A Leadership Ethics Lesson Courtesy of a Leeson

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Although ethical behavior in business is often touted, it can be hard to attain in practice. That’s because ethical behavior has to be practiced by every individual, every day. It’s not the sort of thing that can be decided upon and implemented en masse. Leaders are often under particular pressure to be practical over ethical. The reasoning is often because hard decisions require frequent compromise, and ethics often come across as black-and-white perspectives that don’t match the reality facing a decision-maker.

A Virtue You Can’t Afford to Ignore

However, ignoring ethics can be a dangerous path. Nick Leeson provides a very vivid example of this. His name is well known in financial circles as the man who single-handedly put the Singapore financial markets into a panic and brought down one of Britain’s most famous banks.

Leeson got his start early in banking as a clerk in 1985. At first, Leeson seemed to be a success. However, he began quickly playing outside the rules, and because he was bringing in big profits, Barings Bank ignored the risks.

By 1992, trades started going bad. Leeson packed the losses into a technical account originally designed as a dummy account for accounting errors. No one noticed, so he continued on his unethical path of hiding losses repeatedly. The tipping point came in January 1995 when Leeson placed a big trade between the Singapore and Japanese markets. Not expecting a major earthquake in Japan to throw both markets into a tailspin, Leeson realized the gig was up and went into hiding. Barings Bank folded a few weeks later owing £827 million in losses, and eventually, Leeson went to prison.

Actions Speak Louder Than Words

Interestingly, following good ethics not only avoids situations like Leeson’s, but it also works as a defense for a business leader. The adage, “actions speak louder than words” is true for ethics as well. Ethical behavior not only keeps employees behaving on the right side of the law, but it also gives managers and leaders incentive to work for more than just the bottom line. Ethics can incorporate greater goodwill for the community a business operates in, safety protection of employees and customers, market protection from unscrupulous players, and far better interaction with the government and regulators. All of which, in turn, help a company see a larger bottom line.

No question, the ethical path isn’t always the easiest. However, leaders of companies and organizations need to remember that good ethics involve more than just an individual perspective; by the very nature of their role, top managers affect all of the organization and set an example for staff to follow and the community to model after. Good ethics can be far more than just a set of rules; it can be a powerful marketing/communication tool positively setting a business apart in the market from competitors and creating the long-term foundation for customer retention.

Bad Habits

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An elderly scholar got a request from a wealthy man to help wean his son of bad habits. The scholar agreed to visit his son. The old man took the boy for a stroll through some nearby gardens. Suddenly, the man stopped and asked the boy to pull out some small weeds. The boy reached down and effortlessly pulled the weed from the ground. They walked a little further, and the man asked the boy to pull out a larger weed. The boy pulled harder, and the plant came out with its roots attached. “Now pull that one,” the man said as he pointed to a small bush. The boy pulled with considerable effort, and the bush finally came out.

“Lastly, I’d like to pull out that tree,” he said as he pointed to a large established tree. The boy grabbed the trunk and pulled with all his might for several minutes, but it wouldn’t budge. “It’s impossible,” the boy replied. “So it is with bad habits,” the scholar replied. “When they are young, it’s easy to pull them out, but once they take hold, it’s very difficult to uproot them.”

Here the way I see it: Don’t wait for bad habits to grow into a big problem. Drop them while you can still manage them, or they will take control of you.

Leadership Sometimes Means Showing You’re Human

ThinkstockPhotos-530489960Mary Barra, the CEO of General Motors, has seen her share of tough times. She took on the CEO mantle as one of the first female company leaders in the auto industry, only to get slapped with a faulty auto ignition switch recall.

Barra had already done her time in the trenches while going through the GM bankruptcy in 2009. However, when Barra faced down her first big CEO challenge with an ignition switch that was being attributed with killing consumers, she did something no one expected – she apologized.

The Road That Leads to Trust

Barra’s apology rang the auto industry like a deep bell of the apocalypse. Everyone heard it, everyone saw it on TV, and everyone was in shock. Her apology wasn’t the end of the matter, of course. She had to go through multiple congressional hearings, fire managers and engineers she had known and trusted for years, and put the reins on employees to turn the company around. But her leadership was and continues to be rooted in a basic, inherent level of decency to do the right thing. To this day, Barra’s choice to take the harder road has been remembered as well as solidified her as GM’s CEO for a good number of years to come.

