Cisco has been in the news this month as chief executive, John Chambers, admitted in a memo to employees that Cisco has lost its way (http://blogs.wsj.com/deals/2011/04/05/read-cisco-ceos-mea-culpa-no-excuses/). To show shareholders he’s serious, Cisco shut down the Flip video camera business and promised to undergo an organizational restructuring. Chambers promised “tough decisions in the wake of recent lapses in execution,” as The New York Times reported.
In a recent article in the Wall Street Journal, Cisco says that it will “exit aspects of its consumer business.” The announcement comes just one week after Cisco’s CEO sent out a memo confessing to severe issues with slow decision making and a lack of “discipline” at the company.
One can’t help wonder, what happened? Shareholders may report loses at Cisco and unsound or slow leadership, however I’m wondering if we are looking in the right places. Perhaps in Chambers memo there lies a clue…”Our strategy is sound. It is aspects of our operational execution that are not. We have been slow to make decisions, we have had surprises where we should not, and we have lost the accountability that has been a hallmark of our ability to execute consistently for our customers and our shareholders.”
In 2009 according to the Wall Street Journal, Cisco Systems Inc. posted a 46% drop in quarterly profits. While that news would make most managers faint, Chambers took action and promised to get Cisco back to double-digit growth. His strategy involved moving the company into more businesses. The report states, “He (Chambers) has decided to replace Cisco’s top-down decision making with committees of executives from across the company. Some teams provide strategic advice and evaluate the progress of these projects. In total, Cisco now has 59 internal standing committees.”
At the time Chambers stated, “We are moving to collaboration teams, groups coming together that represent sales, engineering, finance, legal, etc. We now do that with 70 different teams in the company. So we’ll have a sales leader go run engineering. A lawyer go run business development. A business development leader go run our consumer operations. We’re going to train a generalist group of leaders who know how to learn and operate in collaboration teamwork.”
At the time, what seemed slightly nuts to many were innovative to the rest. In 2009 I wrote that this was either the most brilliant plan ever devised or the most insane. Either way Chambers created the platform necessary for responsibility and change. And so he did.
Now Chambers finds himself in a position where his consumer business has not fared well and as he said, “We have disappointed our investors and we have confused our employees.” Was this from poor collective decision making by 59 or more standing teams or more run amuck; or was this Chambers and his senior teams’ leadership that has put the company in such jeopardy?
Only the annals of history will prove whether or not Chambers has either been a wonderful risk taking CEO who has taken responsibility for his actions, or a poor executive who has made a flurry of choices that has put the company in great jeopardy.
What is bothersome about Chambers memo is not once does he apologize for putting the company at risk. He does not say that as the leader of this organization it was actually his responsibility to lead well and strong without shutting down divisions, laying people off and now undergoing a corporate restructuring.
This is emblematic of Nokia CEO’s Stephen Elop’s “Burning Platform” memo, which took severely to task the company’s growth and direction without providing concrete steps on how to get to a destination plus without taking proper accountability.
Let’s go back to leadership basics. One of the cornerstones of leadership is responsibility. Even if you close the company at the end of the day, if you took responsibility for the doors closing then you are indeed a leader.
As renowned author Jim Collins said in his leadership book, “Good To Great,” about stellar leaders, “They look in the mirror to apportion responsibility, never blaming bad luck when things go poorly.”
How do you take responsibility:
1. Say I'm sorry
2. Stay clear of excuses
3. Acknowledge your part
4. Control your reactivity
5. Be accountable - you have chosen your behavior and now you must live with the consequences
6. Learn from your mistakes
7. Take proactive steps to change your behavior
8. Don't beat yourself up - this does nothing to change the situation or bolster your self esteem
I'm extolling a basic leadership virtue – responsibility and advocating for every person who reads this to take it and do so with gusto. Taking responsibility is not pretty, however you will sleep better at night if you do.
Wednesday, April 27, 2011
Friday, April 8, 2011
Momma Becomes CEO or Can She?
