management blog

The appalling scenes at the Smolensk air crash over the weekend have stunned European onlookers, and doubtless many more people beyond. It is far too early to know precisely what happened, although reports of unheeded warnings from Russian air traffic controllers are beginning to emerge.

Air disasters are inevitably a macabre subject. Understandably, frequent fliers find them troubling.

Daniel Goleman first pointed to the crucial management issues at the heart of air disasters many years ago in his ground-breaking work on Emotional Intelligence. Why did Australian flight crews have such an enviable safety record? Was is it because of their lack of artificial deference, and the ability even junior staff had to speak up and warn of danger? Which flight crews could be the most dangerous? The ones where macho pilots could not or would not listen to advice, or ones where rigid hierarchy, deference and emotional chilliness led to vital messages not getting through.

The bitter and tragic ironies of the Smolensk crash are painful. Leaders of the Polish government, heading to Russia to commemorate the murder of Polish officers and others during World War Two by the Soviet military at Katyn, have now died only a few miles from the scene of the original crime. It would be distasteful at this stage to speculate further on the causes of the crash. But when the evidence becomes clear so too will the all-too human factors which lay behind it.

In London we are bracing ourselves for tonight’s first big pre-election televised debate - between the three candidates to be chief finance minister (or Chancellor of the Exchequer, as we call the job) after the election: Alistair Darling (incumbent, Labour), George Osborne (Conservative) and Vince Cable (Liberal Democrat).

All three are going to make the best of a bad job, presenting partial or distorted information to make their case. That is not surprising. They are politicians, after all.

But what if you were interviewing candidates for the position of chief financial officer at a public company? Wouldn’t you want them to have a firm grasp of the facts?

In the wake of the financial crisis, politicians have been quick to criticise reckless bankers and others who failed to keep proper control of their businesses. But when politicians practise their own version of “business as usual”, the results are not pretty. Maybe our elected representatives would be respected and trusted more if they were prepared to speak more plainly, honestly and accurately about the state of the nation’s finances.

An interesting little snippet of information here from Marketing Week. According to data from the pollster YouGov, British Airways’ brand has suffered less from the recent strike than from the calamitous opening of Heathrow’s Terminal 5 two years ago.

It seems that management’s self-inflicted wounds can be deeper than those caused by striking workers.

I had the great pleasure of catching up with Dov Seidman this morning, when he came into the FT’s offices to meet me and my colleague John Plender. Dov is a remarkable guy. He has degrees by the armful: bachelor’s and master’s in philosophy from UCLA, PPE from Oxford – followed by Harvard Law School. All this after wrestling with dyslexia as a child.

He is an entreprenuer with ideals. He founded LRN, his consultancy, 15 years ago, to pursue his belief that businesses needed to adopt an ethical approach. But he managed to write a successful book on the subject, How, in 2007, without banging on endlessly about ethics. LRN now has around 300 employees worldwide, and has an impressive list of corporate clients.

Dov is different – free-thinking and original. He is a Davos regular, and is much quoted by the New York Times’ Tom Friedman (and me). Today we had a vigorous hour-long conversation, during which time he raised any number of interesting and important points. Here are two of them:

Two big industrial disputes have erupted in Britain today. First, talks between British Airways and the Unite trade union broke down, meaning that this weekend’s strike on BA seems almost certain to go ahead. Second, the Rail, Maritime and Transport (RMT) union announced that signal-workers on the railway have voted, by a small majority, to go on strike as well.

The only frustration for newspaper headline writers is that, since spring has finally burst into life this week, these two strikes cannot be characterised as constituting a “winter of discontent”. But it is an opportunity to ask if the so-called British disease – industrial unrest – has reappeared.

Upsetting news in from Milan last night, where the English soccer superstar David Beckham tore his Achilles tendon, almost certainly putting him out of this summer’s World Cup.

