spinningshort term spinning..

Seven Habits of Spectacularly Seven Habits of Spectacularly Unsuccessful Executives…Unsuccessful Executives… Sydney Finkelstein – “Why Smart Executives Sydney Finkelstein – “Why Smart Executives FailFail

Characteristics of “Good to Characteristics of “Good to Great LeadersGreat Leaders – – “Good to “Good to Great”…Jim CollinsGreat”…Jim Collins

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70% of senior executives are alpha males… bold, demanding, self confident, high

intellect, aren’t happy unless top dogs, get stressed if tough decisions are not in there

hands, independent action orientated, think fast not good listeners, speak alpha

speak and if do not speak alpha speak think dumb, have opinions on everything

and they are right, do not admit mistakes.

Manipulate, Maneuver, and Muscle!Manipulate, Maneuver, and Muscle!

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As a general rule, the society in the USA As a general rule, the society in the USA finds more manipulating, maneuvering, finds more manipulating, maneuvering,

and muscling, than value adding actions.and muscling, than value adding actions.

As a result, we find our ability to compete in an As a result, we find our ability to compete in an increasingly global economy is decling….Our economic increasingly global economy is decling….Our economic dominance is being eroded. (The USA is now 11dominance is being eroded. (The USA is now 11thth in the in the

annualized productivity growthannualized productivity growth)

Everyone needs to step up their focus Everyone needs to step up their focus (responsibility and accountability) on economy (responsibility and accountability) on economy

strength vs. personal wealth accumulation.strength vs. personal wealth accumulation.

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As a general rule, productivity gains are process As a general rule, productivity gains are process or procedural driven changes. or procedural driven changes.

Many productivity attempts are top down imposed manipulations, maneuvers , or

musclings.

““The Right to Do” vs. The Right to Do” vs. ““Doing What is Right!”Doing What is Right!”

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Contented Employees Contented Employees 3X 3X RevenueRevenueBill Catlette & Richard HaddenBill Catlette & Richard Hadden 3X3X ProfitsProfits

Culture and Strategy AlignCulture and Strategy Alignmentment 4X 4X Revenue GrowthRevenue GrowthJohn P. Kotter & James L. HeskettJohn P. Kotter & James L. Heskett 12X 12X Stock ValueStock Value

100X 100X Net Income GrowthNet Income Growth

Involvement Involvement 3X 3X ROE ROE Denison Consulting, Denison Consulting,

High TrustHigh Trust 3X ROE3X ROEStephen M. R. CoveyStephen M. R. Covey

Focus on All StakeholdersFocus on All Stakeholders 4X 4X Revenue GrowthRevenue GrowthHarvard UniversityHarvard University

Disengaged to Engaged EmployeesDisengaged to Engaged Employees $250 Billion - $1 Trillion Profit $250 Billion - $1 Trillion ProfitGallup – ‘How Full is Your Bucket?”Gallup – ‘How Full is Your Bucket?” Improvement Opportunity…USAImprovement Opportunity…USA

Cost of Complexity & Related StressCost of Complexity & Related Stress $1.1 Trillion …USA$1.1 Trillion …USABill Jensen – “Simplicity.”Bill Jensen – “Simplicity.”

Engaging Human Capital is a Great Business Decision!Engaging Human Capital is a Great Business Decision!

Companies Utilizing the Listed Actions Outperform Those Who Do Companies Utilizing the Listed Actions Outperform Those Who Do NotNot!!

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Trusting, contented, engaged, involved, and Trusting, contented, engaged, involved, and aligned organizations are not manipulated, aligned organizations are not manipulated,

maneuvered, or muscled. maneuvered, or muscled.

Great organizational strength comes from Great organizational strength comes from willingness to accept accountability and willingness to accept accountability and

responsibility from within vs. driven/directed responsibility from within vs. driven/directed from above from above!from above from above!

Great organizations have a great Great organizations have a great

Collective competitive mindset!Collective competitive mindset!

Culture!Culture!

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Cult or Culture?Cult or Culture?• CultCult

– Powerful individual or small group-set direction and make decisions

– Organization acts out of fear

– Information often not shared

• Organization afraid to speak openly (Lack of Reality)

• Mistakes recognized but not passed upward

• Communication is a one way rhetoric flow

– Success attributed to the “few”

– Inequality in people– Control, permission must

be granted– Data based logic– Illusions of greatness

• CultureCulture

– Ideas from many cultivated by leaders

– Organization acts out of knowledge and alignment

– Knowledge deep in the organization

– Organization values ideas– Understand that mistakes

must happen to advance– Primary communication is one

on one interchange– Success credited to “all”– Everyone is of equal value– Freedom, authority is

delegated

– Emotions engaged– True awareness

Adapted from the Leader to Leader article, “Leadership Cults or Cultures” - #28 Spring 2003 – Anne Deering, Robert Dilts, & Julian Russsell

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TheThe Culture And Capabilities Culture And Capabilities Of Of Your Organization Is A More Your Organization Is A More

Important Important Source Of Source Of Sustained Sustained SuccessSuccess Than Size, Industry, Than Size, Industry,

Markets Serviced, Strategy, Or Markets Serviced, Strategy, Or Market PositionMarket Position. (Study of the . (Study of the culture can predict the future culture can predict the future

success of a company)success of a company)“The Human Equation: Building Profits By Putting People First” by Jeffrey Pfeffer

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Responsible and accountable people understand Responsible and accountable people understand and accept… and accept…

Reality!Reality!

Without Without realityreality…decisions only …decisions only have a random probability of have a random probability of

being right! being right!

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Responsible and Accountable people focus on …Responsible and Accountable people focus on …

Potential vs. Success!Potential vs. Success!

Success is measured based on the past…Success is measured based on the past…potential is based on what is possiblepotential is based on what is possible

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Responsible and Accountable people:Responsible and Accountable people:

-Deemphasize “Me.”-Accept reality.-Let go…Make and hold everyone responsible and accountable.-Do what is right.

Trusting, Contented, Engaged, Trusting, Contented, Engaged, Involved, and Aligned organizations. Involved, and Aligned organizations.

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