Trustworthy Leader http://www.trustworthyleader.org www.trustworthyleader.org Leading with Trust: Learning from Mistakes <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Friday, November 1, 2013<br /> <p>Becoming a trustworthy leader is a lifelong journey that starts with possessing or developing the qualities of honesty, caring, persistence and consistency in relationships. These are essential qualities to have if leader/follower relationships are to be based in trust. Trustworthy leaders also possess visionary thinking and communication skills that they use to inspire people to move forward, following the leader&rsquo;s direction.</p> <p>Leading a group of people forward is different from having people go with you because of compliance. Compliance happens when people just do their job, are uninspired by the mission, are motivated simply by the paycheck, or are so worn out by politicking that compliance becomes their best choice.&nbsp; Compliance is not what employees aspire to, yet what they may fall into.</p> <p>People follow trustworthy leaders out of commitment. When leaders help employees to see how their own work contributes to the mission of the organization they are able to more fully commit to that work. When leaders convey their overall vision to employees, a high trust, highly committed organization can be created.</p> <p>This distinction between compliance and commitment is useful for understanding how some people become great leaders while others run growing, yet uninspiring, companies. In my experience researching great leaders and the qualities that distinguish them from average leaders I&rsquo;ve seen that the ability to inspire commitment rather than compliance is a key differentiator.</p> <p>A leader&rsquo;s ability to connect people with a powerful mission and vision, and to embody the mission and vision in action, motivates people to commit.&nbsp; Actions that are based in the qualities of trustworthiness link people&rsquo;s commitment to the organization with their trust in the leader.</p> <h3>Creating Commitment</h3> <p>Most people are trustworthy. We trust our friends because over time we&rsquo;ve learned that they are worthy of our trust.&nbsp; We&rsquo;re confident that the promises they&rsquo;ve made to us will be kept. This same analogy applies to leaders we choose to follow. We look for evidence over time that we can trust and commit to following them.</p> <p>In the workplace, one method for determining the trustworthiness of a leader can be found in her approach to learning from mistakes. The best way to learn from mistakes is by acknowledging the mistake, examining what happened, evaluating options, and then trying again. When this occurs a follower can see the leader&rsquo;s learning process, and can also see if that same learning process is supported for others. If employees make mistakes are they also encouraged to acknowledge, examine, evaluate and try again?</p> <p>An organization in which learning from mistakes in a constructive way is the norm will be an organization where people openly share ideas and listen to critiques, for the betterment of the whole. A leader who shares stories with employees, colleagues and other leaders about how he has learned from his mistakes as well as the mistakes of others, will, through his honest dialogue, begin creating relationships based on commitment rather than compliance.</p> <p>These sorts of stories provide a mechanism for assessing the consistency of a leader&rsquo;s actions and words. Do the stories &ndash; that talk about constructive learning from honest mistakes &ndash; match the actions that occur within the organization? If so this can heighten an employee&rsquo;s personal commitment to the organization as a place where one&rsquo;s own growth and development is of interest to leaders. It will also encourage employees to persist in their efforts to be successful.</p> <h3>Learning at the Best</h3> <p>In my own research on what makes for trustworthy leaders I often hear leaders at Best Companies to Work For speak of their debt to mentors or former colleagues who helped them learn from mistakes by reviewing situations in which things hadn&rsquo;t gone well. The best teachers of this &lsquo;review&rsquo; learning were people who recognized their own mistakes, analyzed what happened, considered alternatives to avoid the same dilemma again, and then told the story. Telling the story was key, as this helped the mentor learn from the event each time she told the story, and helped the young leader-to-be to learn as well.</p> <p>Other teachers &ndash; of tremendous value yet where the lesson was more difficult &ndash; were people who taught about what &lsquo;not to do&rsquo; rather than by providing positive examples. These teachers were described as people who moved forward in their actions paying little heed to the damage they caused. Thankfully many people who are currently great leaders learned from the experiences they had with this second group of teachers and followed their own commitment to &lsquo;do things differently&rsquo; when they had the chance.</p> <p>I&rsquo;d like to share two stories to illustrate ways that trustworthy leaders learned from their own mistakes or the mistakes of others. These stories show how each leader used the experience to help others learn and how this has resulted in people&rsquo;s ability to follow &ndash; willingly and with commitment.