Company leaders only get a few opportunities to define themselves and lead the company through a major challenge. After that the die is cast with regards to overall confidence in the leader’s capabilities. Those who succeed gain the invaluable loyalty of staff and supporters through far more challenges in the future because trust is solidified. Those who fail usually see their support begin to erode and, after a few years, have to start planning an exit unless they produce some major new revenues or get lucky.

The Humanness Factor

The success of a leader, as Barra’s example has shown, is rooted in humanness, the ability to come across as a real person. CEOs and leaders often get a bad rap for being distanced from the working floor and aloof from the problems of the average person. Their higher salaries and compensation don’t help matters either. Barra’s apology, however, shows how a CEO can cross such perception barriers and be the right person for the job when it counts. When people need to see someone take responsibility to move things in the right direction they look to a known leader commodity. If that person fails at that moment to be decisive, people then begin to fall away and worry about their personal stake. That can drive away extremely important people assets and potentially kill a company.

Granted, the first thing an attorney will advise is to admit nothing, and tow the party line. However, as Barra has shown, society does forgive serious mistakes if they can trust those in charge.

A City Built 900 Years Ago Can Teach Us a Business Lesson Today

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Between the years 800 A.D. and 1130 A.D. something amazing happened in northwestern New Mexico. Without wagons or horses, no metal tools, and before the arrival of Columbus in 1492 or prairie tribes regularly migrated across the plains, a city existed in a place called Chaco Canyon. This small city (and the network of buildings and hubs) created architecture as high as five stories with trade networks stretching down deep into tropical Mexico. It was inhabited year round and included storage, ovens, living quarters, and plenty of protection from the high desert winter (the elevation is above 7,000 feet in most areas). Most amazing, the architecture involved using load-bearing timbers placed with an experienced eye and allowing multiple-level building structures made of three-feet-thick stacked, stone slab. It was not an accident how this ancient city was built and sustained.

Pressing On

The persistence of the ancient Chaco Canyon residents is an even more surprising fact. Many of the timbers and logs involved in the construction of the homes came from far away. The typical plant growth in the area of Chaco is essentially shrub brush and desert flora. There are no trees or forests. Further, the entire Canyon area is surrounded by mesas that are easily five to ten stories high. They are not at an easily climbed elevation out of the Canyon. In fact, the only flat exit out of the Canyon area is to the south, miles away. So how did all the timbers get there in the first place? Persistence. The residents of Chaco walked the timbers from up to 75 miles away from where trees and forest grew. Without horses, wagons, or any easy transportation, the residents of Chaco walked and imported every building material from the outer region fifty to one hundred miles away.

Businesses today are often swamped with offers and promises that the next big technology, motivational program, computer hardware, commercial vehicle, or transportation plan will transform their company and produce huge new market rewards. While there’s plenty of sales language involved, the real fuel that helps businesses break through challenges and grow more is pure, old-fashioned persistence. Things are easy when the elements of business are cooperating; what matters is what helps the business sustain itself and continue to succeed when times are tough.

Look Beyond Your Resources

Persistence is a skill that intelligently keeps things going when resistance occurs and requires smart thinking and ingenuity. Managers and leaders are frequently faced with problems and not enough resources; it’s rare that a business leader gets to deal with a problem with the ideal amount of resources available. However, persistence shouldn’t be confused with being stubborn and banging one’s head against a wall needlessly. Persistence is focused but also capable of being redirected to work around an obstacle instead of only through it.

The people of Chaco Canyon are long gone, having stopped building their city by 1130 A.D. likely due to a serious drought and lack of any more resources being available. However, what they did produce for 300 years required consistent dedication in extreme conditions. Business leaders can take a lesson from history in what these early people accomplished. They figured out how to solve a problem and thrive in a desert environment that would otherwise work against them. Managers and company owners have to find a way to get above the weeds when faced with problems and define clear paths. It’s not easy, but persistence is what makes the impossible very possible.

