A kinder, gentler Machiavelli?

This week, my book post on s+b's blogs is about scholar Maurizio Viroli's new interpretation of Machiavelli and The Prince:

A Call for True Machiavellian Leadership

It’s been 500 years—half a millennium—since Niccolò Machiavelli wrote The Prince, and for nearly as long, the man and the book have stimulated controversy and debate. The Catholic Church banned

Machiavelli’s works in 1559 (putting him in the company of Plato, Aristotle, and Homer). Since then, The Prince, a foundational text in statecraft that served as the basis for the realist school of politics, has been characterized as a “handbook for tyrants” and condemned for separating ethics and politics.

So I was understandably curious when a review copy of Redeeming The Prince: The Meaning of Machiavelli’s Masterpiece (Princeton University Press, 2013) arrived a couple of weeks ago. In it, Maurizio Viroli, a leading Machiavelli scholar and politics professor emeritus at Princeton who currently teaches at the University of Italian Switzerland, makes a strong argument for rethinking widely held assumptions about The Prince.

Viroli suggests that our understanding of the book has been skewed by misinterpretations of its historical setting and by a lack of attention to several of its key sections. As a result, we’ve unfairly demonized The Prince and its author. Machiavelli (1469–1527) was calling for a more unified and free Italy, Viroli says, and The Prince was intended to be a handbook for a leader who would undertake the task of restoring the republic—a redeemer, not a tyrant. 

Since The Prince has been widely read by business leaders, I asked Viroli if his new interpretation should prompt them to think differently of Machiavelli...read his response here.

Stephen King on opening lines

There's a very cool one-question interview with Stephen King in The Atlantic. Joe Fassler asked him about his favorite passages in a couple of his books and King mentioned two opening lines. That lead to King talking about the art and craft of a great opening line. Where are you gonna get better advice than that?

Stephen King: There are all sorts of theories and ideas about what constitutes a good opening line. It's tricky thing, and tough to talk about because I don't think conceptually while I work on a first draft -- I just write. To get scientific about it is a little like trying to catch moonbeams in a jar.

But there's one thing I'm sure about. An opening line should invite the reader to begin the story. It should say: Listen. Come in here. You want to know about this.

How can a writer extend an appealing invitation -- one that's difficult, even, to refuse?... read the rest here

A practical take on creativity

This week's book post on the s+b blog is a one-question interview with the authors of a new book proposing that we rein in our creativity efforts: 

Thinking Inside the Box
Books about business innovation seem to arrive as quickly as ideas on a whiteboard in a brainstorming session. But Inside the Box: A Proven System of Creativity for Breakthrough Results  (Simon & Schuster, 2013), by Drew Boyd and Jacob Goldenberg, jumps out for its counterintuitive take on creativity.

In the book, Boyd, assistant professor of marketing and innovation at the University of Cincinnati and former director of Johnson & Johnson’s Marketing Mastery program, and Goldenberg, professor of marketing at the Hebrew University of Jerusalem’s School of Business Administration, assert that thinking inside the box enhances idea generation. Thus, they argue, innovation initiatives should be limited to resources close at hand...read the rest here

Decisive

My weekly book post on the s+b blogs is about the Heath brothers' new book, Decisive:

Smarter Executive Decision Making Is Within Reach 

Chip and Dan Heath are back with another book that applies cognitive science to management. In 2007, the brothers—Chip is a business professor at Stanford and Dan  is a senior fellow at Duke’s Center for the Advancement of Social Entrepreneurship—had a hit with Made to Stick: Why Some Ideas Survive and Others Die (Random House), which David Hurst reviewed  in s+b’s Summer issue that year. And in 2010, they published Switch: How to Change Things When Change Is Hard (Broadway), which Judith Glaser called out as one of the year’s best business books in s+b. Their new book, Decisive: How to Make Better Choices in Life and Work (Crown Business), looks just as promising. 

So when the publisher offered me a bit of Dan’s time, I used it to ask him a question: “In writing the new book, what did you guys discover about improving a company’s executive decision making?” Read Dan's answer here...

One question: Stephen H. Greer

I don't usually bother with entrepreneur's stories, unless they happen to include the creation of a major company. But Stephen Greer's Starting from Scrap: An Entrepreneurial Success Story coming in March from Burford Books proved to be a compulsive read.