</p> <h3>Scripps Health</h3> <p>Chris Van Gorder, CEO of Scripps Health, began his career as a police officer, yet left due to an on-the-job injury. His work in health care started with his first position as an emergency room clerk and then as a security guard (not at Scripps), working night shifts to support himself as he attended school. As he told the story to me, it was one night when he was doing his security rounds in the quiet halls of the hospital, that he had an encounter that would later significantly influence his own actions as a leader.</p> <p>He happened to notice that the hospital administrator was walking down the hall toward him, perhaps returning from a meeting. Chris was thinking that this could be a significant opportunity-to meet the administrator-given the unlikely possibility that he, a night security guard, would run into him again.</p> <p>He recognized the administrator by his photo, on the wall of the hospital, placed in a position of honor.&nbsp; &ldquo;I was about as low on the totem pole as you can be in my position,&rdquo; Van Gorder remembered, &ldquo;and here&rsquo;s the hospital administrator, walking down in the basement in the middle of the night. And I went, &lsquo;Wow&mdash;I am going to get a shot at meeting this guy.&rsquo;</p> <p>&ldquo;And I will never forget what happened. He walked by me as if I didn&rsquo;t even exist.&rdquo;</p> <p>As Chris told me this story, 25 years after it had happened, the emotion of that moment was palpable. Its impact on Chris&rsquo; leadership philosophy was profound.&nbsp; As he says, &ldquo;Everyone has their role and their purpose in life, and sometimes, in fact most times, the people who are out in the field doing good work are far more important than I will ever be in my position as CEO. I always try to treat people well so that they know how much I respect their hard work.&rdquo;</p> <p>The &lsquo;mistake&rsquo; that Van Gorder experienced in that moment in the hallway is unfortunately something that many people experience on a daily basis &ndash; passive lack of recognition from a leader.&nbsp; Why would anyone choose to follow that leader? A person may still do their job well, support colleagues, provide good service, and have a personal goal of doing a good job. Yet committing to the leader is not going to come out high on the list of results from an encounter like this.</p> <p>The true cost of this type of encounter is paid when a leader asks for more from employees, wants to take on a new challenge, or tries to rally people to tackle difficult issues within the organization. Without trust &ndash; and the respect that comes with it &ndash; people will not be committed to follow the leader.</p> <p>Learning from this type of an incident though is a very positive outcome. Van Gorder has done that, and many people have benefited.&nbsp; The lessons from this &lsquo;meeting that didn&rsquo;t happen&rsquo; form some of the building blocks of Van Gorder&rsquo;s personal leadership style and are used to teach others about the importance of acknowledging people, conveying respect and being trustworthy.</p> <h3>EILEEN FISHER</h3> <p>At EILEEN FISHER learning from mistakes is taken so seriously that it is included in the Leadership Principle &ldquo;Tell the Truth&rdquo;. People are asked to &lsquo;tell the truth&rsquo; in part by being open about mistakes and recognizing that in the midst of a mistake a new solution can be found.</p> <p>Leaders have placed a clear mark on this practice by directing people to learn from what they may struggle with by openly sharing their mistakes with others. &nbsp;People are invited to comment on each others work with kindness, and they are also asked to comment on their own work when the mistake is personal. &nbsp;Everyone is included &ndash; leaders and front line employees &ndash; in the notion that mistakes happen, and all can learn from them.</p> <p>Leadership principles exist in many organizations but they are not always so clearly written as those at EILEEN FISHER (EF). What do they do at EF to help people put the Leadership Principles into practice, teaching people to be comfortable with the idea that making mistakes is a learning experience? As often happens in organizations with trustworthy leaders, the learning and sharing start at the top.</p> <p>Eileen Fisher herself tells stories about the mistakes she made early in her life as an entrepreneur, emphasizing the reality that everyone makes mistakes, and everyone can learn from what goes wrong. She sees mistakes as the greatest learning opportunity people have, connecting the idea of mistakes to one of possibilities, rather than to fear or shame. She uses her own mistakes to illustrate her point of view and to be a role model to help others learn how to share.</p> <p>In the early days of the business, Eileen worked with only one fabric.&nbsp; One season while the spring deliveries were being shipped out, she began receiving phone calls from buyers saying the garments were bigger than the samples they'd seen, and the fabric felt different.&nbsp; The returns came flooding in.&nbsp; This problem put her in danger of losing the business, as she couldn't manage the returns financially by herself.