Do take a quick look at our regular Judgment Call feature from Wednesday’s paper. It’s a particularly good one, even if we say so ourselves.

We have sharp contributions from four distinguished commentators: Harvard Business School’s Rakesh Khurana, Rotman’s Roger Martin, Kai Peters from Ashridge and Jim O’Toole from the University of Denver.

We have asked them how good a job business schools are doing in providing an ethical education to their students. Their overall verdict: probably not good enough.

But I am over-simplifying their answers, which are worth reading in full.

Is strategy dead? Chief strategy officers will deny it. Some strategy consultants may reject the idea, too. But, right now, markets are unpredictable. The economic outlook is uncertain. The world has changed. If old-style strategy formulation is not exactly dead, then it is hardly in the best of health.

For months, many leadership teams have had only one strategic goal in mind: survival. Grander visions have been filed away or forgotten. This hedgehog-style approach – roll up into a ball and wait until things are less scary – may keep a company alive temporarily, but does little to prepare it for the future.

Analysis by Boston Consulting Group suggests that corporate hibernation only works if recessions are short, if the outside world goes back to the way it was before, and if all your competitors are equally inactive, tucked up for the economic winter. In 2009, not one of these conditions applies.

The remainder of this article can be read here. Please post comments below

England football manager Fabio Capello has had a remarkably successful career in Italy, Spain and now as manager of England (ok, he hasn’t won anything yet, but they have qualified for the World Cup). Sports analogies are used too often in the world of management speak (even for a sportsfan like me) but according to an article in the Guardian about his presentation at the Global Sports Summit in London, Capello reveals a couple of interesting truths.

First, he says that when he took over England the quality of the players was very high in training but not in matches.

“I understood everything when they played Switzerland in the first match, the same players who played well in training played with fear, with no confidence, and I said this is a big problem of the mind,” he said. “Step by step, game after game, we have improved a lot.”

Continue reading "Fabio Capello on the management of fear"

The US Chamber of Commerce is still in a bit of trouble - I wrote about the problems of the US Chamber of Commerce a few weeks ago. Now the New Yorker’s James Surowiecki questions some of the organisation’s claims on how many companies it represents. He says it could have misrepresented or “lied” about numbers of members

I highly recommend today’s analysis of Banco Santander and Emilio Botín, its executive chairman, a bank that has been able to thrive when its home market and so many of its rivals have suffered so brutally in the recession. Obviously, things can change quickly in the world of business, but their steady rise from a small bank founded in the northern Spanish city of Santander into one of the world’s largest.

From a management perspective, the really striking fact is how important leadership has been to the organisation - much of its success is down to Emilio Botín, its executive chairman - and the company’s cautious approach to risk management.

One story the piece didn’t go into detail was how the bank responded when its exposure to the Bernard Madoff ponzi scheme was revealed. Rather than trying to cover it up, they were open about it and quickly offered compensation to their clients. Not only was this a good example of handling customer relations (apparently 70 per cent of its “Madoff” customers took up the offer) it was also a brilliant communications effort. This could have been a major stakeholder relations disaster for the bank, but by dealing with it in a forthright manner, it seems they were able to minimise as best they could the damage.

I watch with semi-detachment the energetic manoeuvrings of entrepreneurs and executives around the world of politics. Why do businessmen (and women) strive so hard to get close to ministers and political parties? Do they have public service in mind? A deep urge to be at the centre of things? Or do they think such influence can benefit their commercial interests? Perhaps they just want a knighthood or a peerage as a bauble, the next achievement in their career plan? How many have unadulterated motives?

My six years at Channel 4, a public corporation controlled by the state, have made me jaded when it comes to seeing government in action. Ministers come and go, while civil servants try their best, but the system is flawed: legislation appears to be a process of petty ritual, procrastination and compromise. Politicians seem obsessed about staying in power and keeping their seats, often to the exclusion of the noble intentions they once had. Everything takes far too long, decisions are watered down, and fear of negative publicity infects the entire circus. Meanwhile, state control too often means the malign influence of regressive trade unions, and perverse incentives.

The remainder of this article can be read here. Please post comments below.

Dame Anne Owers, the Chief Inspector of Prisons for England and Wales, said today that a number of prison managers had moved out “difficult” inmates because they were worried that their presence would negatively impact their inspection.

It seemed especially farcical because, apparently, it would have had no impact if the prisoners had stayed.

“The presence of those prisoners wouldn’t have affected our inspectors assessment at all,” said Dame Anne.

“Sadly for the many staff and managers who had worked hard to improve the two prisons, their efforts will inevitably be overshadowed by these events,” she said.

“This is deplorable, not only because of the effects on individuals, but because of the underlying mind-set that prisoners are merely pieces to be moved around the board to meet performance targets or burnish the reputation of the prison.”

What really struck me about Dame Anne’s comments was her concern that this would have a damaging impact on moral for the staff and lower level managers, and provide a negative example to them.

Continue reading "Even prison managers sometimes fiddle"

David Rubenstein, co-founder of Carlyle Group, the private equity firm, said last week that his industry ought to consider adopting a new name to describe what it does more accurately. How about “change capital”, he suggested. I am not sure that this is a good idea. If Mr Rubenstein thinks the word change will be less provocative than private equity, then he is likely to be disappointed.

Change is everywhere in business, and people tend not to be very happy about it. But it is not just nostalgia, or laziness, that causes the negative reaction. Change is rarely managed well.

What do managers get wrong about change? There is quite a long list. They underestimate how long it will take to get people to accept change. They fail to recognise how difficult it is to spread the message that change may be necessary or unavoidable. They do not understand what change feels like beyond the boardroom or the top management table. And, having finally got the organisation to accept the need for change, they forget to explain that the new direction or mission may change again, and possibly quite soon.

The remainder of this article can be read here. Please post comments below