Greer's improbable tale starts with him arriving in Hong Kong in Feburary 1993 at age 24 with a few thousand bucks, no job, not speaking Chinese, and no tangible prospects...other than the idea of getting rich in Asia's economic boom. And he does!

This kid from Pittsburgh ends up building a $250 million international scrap recycling business over the next 14 years. What happens in between is a story that every wannabe entrepreneur should read: first, because it vividly describes the highs, the lows, and the personal costs of starting your own business; and second, because anyone who has ever started a business on a bootstring will tell you it rings true.

My question for Stephen: Looking back, what personal trait turned out to be most important to your success? Here's his answer:

I would say persistence. What I uncovered in my pursuit of success as an entrepreneur is that most things do not come easily and that even if all the logic stacks up behind an idea, it is sweat, persistence, and determination that make it happen.

Along the way, I often wondered if I was going to make it and felt frustrated, if not cheated, that I was not achieving the planned results. Sometimes the problems were beyond my control: employee fraud, interference from corrupt government officials, even Mother Nature. It seemed the harder I swam, the more strongly the current pulled against me. But I truly felt I was doing the right things at the right time in the right place and believed that if I could just overcome the current hurdle, it would be smooth sailing going forward. Of course it was not, but that belief gave me the strength to stay in the battle.

My hunch turned out to be correct and I was generously rewarded when our plans started to achieve success. Ultimately, a large publicly-listed company recognized the value that our hard work had created and bought us out at an attractive valuation. But I think many people would have quit before achieving that successful end result because of the pain that had to be endured to get there.

Of course, my advice to up-and-coming entrepreneurs is to strenuously challenge and test the logic behind your idea. But if you still find merit in your plans after that and believe the market will value what you are doing, be tenacious and persistent in the pursuit of your plans and goals.

One question: Les Leopold

Les Leopold's readable new book, The Looting of America: How Wall Street's Game of Fantasy Finance Destroyed Our Jobs, Pensions, and Prosperity—and What We Can Do About It is out this month from Chelsea Green. Les directs two nonprofits, The Labor Institute and The Public Health Institute, which are aimed at educating union workers on public policy issues.

The crux of Les' thesis, if I can summarize without subverting, is that the roots of this recession lie in the gap between productivity and real wages, which began growing in the early 1970s. Instead of going to workers in the form of wages, who would have spent the money on real goods and services that grow economies, productivity gains began going to owners and executives, who, having all the stuff they needed, invested the money. All this new money seeking good returns led to risky lending practices and financial instruments, which, in turn, led to the current mess.

This is a provocative and debatable argument, and certainly one that will resonate in pro-labor circles. My question for Les: In pegging the financial meltdown in the U.S. to the decoupling of productivity gains and real wages, the underlying inference is that those gains – or a larger portion of them – were wrongly diverted away from wage earners. What caused this divergence and why are wage earners entitled to a larger portion of productivity gains?

Here's his reply:

There really is no consensus on why productivity and wages diverged so dramatically. I can only give you my read. I think several trends entwined to undercut the price of labor.

First was what we call “globalization” which, in this case, refers to the ability of corporations to move capital quickly to all parts of the globe. The Bretton Woods agreements, which ended in the early 1970s, had previously prevented such rapid movement of investment capital. But after its collapse, corporations could set up shop in low-wage areas and import the final products back into the United States. American labor, in effect, was in direct competition with workers all over the globe.

This led to the second factor: the decline of unions. The globalization process and its impact on U.S. workers could have been mitigated, in my opinion, had the labor movement been stronger. But labor union density had been in a secular decline since the mid-1950s. Why that happened is a much longer story, but the impact was two fold: First, unions could not moderate national policies on deregulation, capital flight and cheap imports; and second, unions could not effectively bargain hard at the workplace.

The third set of factors involved a shift in political power to the upper income brackets. During the Reagan era and beyond, social programs were slashed, taxes on the wealthy were reduced, the minimum wage was not increased to keep up with the cost of living, and labor laws were weakened.

I don't think we can blame new technologies for the transfer of productivity gains. The computer revolution came later as did the Internet. Manufacturing was becoming more and more automated throughout the 1950s and 1960s. In fact, there was much hand-wringing in the late 1950s about the impact of automation on work and the rise of leisure --- what would workers do with all their free time?