&nbsp;</p> <p>Friends advised her to sue yet Eileen felt a win-win option would be better. She met with the factory owner, showed him the product compared to the samples, and they worked out a deal that made it possible for Eileen to produce her next delivery.&nbsp; They shared the expense of the mistake so neither was left in the lurch.&nbsp; In addition Eileen learned that it was too risky to work in only one fabric. &nbsp;This discovery led her to diversify into other fabrics and her business literally exploded with growth.<br /> <br /> Another mistake happened many years later, when the company was larger.&nbsp; Eileen decided to split the collection into two separate lines, EF and EF New York, creating a casual line with lower prices and an elegant line geared towards work and formalwear.&nbsp; It was a struggle to convince department stores to put the EF New York collection in the area of their stores that women shopped in for work clothes.&nbsp; Splitting the line caused department stores to split the collection and the change had a cannibalizing effect. The end customer chose to shop one or the other collection, and sales dropped.&nbsp;</p> <p>Eileen realized that this change, though well intended, actually contradicted her original design concept.&nbsp; Analyzing the steps that lead to this mistake got leaders to look back to the roots of the company and build up from what was EF&rsquo;s strength rather than trying to fill the needs of both sectors of the stores.&nbsp;</p> <p>Have either of these stories, and Eileen Fisher&rsquo;s own ability to learn from her mistakes, influenced other leaders within the organization? In 2011 when EF&rsquo;s Business Planning leader had two new employees starting around the same time, she held a special team meeting for them to focus on the big picture of the team and company, and to cover the company values.&nbsp; She began the meeting by talking about the company&rsquo;s approach to making mistakes, explaining that everyone is at EF to learn and that &ldquo;it is important to make mistakes since that's how we learn.&rdquo;&nbsp; She shared her own stories of mistakes made, and to inject some fun into the situation, she bought huge pink erasers for each team member, on which she wrote "For Really Big Mistakes!"</p> <p>****</p> <p>The stories of mistakes made, lessons learned and the success that followed, along with the humor of the pink erasers, has deepened the process of learning from mistakes that has helped EILEEN FISHER to be so successful.</p> <p>The story from Scripps Health CEO Chris Van Gorder illustrates the powerful impact that a brief encounter can have on our lives and of our ability to learn from the mistakes of others long past the time of the incident. It is also a powerful reminder to leaders that any encounter can be an opportunity to build up, or tear down, trust.</p> <p>Leaders who learn from their mistakes and share their stories will develop committed rather than compliant followers. When they ask for more from people they will have a green light rather than dragging feet. Leading with trust works.</p> <p>&nbsp;</p> <p>[This blog post is adapted from my article in the new book Trust Inc., available on <a class="text_01" title="Trust Inc." href="http://www.amazon.com/Trust-Inc-Strategies-Building-Companys/dp/1932919368" target="_blank">Amazon</a>]</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/35_Leading-with-Trust-Learning-from-Mistakes.html Is this leadership? <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Thursday, October 10, 2013<br /> <p>As I struggle to accept that the House of Representatives is fundamentally flawed in its ability to provide collective leadership to this country, i am struck by the disastrous impact of their ineffectiveness. I like many people have been stunned by the government shutdown and the apparent bubble in which Representatives go about their daily lives while others - hard working people trying to get by - suffer the consequences of Washington DC grandstanding, posturing and bloat.</p> <p>This evening i <a class="text_01" title="The impact of the shutdown" href="http://www.pbs.org/newshour/bb/nation/july-dec13/california_10-09.html" target="_blank">listened</a> to an articulate woman, working a part-time job at Walgreens, and looking forward to her first apartment, explain the impact that the shutdown has had on her. She 'lives' here in San Francisco, where I also live. I put her 'live' in quotes because right now she's staying in a homeless shelter. She could have been in her own apartment but for the lack of collective leadership in Washington DC.</p> <p>You may notice that I identify the lack of leadership in Washington as a lack of 'collective' leadership, not a lack of leadership in general. Many members of the House of Representatives have true followers in their home districts. Some of them appear to believe that that is all they have been elected to do - serve the people in their home district who believe exactly what they believe (or what politicking requires them to share publicly). Yet I believe that every elected member of the House of Representatives (and Senate) is elected for a dual purpose.