Business Week ran an article last month (July 10, 2006) on corporations that make a point of learning from their mistakes, and the list is shorter than one might expect. The profit motive apparently is not the sure prod to diligence that the textbooks assume. At most companies the instinct is to bury mistakes because the boss doesn’t want to hear bad news.
Smart executives, by contrast, seek it out. “They try to prove themselves wrong” the way scientists do, Business Week observes. “That focus on potential flaws makes failure, and the lessons that come with it, happen earlier.”
This commitment to learn and grow leads to cultures that are open. People don’t sweep inconvenient facts under the rug; the front office wants to hear what it is doing wrong. The result is a feedback loop that helps ensure that problems are addressed. Franklin Roosevelt famously ran his White House that way. He had back channel sources throughout the federal bureaucracy, so that he could double check what his top officials were telling him. He often gave assignments to two different cabinet members – preferably rivals – so that each would serve as a kind of truth check on the other.
This is not the mode of operation in the current White House. To the contrary, President Bush is a closed code man. He has arranged his Administration so he hears only what he wants to believe. People who stay on message win favor and promotion – cf Condoleeza Rice, who is fastened on-message with iron bolts. The only way to get fired it seems is to tell an off-message truth, as did Paul O’Neil, Bush’s first Treasury Secretary, Lawrence Lindsey, his first top economic advisor, and a host of others.
This is not a partisan view by the way. Candid Republicans say the same. As Joe Scarborough, a former Republican Congressman put it recently, the President “detests dissent, embraces a narrow world view and is intellectually incurious.” Maybe it is not accidental that Bush was a chronic failure in business, until he helped persuade local taxpayers to subsidize a new stadium for his Texas Rangers baseball team. Markets are essentially feedback loops; and those who do not accept unflattering feedback are not likely to do well.
But now it’s the whole country, even the whole world, that are trapped in the president’s self-affirming cocoon. Bush is turning the entire federal government into an extension of himself in this regard. If it refutes what he wants to believe then he doesn’t want to hear it, and he doesn’t want the rest of us to hear it either. Vice President Cheney, who plays expertly to the President’s cloistered psyche (in part because he shares it), set up his own “intelligence” operation within the Pentagon, to tell him what he wanted to hear about Iraq. Now he’s getting the same about Iran; and it’s no mystery where he wants to go with it.
The natural environment is another case. I’ve written here before of how the Administration has banned the term “climate change.” In the bureaucracy they are supposed to say “natural climate variability” instead. The EPA libraries are being closed, so that citizens won’t have access to the facts, and will have to rely on White House messaging instead, the way the President himself does. It’s getting worse. Bush actually is closing down the programs at the National Aeronautics and Space Administration that gather climate data in the first place.
Here are a few paragraphs from a recent report in the Boston Globe (June 9, 2006):
NASA is canceling or delaying a number of satellites designed to give scientists critical information on the earth’s changing climate and environment.
The space agency has shelved a $200 million satellite mission headed by a Massachusetts Institute of Technology professor that was designed to measure soil moisture, a key factor in helping scientists understand the impact of global warming and predict droughts and floods. The deep Space Climate Observatory, intended to observe climate factors such as solar radiation, ozone, clouds, and water vapor more comprehensively than existing satellites , also has been cancelled.
Almost every planned earth-studying mission, all that have some contribution to understanding global warming, has been affected. The $100 million Deep Space Climate Observatory, already built, was canceled earlier this year. First proposed by then-Vice President Al Gore in the 1990s, the satellite was planned to give researchers a continuous picture of the sunlit surface of the earth and allow the first direct measurements of how much sunlight is absorbed and emitted, key information that could serve as an indicator of global warming.
Don’t seek standpoints broader than your own because what you learn might be troubling, the Bush people are saying. If the facts disturb you, fire the fact-gatherers, pull the covers over your head, and pretend the problem isn’t there. Closed systems such as this practically ensure failure. (Look at the economy of the former Soviet Union.) The wisdom of open ones is that you find out what you need to, messy and painful as the process might be.
The tendency to close the loop runs deep in corporate America. In the same issue of Business Week as the article on learning from mistakes, there is a column by Jack and Suzy Welch in which the two opine on the question of of opening up the company books to employees, so they can see how their own efforts affect the bottom line. (Jack is of course the former CEO of General Electric; Suzy is the former Harvard Business Review editor he left his wife for.)
Sometimes more openness works, they say. But then they add this caution: “[A]re you sure you’re comfortable with the team knowing how much the business makes? They will, naturally, compare that number with what they make, and eventually they will be able to extrapolate how much of the pie you have – and they don’t.”
In other words, the workers might realize that you are ripping them off. It might be better to keep them in the dark. This is coming, let’s not forget, from a man who despite his substantial fortune was living pretty much at GE’s expense, under a retirement agreement that was not disclosed until his jilted wife forced it into the open. The publicity and resulting embarrassment led to a change in that kept-man arrangement.
It’s not surprising the people in the corner offices like to keep things close to the chest. What we don’t know we can’t get riled up about. Sometimes that might even be the best policy. But it’s not a way to run a country – nor a corporation either, it often turns out.