That's why my main point is the following: The distribution of the fruits of productivity is more like a tug of war – a genuine struggle between the investor class and the rest of us. It’s not automatic. Policy impacts the division of the pie.

There is, however, an additional and very important factor to consider, no matter whether you favor more money for working people or more for the investment classes. I think we are living through a real life experiment about what happens when you let too much money accumulate at the top: It runs out of tangible investment opportunities in the real economy and much of it ends up in Wall Street’s fantasy finance casino.

There is a relationship between the rising gap between the super rich and the rest of us, and the crashing of the economy. Such were the conditions before the Great Depression and those conditions almost led us there again. I believe that for the sake of the entire economy, it is best to narrow the income/wealth gap.

One question: Dan Carrison

I was fascinated by the FBI’s Ten Most Wanted Fugitives List as a kid. In those pre-digital days, the Ten Most Wanted - do not approach, they are armed and dangerous - were hung on a clipboard in the local post office. I carefully perused them to be sure none of them were masquerading as my neighbors, friends' parents, or elementary school teachers - or perhaps, just buying a few stamps to send Christmas cards to their gangs.

Dan Carrison, a partner in Semper Fi Consulting and founder of ghostwritersinthesky.com, has resurrected my interest in the list. Dan's new book (his fourth to be published by AMACOM) is From the Bureau to the Boardroom: 30 Management Lessons from the FBI. As the title suggests, the book mines the Federal Bureau of Investigation (which is celebrating its centennial this year, by the way) for business ideas.

I asked Dan about the Most Wanted list - why it was effective and whether it has any business applications. Here's his generous and thought-provoking answer:

I, too, was fascinated, as a kid with the FBI's Most Wanted posters. My first impression was always, "Those tough-looking guys don't stand a chance, with the FBI on their tail." But as I grew older, I wondered why the FBI published their 10 Most Wanted list. After all, they could keep the list as an internal document for all law enforcement agencies, and spare themselves the possibility of public criticism for not having captured a high profile criminal.

The FBI, by broadcasting the names and faces of its Most Wanted criminals, is leveraging the eyes and ears of the tens of millions of citizens who gaze upon the list. It is also creating a whole new level of oversight from the general public. The "pressure is on" to perform! I also think that once our goals are announced, they have a better chance of being achieved, through the benevolent serendipity of the universe.

This concept could work equally well in private enterprise. A Top Ten list of “most wanted” customers, if posted conspicuously, would alert all within the organization—from the boardroom to the mail room—of the desired business that is still “roaming free.” Why shouldn't that be common knowledge? It might surprise many a CEO to discover how few employees in the wide organization have even an inkling of the top targets of the sales department.

The effect could be galvanizing; the list would be a constant reminder of the most desirable accounts “out there” in the marketplace. Each “poster” would be modeled after the real thing—with a flattering photo of the CEO the company wants to do business with, some organizational stats, and a “reward” to the employee who contributes to the establishment of business relations.

Now every employee would be “in the know” and explicitly recruited in the quest. And one never knows what can happen when the entire workforce is being leveraged. For example: a clerk in accounts payable may have a friend who works in the “top tenner” company’s purchasing dept.; a delivery man may have noticed something unusual driving by the company—such as a strange truck pulling away from the loading dock, suggesting a change of vendors; an IT tech may have read something on an industry blog that portends change (and opportunity!) within the top tenner’s infrastructure.

These little bits and pieces of information could prove to be very helpful to the company’s strategists. But the information will not be communicated unless the rank and file is involved in the hunt for new business. A conspicuous Top Ten list would keep the company’s goals fresh in everyone’s mind—especially if there were to be a Reward (such as a tropical vacation for two) for information leading to the “capture” of the client.

By publishing its top ten target customers (i.e., through conspicuous ads and commercials), the company would, like the FBI, invite the pressure of the public. Stockholders would ask about the progress made in reining in the top ten accounts at every shareholder meeting. Business journalists would reference the list, and perhaps even make fun of its ambitiousness. The current suppliers of the top ten companies would be put on notice that determined competition is coming after them and not afraid to say so. And the targeted customers? They would love it!