</p> <p>First, these people are elected to represent the people within their district and/or state - to provide leadership so that others may follow them. And, in following these elected leaders, people's lives should become better, they will feel well represented, as if their own voices are heard in the halls of Congress. Even though not every member of a district has elected each particular representative, because of differences of politics and values, the person elected is put in a position of needing to represent EVERYONE in their district. So if someone wins an election with 51% of the vote - they are still supposed to represent the entire district. That's the job.</p> <p>There is a second responsibility that comes with being a member of the House of Representatives or Senate - and I think many people forget about this second requirement. That is, elected officials are also tasked with the responsibility of figuring out how to work well with others to pass legislation that promotes the best interests of all people in this country - they have a collective responsibility to figure out how to work WITH EACH OTHER!</p> <p>Can you imagine a CEO, division president or plant manager who decides to only serve the majority of people who agree with him or her - be that 51% or 76% or 82.5% or whatever number you come up with. How long would that person last? And how successful would that company be? It would fall apart very quickly with that kind of behavior. Oh, that's right, that's exactly what's happening - our government is shut down right now because certain people in the House of Representatives have decided that their narrow views are the only thing that matter. They have decided that they can ignore the laws of the land -&nbsp; the Affordable Care Act has been passed and is supported by the Supreme Court - and say that they know better.</p> <p>I'll answer my own question now. No - what we are seeing in the behavior of some people in the House of Representatives is not leadership. It is narcissism gone wild. I hope that everyone listens to the articulate young woman featured in the <a class="text_01" title="Impact of the shutdown" href="http://www.pbs.org/newshour/bb/nation/july-dec13/california_10-09.html" target="_blank">PBS Newshour clip</a> as she talks about the impact of this shutdown on her. She's working hard to do the right thing in her life - as an individual, an employee and a community member. She speaks clearly and directly.&nbsp; Perhaps members of the House should learn from her.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/34_Is-this-leadership-.html Value, Fairness and CEO Pay <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Monday, July 15, 2013<br /> <p>What do they do with all that money? This is the question I was asked the other night by a colleague. It&rsquo;s a question I am often asked just after the latest CEO pay reports have hit the newsstands &ndash; and especially by people who work in <a class="text_01" title="CEO salary justification" href="%20(http://baselinescenario.com/2013/07/05/ceo-salary-justification-season-is-open/)" target="_blank">management consulting</a> outside the United States. It&rsquo;s a question I often ask myself as well &ndash; what could anyone do with all that money?</p> <h4>What is money?</h4> <p>Many years ago I became curious about the concept of money and the institutions that surround it so began a wide-ranging research project to seek answers to some of my questions. My findings came down to a few key points.</p> <p>First, conceptually money is a representation of value. The paper product or coin itself has little to no value outside of what it is supposed to represent.</p> <p>Second, money is supposed to actually represent something of value &ndash; that is, an object classified as money is supposed to directly translate into some tangible action, creation or accomplishment that the holder of the money has produced.</p> <p>Third, throughout most of time in most societies, money was meant to be circulated. Given that money represented the value of actions and contributions, the only way for a society to create more value was if money and what it represented continuously moved throughout the society. This becomes clear only when we remind ourselves of the reality that money itself is not what has value &ndash; it is a representation of the value that actually exists in something else, something that has actual value to a person, family, community or society.</p> <p>There&rsquo;s more that I learned from my research project, yet these three basic points gave me a place to start. And then of course I started thinking about what this might mean for the place of money in our society.</p> <h4>Money and Value</h4> <p>If money is a representation of value then there are perhaps other things that could also represent value in similar ways. This is quite evident in recent efforts to start alternative payment systems &ndash; such as community dollars, <a class="text_01" title="Scrip programs" href="http://www.youtube.com/watch?v=McoszlaX4kY" target="_blank">scrip programs</a> and barter systems.</p> <p>The representation of value is clear in these systems, it is tangible, not just conceptual. &nbsp;Community dollars and scrip do represent the value symbolically &ndash; as a piece of paper linked to an action - while direct barter links one action of value directly to the one it is being exchanged for. Yet for both scrip and community dollars the action linked to the piece of paper is often quite visible, a local or recent action that has enabled someone to receive the scrip or community dollar.