This week the management-consulting firm McKinsey & Company released a report on the barriers to women advancing in corporate America. One of the main reason was inadequate career development. It’s not that organizations are not making some effort, it’s that they are not making enough. According to the Wall Street Journal, for example, “only 11 chief executives of Fortune 500 companies are women, down from a peak of 15 in 2010. “ Well that’s certainly better than in 1995 where there was only one CEO among the ranks of the top Fortune 500 companies.
McKinsey also cited a report by the non-profit research group Catalyst Inc. that stated 37% of lower level and middle managers are female, while only 26% of vice presidents and other senior managers are women at Fortune 500 companies. In other words, women are great in low to middle management, beyond that well…leave it to the guys!
Being a bit partial because I am a woman, it’s curious why women are not advancing faster. "By increasing the number of women who make it from middle management to the vice presidential level, corporations could vastly improve the odds for building diversity in top management," the report added. Even a 25% increase in the ranks of middle-management women reaching the next level "would significantly alter the shape of the pipeline," it said.
Are we not promoting our female counterparts? And if we are, how much, how often and are we really looking for opportunities for women to advance? How many companies truly have programs devoted to the advancement of women. Seems as if women are sometimes lumped into the corporate diversity bank and then pray that promotions will come with hard work.
It’s up to organizations to put a careful spotlight on grooming and growing women. You may ask…why women? Why not men? Women are simply not viewed in the same way as men. When a pregnant belly walks into the room leading the way for the woman carrying the belly, how can a woman possibly be viewed on the same rung as a man? A woman does have children, requires taking leave to actually have the children, takes time off to take children home from school or the doctor, etc and some women don’t even come back to work after giving birth. Women have multiple roles at work and at home, piling on the workload more and more in some instances with little to no help.
Joanna Barsh, a McKinsey senior partner who co-wrote the report said, “companies need to spend more time coaching women and offering more leadership training and rotation through various management roles before their ambitions sour….companies are not systematically watching these women at the middle management level and putting in programs that would help them develop and get over the next [promotion] hurdle."
Barsh further explained that the rarity of such help partly explains why women’s ambitions decline over time and barriers become insurmountable especially for working mothers.
The McKinsey report advocates having strong programs specifically tailored to training, developing and coaching women. The report also suggests that companies work harder to shift the internal culture that limits opportunities for women and instead have the performance of top managers measured on their ability to groom, grow and promote female talent.
This is certainly a critical idea because if people are not incentivized, women will fall by the wayside. The future of our young girls is in jeopardy. For all of the girls who want to work hard to be just like their mothers we are giving them a dim view of their career potential. It’s time for us to foster a culture of inclusion not only for women, for everyone. We’ll see evidence of this when diversity sits at the executive levels and not simply white men in pinstripe suits.
McKinsey also cited a report by the non-profit research group Catalyst Inc. that stated 37% of lower level and middle managers are female, while only 26% of vice presidents and other senior managers are women at Fortune 500 companies. In other words, women are great in low to middle management, beyond that well…leave it to the guys!
Being a bit partial because I am a woman, it’s curious why women are not advancing faster. "By increasing the number of women who make it from middle management to the vice presidential level, corporations could vastly improve the odds for building diversity in top management," the report added. Even a 25% increase in the ranks of middle-management women reaching the next level "would significantly alter the shape of the pipeline," it said.
Are we not promoting our female counterparts? And if we are, how much, how often and are we really looking for opportunities for women to advance? How many companies truly have programs devoted to the advancement of women. Seems as if women are sometimes lumped into the corporate diversity bank and then pray that promotions will come with hard work.
It’s up to organizations to put a careful spotlight on grooming and growing women. You may ask…why women? Why not men? Women are simply not viewed in the same way as men. When a pregnant belly walks into the room leading the way for the woman carrying the belly, how can a woman possibly be viewed on the same rung as a man? A woman does have children, requires taking leave to actually have the children, takes time off to take children home from school or the doctor, etc and some women don’t even come back to work after giving birth. Women have multiple roles at work and at home, piling on the workload more and more in some instances with little to no help.