Just imagine a CEO picking up the Wall Street Journal and seeing his/her own “Wanted” photo posted, and his company listed as the stated business goal of a vendor—publicly, fearlessly, audaciously. The impression could be nothing but positive. The name of the vendor would be forever ingrained in the CEO's consciousness. He would investigate. What kind of company are they? And look! One of the Top Ten has been “captured" and is now doing business with this audacious supplier. The CEO might call that company and ask about their experience with the bold supplier; he might tell his purchasing department to entertain a quote. He might say to himself, “Surely, a vendor willing to go to these lengths—publicly—to acquire my business would do much in the way of customer service to keep it.”

To carry this somewhat fanciful, but eminently doable, metaphor further, there would even be a certain amount of public pressure now exerted on the target customer. He might be asked by his own shareholders or BOD members, “Why haven’t you done business with this vendor who has laid his reputation on the line to work with you? Have you at least spoken to him?”

A vendor is known by its customers; that’s why so many marketing campaigns are eager to list the prestigious organizations already being served. But a vendor can also be known by the customers it wants to serve. The higher the ambition, the stronger the company looks—for surely it wouldn’t aspire to serve a premier customer if it couldn’t actually provide the service. A supplier with the courage to take on such an imaginative initiative as a Top Ten List of Most Wanted Customers would surely be a salient feature on the business landscape.

One question: Timothy Butler

I didn't have a clue what I wanted to be when I was a kid. I didn't do much better as a so-called adult, stumbling around careerwise until my mid-30s. The only saving grace was that I was pretty willing to jump off whatever ship I was on and start swimming in another direction whenever wherever I was heading didn't seem fulfilling. And eventually, I got lucky and discovered that writing was right for me.

I could have saved myself a lot of grief and time if I could have read Getting Unstuck: How Dead Ends Become New Paths by Timothy Butler like 30 years in advance of publication. Butler, a Senior Fellow and Director of Career Development Programs at Harvard Business School, has created the best hands-on guide I've seen to dealing with impasse -- that experience of coming to a dead end in your career or life.

It was actually a relief for me to learn that impasse was such a common experience. But because I've always tended to jump ship when I find myself in that position, I've often wondered if I was making a mistake, that if I had stayed the course I might have achieved some greater success. So, I asked Butler, "How do you tell the difference between an impasse that requires a new path and a bottleneck in a path that you should stay on?" Here's his response:

"Very interesting question. Bottlenecks can be approached and worked-through using the problem solving methods that are currently in our repertoire. When we label something a 'bottleneck' we are implicitly recognizing it as a more or less predictable disruption within the model that we are using to understand our work situation. At times of impasse, there is no recognition. We do not understand what is happening around us. Impasse arrives as a sense that we are not making full sense of our situation. It often arrives first as feelings of frustration, indifference, or self-doubt. What we do not know yet is that we are encountering more than our model, of a work or life situation, can explain. It is then that we can begin the work of the impasse-to-vision cycle."

One question: Richard C. Cook

I heard Rick Cook, author of the new book, Challenger Revealed (Thunder's Mouth Press), speak at the Williamsburg Library last Friday. I've read and even written a little about the 1986 Challenger disaster and knew that it was caused by a failure of management as much as a failure of o-rings. But Rick lived it and lived with it for the past 20 years. Now, he has also written the definitive book, which PW called a "gripping true-life thriller" no less, on the tragedy.

Rick was NASA's lead resource analyst for the shuttle's solid rocket boosters and six months before the launch, wrote the first memo warning NASA's top management of the dangers inherent in the huge o-rings that helped seal the joints between the booster sections. In the aftermath of the disaster, he re-reported this information to NASA and the Rogers Commission. When it appeared that a cover-up was in progress, Rick took his files to the New York Times. His action paved the way for Morton Thiokol's engineers to step forward with the story of the managerial pressure to approve the ill-fated launch they experienced.

In his talk at the library (Rick grew up in Williamsburg and his mom was in the audience), Rick argued that the Challenger disaster was not an accident. He says the risks were known and preventable, that the decision to launch made by NASA's management was driven by political considerations and flew in the face of known facts. That led me to ask him: Given that internal and external 'political' pressures apply to every important organizational decision, what can executives in corporations and other organizations do to avoid making the same type of error that resulted in the deaths of the Challenger's seven crew members?"

Here is his very generous and insightful response:

This is a very good question, so I have put together the following "Sixteen Lessons from the Challenger Disaster." These would seem to apply to many organizational situations, as well as to events in the news today.