At the age of 34 Beckham is clearly not quite the player he was. It seems unlikely that the England boss Fabio Capello would have picked Beckham to start matches in his ideal first eleven. But his presence in the squad would have lifted his fellow players. And he was likely to make several appearances coming on to the pitch from the substitutes’ bench. He remains a brilliant crosser of the ball, and can still deliver a deadly free-kick.

Optimistic English football fans – there are a few out there – will console themselves with the thought that, in 1966, England won the World Cup without the apparently irreplaceable Jimmy Greaves playing in the latter stages.

There may be another reason for the optimists to reinforce their sunny outlook. Football, obviously, is a team game. Individuals have to step up and take responsibility, playing complementary roles. There is no time to look wistfully over to the substitutes’ bench waiting for the saviour Becks to work his magic, as he did at Old Trafford in 2001 and Sapporo in 2002.

No: the players who are on the pitch will have to do the job. There will be no David Beckham (or Michael Owen, for that matter) to rely on. What an opportunity for the next generation of players to grab. All they have to do now is beat Brazil or Spain and the cup’s theirs!

You may have missed this story by my colleague Jonathan Soble in Tokyo last week. The basic thrust of it is that employee representatives at Toyota had informed senior management in 2006 that they were concerned about falling quality at the company. “We fear that processes vital to safe automaking have been cast aside in the name of competitiveness,” one union leader said.

It is true that this leader came from the “All Toyota Labour Union”, a break-away from the more established in-house union. But this story tells us two things. First, listening to employees (consultation) may take time but can save you from greater problems in due course. And second, staff associations or “approved” unions, while more polite and restrained, may not give you the independent feedback managers sometimes need.

Last month I wrote in this blog: “I expect that, down on the production line, Toyota employees could see exactly what was going on. That is the Toyota way.”

I am glad that, in this sense at least, my faith in the company has been confirmed.

Tricky things, partnerships. Their great advantage is that you have to proceed by consensus if you want to get anything done. Their great disadvantage is that you have to proceed by consensus to get…

An interesting letter appeared in this paper today from Ashley Unwin, a partner at PwC. Mr Unwin was responding to a report from the Management Consultancies Association, which stated that consultants are, by and large, doing good work that represents value for money.

But Mr Unwin wants to go further. Firms should consider accepting fees based on “realised value” – that is, tangible, measurable results. This has been talked about for some time, but is practised only rarely. Before joining PwC Mr Unwin worked for the private equity group Terra Firma, where he was a managing director, and spent 18 months at EMI (seems to be the average tenure there these days).

His letter ended with this challenging kicker: “It remains to be seen whether any firm is brave enough to adopt this [approach], ours included.” [My italics] Might there be some lively conversations going on at Embankment Place just now, d’you think?

So the charming and energetic Elio Leoni-Sceti is leaving EMI at the end of the month, to be replaced by new executive chairman Charles Allen. I met Mr Leoni-Sceti at the FT’s innovation conference in London last year, where he gave an impressive presentation. He seemed to have grasped how serious EMI’s problems were, and how radical the company needed to be if it wanted to recover. He was full of interesting, revenue-generating ideas about how an old media company could transform itself into a new media one.

The UK’s Association for Graduate Recruiters has published a pre-election “manifesto” today, which argues, among other things, that the government’s drive to get 50 per cent of all under 30s to go into higher education should be abandoned. The AGR has repeated some now familiar concerns about falling standards, and university degrees of dubious quality.

Recruiters are right to be concerned about the quality of graduates they are hiring. It would be a worry if students are emerging from three years at university deeply in debt but only imperfectly educated. In my experience, employers are usually at least as concerned about new recruits’ attitude to work and “job-readiness”, as well as their academic qualifications.

All the same, while the AGR’s forceful comments have won them some publicity, it seems odd to send a message to the nation’s young that higher education may not be for them. What sort of future labour market does the AGR expect to see young people entering? Should we really be bracing ourselves for a lower skilled, less well educated future? Is that what young people in China and India are being told?