Joanna Barsh, a McKinsey senior partner who co-wrote the report said, “companies need to spend more time coaching women and offering more leadership training and rotation through various management roles before their ambitions sour….companies are not systematically watching these women at the middle management level and putting in programs that would help them develop and get over the next [promotion] hurdle."
Barsh further explained that the rarity of such help partly explains why women’s ambitions decline over time and barriers become insurmountable especially for working mothers.
The McKinsey report advocates having strong programs specifically tailored to training, developing and coaching women. The report also suggests that companies work harder to shift the internal culture that limits opportunities for women and instead have the performance of top managers measured on their ability to groom, grow and promote female talent.
This is certainly a critical idea because if people are not incentivized, women will fall by the wayside. The future of our young girls is in jeopardy. For all of the girls who want to work hard to be just like their mothers we are giving them a dim view of their career potential. It’s time for us to foster a culture of inclusion not only for women, for everyone. We’ll see evidence of this when diversity sits at the executive levels and not simply white men in pinstripe suits.
Tuesday, April 5, 2011
Even Warren Buffett Requires More Questions
How do you balance trusting your people with stepping in and asking more detailed questions? Ask legendary billionaire, Warren Buffett. Buffett has recently come under scrutiny when his former lieutenant, David Sokol at Berkshire Hathaway Inc., resigned.
As the Wall Street Journal reported, it turns out that Sokol was buying shares of a chemical company one week before he suggested that Berkshire Hathaway buy the company, which they later did.
Improper action? Depends who you ask. Sokol said carefully that he didn’t think he did anything wrong and the trades were not a part of his decision to resign. Mr. Buffett echoed Sokol’s sentiments.
Buffett is coming under fire from those who believe he may have been too trusting of Sokol and did not ask enough tough questions when presented the opportunity to purchase Lubrizol Corp and when Sokol divulged that he owned shares of the company. Berkshire Hathaway is a company known for high ethics and integrity, and as the Wall Street Journal reported, even Buffett “once told government-securities regulators that company directors should be “Dobermans” in demanding financial disclosure from managers and auditors.”
Buffett selects his people carefully and then let’s them do what they do best. This makes sense, however when does a leader step in and ask more questions and take responsibility for a potential risk to the organization? Checks and balances work in large-scale organizations when the systems and processes hold risks at their minimum. However when the systems are faulty then the risks are greater. Sometimes the system can simply be, “did we ask enough of the right questions to understand all sides?”
Careful and continuous examination and re-examination of your systems, processes and procedures allows you to propel forward rather than be slowed down. Perhaps this incident at Berkshire Hathaway is a wake up call for such a re-examination to take place and signals to all wise leaders that you are as good as your last question.
As the Wall Street Journal reported, it turns out that Sokol was buying shares of a chemical company one week before he suggested that Berkshire Hathaway buy the company, which they later did.
Improper action? Depends who you ask. Sokol said carefully that he didn’t think he did anything wrong and the trades were not a part of his decision to resign. Mr. Buffett echoed Sokol’s sentiments.
Buffett is coming under fire from those who believe he may have been too trusting of Sokol and did not ask enough tough questions when presented the opportunity to purchase Lubrizol Corp and when Sokol divulged that he owned shares of the company. Berkshire Hathaway is a company known for high ethics and integrity, and as the Wall Street Journal reported, even Buffett “once told government-securities regulators that company directors should be “Dobermans” in demanding financial disclosure from managers and auditors.”
Buffett selects his people carefully and then let’s them do what they do best. This makes sense, however when does a leader step in and ask more questions and take responsibility for a potential risk to the organization? Checks and balances work in large-scale organizations when the systems and processes hold risks at their minimum. However when the systems are faulty then the risks are greater. Sometimes the system can simply be, “did we ask enough of the right questions to understand all sides?”
Careful and continuous examination and re-examination of your systems, processes and procedures allows you to propel forward rather than be slowed down. Perhaps this incident at Berkshire Hathaway is a wake up call for such a re-examination to take place and signals to all wise leaders that you are as good as your last question.
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