The Amazing Power of Peer Pressure in Groups

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When Stanley’s daughter was about five and a half, it was time for her to pick out her first bike. No surprise, she wanted something with bold colors and controls. The typical child bicycle for girls was frequently some kind of flowery motif, a princess bike, or a fairy theme. However, when Stanley brought his daughter to the store, he made a point to tell her she could pick any bike in the store for her size. And she chose a bold, fire-engine red Transformers bike for her favorite TV robot heroes. Stanley wasn’t sure about the pick and asked her again if his daughter was sure. She looked around and within ten seconds was done; it would be the Transformers bike without question. So, that’s the bike she got.

A month later Stanley’s daughter went with her sister to the local park. They were back within minutes, and the younger one was crying. Stanley asked them what happened and, between sobs and hiccuping, his younger daughter blurted out she had been picked on for riding a boy’s bike. The culprit was other neighborhood kids, particularly girls. Stanley’s daughter rolled her Transformer’s bike into the garage, laid it down, and ran inside sobbing. That was the last time she ever rode that bike again. Stanley tried to see if she would ride it again a month later, but no luck. The bike ended up going to charity.

Every day at work people face decisions that they must then put in front of others, their peers. Like Stanley’s daughter, they will meet people who will criticize and oppose actions or directions chosen. Sometimes it’s for technical reasons and sometimes they do it just to be a pain. However, those peer pressure decisions can be immense depending where one is in their career. If starting out, and the opinion comes from more experienced peers, the pressure can have a huge effect on how people try to fit in, even causing anxiety in some folks. Everybody at some point wants to be accepted, and at work, it can be a fundamental requirement to gel with the “team.”

How one deals with peer pressure and compensates for it will dictate how capable of a decision-maker he or she can be. While it would be easy to assume things are top-down, dictatorial, in reality, our decision-making is often an interactive, communal function, so influence matters tremendously. Realizing this and learning how to control the pressure separates good decision-makers from those who can only operate in a vacuum. Controlling it versus being controlled means one rides their “bike” instead of losing it under pressure.

People are fundamentally social creatures, so those who want to be decision-makers need to understand how to use social influence to their advantage, not disadvantage. The last place a decision-maker wants to be is being second guessed or shamed in public when pushing a proposal. Part of effective leadership is knowing how to influence ahead of time and build decision support before the decision actually has to be made. Some call it being “political,” but realistically, effective leadership involves performance with a team, not against it.

Goals are Not Just for Sports

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In school and at work, we are often told to create goals and to strive to reach them. After all, achieving our goals is a measure of success and a method of how to pursue our dreams. Goals are a big part of managing marketing and sales in most companies, and they are the markers of who is producing and who is not. Not everyone has the same training in hitting goals, however, nor do goals create motivation for everyone.

What Can We Learn from Goals in Sports?

The easiest way to demonstrate goal setting is to look at sports. Every sport has a goal to reach to win the game. Goals can be achieved through hitting a ball out of the park, into a net, throwing it into a basket, or even by racing to a finish line. Most of these goals are made from years of preparation, training, and study of the game they represent. No athlete achieves success without that training, no matter how easy the achievement looks to the spectator. Athletes work through injuries, bad days, failures, and practice. Achievements are the culmination of hours and hours of work.

Obstacles

The point of a goal is to help you achieve success even with the stumbling blocks and barriers that stand before you. A goal is a guiding light to keep you on your journey or path. Henry Ford said that “Obstacles are those frightful things you see when you take your eyes off your goal.” The obstacles will always be there to keep you from making the goal. You may not have the experience, the education, or the opportunities that your peers or competitors do, however, you can still achieve your goals if you are willing to keep working towards them.

Applying Goals to Business

Like sports, business goals can be short-term or long-term. For instance, you can have a goal of getting ten items completed by the end of your work day. That is a short-term goal. A long-term goal is establishing 100 new customer accounts by the end of the year. An even longer-term goal is becoming the top business in your category in the city by 2020. The key is establishing goals that are reachable, measurable, and trackable so that you can follow your progress as you work towards the goal.

