The Root Cause

Rethink Your Approach To Solving Stubborn Enterprise-Wide Problems

Moral Leverage — A Precept for Success AND Failure

            Milton Friedman asserted that The Business of Business is Business, which implies that EVERYTHING and EVERYONE is given a price tag. Consequently, decision makers just have to calculate whether they regard you, or any other animate or inanimate resource, as either ECONOMIC, or UNECONOMIC. Uneconomic refers to something or someone failing to earn an adequate profit in terms of money for those who operate / own the business. So, no need to become emotional, because this is business; nothing personal! Or, is it?

Question:        Could the current OBSESSION with a wide range of prescriptions aiming to improve inter-personal relationships―a.k.a. leadership studies―be explained as a countervailing force to the widespread idolatry of making money?

Don’t get me wrong, profits are important as a PREREQUISITE for a sustainable business, but are they the reason for being IN business; the PURPOSE for which the system is Designed, Structured or Organized, Operated or Implemented, Maintained, and Managed?

Is Making Money All That Counts?

            THEY proclaim that WE―as a society―are facing an Economic Crisis when unintended and unwanted EFFECTS undermine the validity of Friedman’s assertion. I believe that what THEY call an economic crisis is in fact a MORAL CRISIS! Let me explain.

            System’s thinkers acknowledge that businesses are NECESSARY for economic production, but they also assert that having businesses by themselves is not SUFFICIENT. For business to succeed it needs, for example, infrastructure—transportation by road, rail, water, and air; gas, electricity, water, sewer, waste treatment, telephone, internet—skilled labor, education and training facilities, supply chains, distribution channels, buyers with purchasing power, financial institutions, insurance, and a legal framework; in short, a supportive ENVIRONMENT!
Needless to say, there’s more to business than business alone.

            Nonetheless, executive decision makers may CHOOSE to ignore many characteristics of life―such as humanity, quality, ethics, equality, sustainability, environmental consciousness, and social responsibility―simply because they believe, albeit erroneously, that these qualities are uneconomical. Yet, they CANNOT ignore the unintended and unwanted consequences of their subsequent decisions. Indifference, not caring about anything other than making money, is what Eli Wiesel called the epitome of all evil.

Precept for Success AND Failure

            People are valued and respected for their uniquely human characteristics such as curiosity, ingenuity, creativity, resourcefulness, empathy, tenacity, determination, passion, goal orientation, team work, work ethic, loyalty, vision, caring, perseverance, pride of workmanship, collegiality, cooperation, insight, understanding, skill level, and professionalism, to name but a few.

Question:        Which precept for CEO Effectiveness encourages or discourages employees to demonstrate these uniquely human qualities for the benefit of someone other than themselves? Most notably, executives, board members, owners, and shareholders.

Answer:          The late Col. John R. Boyd USAF—America’s foremost military strategist—identified what he called Moral Leverage. Boyd, like Sun Tzu and Napoleon before him, believed in influencing the MIND of opponents by diminishing their ability to communicate or interact―ISOLATION―with their environment, while sustaining or improving that of us, our allies and the non-committed―INTEGRATION.

            Executives who justify their indifference to those aspects of life they call “uneconomic” tend to isolate employees from their environment. Keeping secrets, not involving those who do the actual work in decision making processes, denying the right to share compensation packages, denying equal pay for equal work, lobbying against specific employee benefits, and threatening to outsource production to a low-wage country are examples of common practices that undermine morale. When people no longer trust what they are being told, their mental ability to make sense of their reality takes a hit. Consequently, they give up physically; they quit quietly, they disengage, they no longer care and their job becomes just a pay check. To blame them is adding insult to injury!

            Imagine what is possible by sustaining or improving people’s ability to communicate or interact with their environment? Don’t think for a moment that leadership best practices aimed at improving interpersonal relationships are any substitute for boosting morale and fortifying mental capacity. Remember the expression fool me once shame on you, fool me twice shame on me!

            No wonder Boyd described leadership as The art of inspiring people to enthusiastically take action toward the achievement of uncommon goals. Do you know the goals of your people? Are you aware of their aspirations? What do you know about their hobbies and interests? Are you concerned for their well-being? Are you giving them an opportunity to do their best? Just do this for pure selfish reasons. If it works in battle it will work for you in business. Have fun!

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