Lesson One: ASSURE ADEQUATE RESOURCES. The space shuttle was chronically underfunded, both while it was being developed and later, after it began to fly, when hardware glitches should have been repaired.

Lesson Two: DESIGN IT RIGHT IN THE FIRST PLACE. NASA knew of design flaws in the solid rocket booster joints which doomed Challenger years before the shuttle ever flew. Once a flawed design is engineered into a product, it is much more difficult to change than if it is caught early-on.

Lesson Three: DON'T OVERREACH. The shuttle was supposed to fly like a scheduled airline to serve every conceivable launch need, including scientific, military, and commercial. This resulted in design compromises and excessive launch schedule pressures.

Lesson Four: TEST, TEST, TEST. The shuttle testing program was "hardware starved." The solid rocket boosters were never tested under the full range of anticipated operating conditions.

Lesson Five: INVOLVE THE USERS. NASA concealed the severity of the problems with the O-rings in the joint seals, and the degree of concern the experts had that they could fail, from the astronauts whose lives were at stake.

Lesson Six: LISTEN TO THE EXPERTS. At various stages, engineers who warned of possible disaster were ignored, told not to put it in writing, passed by for promotion, denied adequate resource support, or overruled.

Lesson Seven: STOP AND FIX IT. NASA knew years earlier that the O-ring joint wasn't working properly, and they knew for over a year that the joint was susceptible to failure in cold weather. They had designed a repair, but planned to "fly as is" for two more years while the change was being implemented.

Lesson Eight: DON'T CUT CORNERS: Largely due to cost considerations, the shuttle never had a crew escape mechanism. The Challenger crew cabin emerged from the fireball intact, and the crew might have survived if a parachute/flotation system had been in place.

Lesson Nine: BE AWARE OF WHAT CAN GO WRONG: There are many ways a complex system can fail. Conscientious management seeks out potential problems rather than assuming, hoping, or praying that everything will work as it is supposed to. NASA had cut back on its safety system even before the shuttle was declared operational.

Lesson Ten: HAVE SOME HUMILITY. It would seem to make sense that if the leading experts say not to do something and you go ahead and do it anyway, bad things could happen. What makes you think that the laws of nature don't apply to you?

Lesson Eleven: THE REWARD SYSTEM SHOULD PROMOTE, NOT DETRACT, FROM QUALITY. NASA's authoritarian culture and a reward system that emphasized "flexibility" tended to promote those who went along with the party line, rather than the ones who raised issues and insisted on substantive answers.

Lesson Twelve: TELL THE TRUTH. Deceit about the dangers of the space shuttle ran like a thread through the history of the program and the investigations which followed the disaster. The disaster was blamed on flawed "communications," when it was often a matter of simple honesty.

Lesson Thirteen: BE ABLE TO SAY "NO." The Thiokol engineers had the courage to recommend against the launch of Challenger because the O-ring joints could fail in cold temperatures. Their managers overruled them and approved of the launch following pressure from NASA officials who themselves had been pressured. Too many people caved in.

Lesson Fourteen: VALUE HUMAN LIFE. Negligence involving human life and safety is a crime. One of the astronauts' widows said that NASA showed "shockingly sparse concerns for human life."

Lesson Fifteen: TELL THE POLITICIANS TO BACK OFF. From members of Congress who wanted to ride on the shuttle, to an acting administrator eager to please, to White House figures who wanted the shuttle in orbit in time for the president's state of the union speech, the space shuttle program was suffocated by politicians who wanted attention.

Lesson Sixteen: SAY YOU'RE SORRY. After the Challenger disaster, a multi-layered cover-up was kindled to protect the management brass and the politicians. Due to the whistleblowers, some of the details became known, but it would have been much better if those in charge had simply admitted they were wrong.

If executives, managers, and employees observe these sixteen lessons, they will have a much better chance of dealing with political pressures when crunch time comes. [Copyright 2007 by Richard C. Cook]

Richard C. Cook is the author of Challenger Revealed: An Insider's Account of How the Reagan Administration Caused the Greatest Tragedy of the Space Age, called by Publisher's Weekly, "easily the most informative and important book on the disaster." He worked in the Carter White House and NASA before spending 21 years as an analyst with the US Treasury Department. He is now a writer and consultant on public policy issues and is working on a book on economic and monetary reform. Visit his website at: http://www.richardccook.com/.