While wanting to be the best business in the city by 2020 is possible, a more reasonable goal is to triple your income from your business by 2020. With this goal, you can create the steps that will lead to the goal, and measure your progress as you continue your journey. You will know when you hit your goal by the numbers you achieve without any arbitrary or ambiguous measurements.

How to Keep Your Goals in the Forefront of Your Mind

Weekly meetings to keep everyone on your team on track may be boring, but their function is to make sure the team members are still striving towards group goals. You can do the same with your personal business goals. Remind yourself daily what goals you are working towards and what you need to accomplish that day to move in the right direction. Remember that keeping your eyes on the goal will help to remove the obstacles.

Sharing the Challenge Means Sharing the Victory: The Two-Way Street of Team Leadership

Sharing the Challenge Means Sharing the Victory: The Two-Way Street of Team Leadership

 

Many people work their entire lives to achieve a leadership role within an organization. They’ve put in their time, tirelessly working their way up through the ranks and then, it finally happens: they’re trusted enough to be given the responsibility of bringing a team together for the benefit of a business’s long-term goals. And yet, unfortunately, far too many people tend to veer off course with this almost immediately by assuming that respect is a given (which we’ve talked in detail about before), and by looking at “the team” as one thing and the “team leader” as something separate. They’re not separate, and they never were. The sooner this is understood, the sooner you’ll be generating the types of results you were after.

There IS an “I” in Team – It’s Just Silent

An old saying has told us for years that “there is no ‘I’ in ‘team'”, meaning that in order to become a successful, respected leader, you have to put aside your own needs and look at yourself as just one part of a larger whole. While this is certainly true, from the perspective of a leader there actually IS a pretty important “I” in team. It’s just that most people use it incorrectly.

As a leader, you don’t lead by delegating authority or even by simply demanding excellence from those around you. You lead by example. You always have (whether you realize it or not) and you always will. You set the tone for everything that happens. Think about it – if you like to joke around throughout the work day, your team members will probably joke around a bit, too. If you like to keep things a bit more on the serious side, the mood of your team members will reflect that.

This is a clear-cut example of the two-way street of team leadership, and it is one you NEED to know how to use to your advantage. Never, under any circumstances, should you ask something of your employees that you would be unwilling to do yourself. Don’t say to your new graphic designer, Timothy, “Hey, we’re a bit behind on this upcoming project and I need you to come in on the weekend.” Instead, say, “Hey, so that we can get caught up, I’m going to be coming in on the weekend and I would really appreciate it if you could find the time to as well.” This goes above and beyond just showing your team members that they’re appreciated. It lets them know that you’re not JUST the team leader, you’re a part of the team as well. Of course, you might not always be able to come in on the weekend yourself, but showing your willingness is more of the idea here.

Pay attention to the way this idea plays out in visual cues, as well. If you want your employees to dress more professionally in the office, don’t call them together and reprimand them for their current appearance while you’re wearing beach shorts and flip-flops. Doing so will end in slowly chipping away at that high-functioning team you worked so hard to build in the first place. If you show up every day at the office dressed in a suit and tie, just watch how your employees will rise to meet your dress code.

A Team Shares EVERYTHING

This idea also plays out in how you celebrate your accomplishments or lack thereof. By making yourself a more ingrained part of the team and sharing the challenges, it means that you truly get to share in the victories as well. Remember – you don’t work in a vacuum. When a project finishes successfully, people may want to give you the credit because “you told the right people to do the right things.” You didn’t. Never forget that you’re just one small part of a larger whole. If you were willing to share the challenges, you have to share the victories as well – this means that any success is the TEAM’S success, not yours.

In the end, the phrase “team leader” is actually something of a misnomer. People tend to think of it as immediately positive – you’re in a position of authority and that is something to be celebrated. While this may be true, it’s also something that can be far too easily abused – even unintentionally – if you’re not careful. If a chain (or team) is only as strong as its weakest link, you need to understand that the weakest link will ALWAYS be the team leader by default. Your number one priority is making sure that the entire team is moving forward through the way you treat your team members, the way you behave, and the way you show them that you’re all in this together.