One question: Steven Hiatt

I posted on the release of Berrett-Koehler's new collection, A Game as Old as Empire, a couple of weeks ago. Since then, I've gotten a chance to dip into it and found it as fresh and disturbing as today's news.

For instance, the morning after I read the chapter relating Greg Muttitt's investigation into the ongoing effort by the US gov't and Big Oil to grab Iraq's most significant source of revenue, its oil reserves which comprise 10 percent of the world's total reserves, the news broke that after much foot-dragging the Iraq cabinet had approved the draft of a national oil law that would open the way for foreign investment in and control over their reserves for the first time since the 1970s. The stories in the news barely mentioned this important fact and said nothing about its ramifications, focusing instead on how the law apportions the reserves among Iraq's regions.

Each chapter in A Game as Old as Empire exposes new strands in what editor Steven Hiatt portrays as a 'web of control' spun by Western governments, corporations, financiers...in fact, the largest and most powerful institutions on earth, all aimed at looting the Third World. I wondered why they had come together in this way and asked editor Steven Hiatt this question: As you collected all of these pieces and fit them together, did you find that the players were all in the game for different reasons or do they share common motivators and goals; in other words, what are the primary drivers in this game?

Here's his answer:

"Perhaps the key principle is the quote from Hannah Arendt that I used to open my chapter: "A never-ending accumulation of property must be based on a never-ending accumulation of power." Another take would be one familiar to the analysis of financial markets: the drivers are greed and fear. In that sense, their motivations are similar, even though their perspectives may differ because of they occupy different positions in national and global structures of power. We might describe global elites--those who circulate among the top government, corporate, and other institutions--as constantly balancing the reality of competition with each other with the advantages of collusion. Jeff Faux's The
Global Class War provides a fine account of what he calls "the part of Davos."

For example, suppose you're the head of the US Export-Import Bank, the US export credit agency. Your job is increase the exports/ contracts of major corporations like Boeing, Bechtel, and General Electric. The political aspect is that these contracts will result in jobs and investment in the US and help the administration and politicos in impacted districts and states. Power thus comes from increased business and profits, coin that can be turned into political power. The fear aspect is the mirror image: suppose the contracts, and the profits, go to Airbus, China Harbor, and Siemens? There's an institutional aspect, as well. You don't get far as head of an ECA by reducing your support for local industry: Success is defined as more exports, more contracts, more money, more power. If you don't understand the game or want to play it, you'll be replaced by someone who will. And power is very seductive: if you're newly arrived at these heights, you don't want to give it up. If you've inherited a place at this particular table, you look on it as simply what you're entitled to.

There are also geopolitical drivers--for example, the struggle to ensure access to energy supplies and other raw materials (as well as the struggle to control them to ensure leverage on other countries; see numerous US policy statements on the importance of US primacy in the Middle East going back to 1944). Again, on an institutional level, you don't succeed in the security services or the foreign policy establishment by giving up power and advantage.

Of course, there are differences of opinion among elites about the best course of action. George W. Bush and Dick Cheney believe, it is said, that the sooner the Battle of Armageddon is fought in the Middle East, the sooner the Messiah will return to reclaim His heavenly kingdom. This is decidedly a minority taste. To take another example, some corporate and government leaders, faced with the evidence of global warming, have pushed the longer-term health of the global economy/society, while others, influenced by ideological blinkers or a more precarious position in the market, take only the shortest term view of profit maximization.

Corporate globalization has brought the collusion aspect of the relationship among global elites to the fore. The World Trade Organization and NAFTA were admittedly designed to take most economic matters out of democratic debate and decision making, for example, settling trade issues by secret tribunals through a system riddled with conflicts of interest. As Alasdair Spark, asked, in defense of international elite conclaves such as Davos and Bilderberg, "Shouldn't we expect that the rich and the powerful organize things in their own interests. It's called capitalism."

But, we might, ask: what about the rest of us—the 6.5 billion of the non-elite inhabitants of the planet?"

You can read an excerpt from the book here. Also, somehow I ended up with two extra copies of the book. I'm giving them away to the first two people who email me at businessreader@gmail.com. Include your mailing address, in the U.S. only please.