</p> <p>When value is embedded in the work, service or product you are willing to exchange for the work, service or product of someone else, then the money that you received for your actions should be able to represent that value as well.&nbsp; So your money should represent to you the value of your work/service/product, your contributions, and your actions. And when you spend your money you are letting go of some of the value you created and honoring the value that someone else created. You exchange your value for someone else's.</p> <p>If you have saved money for a while by basically saving the accumulated value of your actions, then you can exchange that value for a large amount of work, service or product &ndash; for example a bicycle, a car, a home &ndash; that you believe represents a fair exchange. If we think about it, this is what we all hope for in exchanges &ndash; that the value that I give to someone else for their work, service or product is of comparable value to the efforts I put in to producing the money I have available to exchange.</p> <h4>Fairness and Exchange</h4> <p>Fairness is a concept that is very important to human beings and to functioning societies. <a class="text_01" title="Babies and fairness" href="http://www.livescience.com/16460-babies-grasp-fairness-sharing.html" target="_blank">Babies</a> and young children instinctively respond to situations in which fairness and unfairness are present, implying that at a very young age, humans exhibit social behaviors linked to the fair distribution of resources.</p> <p>As we age our understanding and practice of fairness shifts from one based often on egalitarianism &ndash; everyone should get the same amount of milk and number of crackers after nap time &ndash; to one based on <a class="text_01" title="Fairness and merit" href="http://www.ncbi.nlm.nih.gov/pubmed/20508132" target="_blank">meritocracy</a>. In a meritocratic system we believe that it is fair that people who have expended significant effort to create value will receive comparable value in return. Yet in a meritocratic system the value of one person&rsquo;s work is always determined relative to the value of other people&rsquo;s work. Theoretically at least, the value of every individual&rsquo;s work is thus relative to the value of every individual&rsquo;s work &ndash; it&rsquo;s a system that has found a way to stay in balance.</p> <p>Taking this back to money, this means that people who work harder, contributing more to the system of production, will receive more money in return for their efforts. But it all needs to fit within the same system in order for us as human beings to see merit in the process &ndash; we look for fairness.</p> <h4>Pay Equity and Fairness</h4> <p>Which gets us right back to questions about CEO and senior executive pay. First, is it fair, and second, what do they do with all that money? The fairness question is I believe a fundamental question we ask as human beings. Because we are social animals and recognize (when we stop to consider) that our survival depends on <a class="text_01" title="Survival of the Kindest" href="http://www.templeton.org/templeton_report/20110504/index.html" target="_blank">collaboration and cooperation</a>, the notion of fairness comes up in our assessment of the systems that dominate our social lives.</p> <p>Pay equity is a fairness issue specifically because it goes to the heart of how we organize and support ourselves as human beings. Equity in a system means that there is a direct link between the value associated with one person&rsquo;s actions and the value associated with another person&rsquo;s actions. Often discussions about pay equity get sidetracked by a focus on numbers when fundamentally the discussion is about fairness. When CEO pay becomes a target of complaints and criticism it is, at its core, a complaint about a system that people perceive to be unfair.</p> <p>The question of what people do with all that money is tied back to the fairness question yet rests more deeply in an exploration of the value of people&rsquo;s contributions. Sometimes people joke about what they would do if they had all that money, and some people support excessive CEO and senior executive pay packages because they fantasize that maybe someday they&rsquo;ll be a CEO and get all that money. Yet is it really money they are thinking about &ndash; or is it value?</p> <h4>Pay and Value</h4> <p>The question of value and CEO pay takes my mind on two paths that link fairness and value with money &ndash; one has to do with a CEO&rsquo;s ability to exchange her pay for other things of value and the other has to do with how a CEO himself thinks about his own value relative to all that money received.</p> <p>If a CEO is paid a lot of money for her work and she then spends that money on other things &ndash; a new car, a house, a vacation &ndash; she is exchanging the value of her work for the value of someone else&rsquo;s work that produced the car, house or education. Yet what if she has so much money that she buys 3 cars and 4 houses, and her vacation is on a yacht that she rented and then decided to buy because she had enough extra money that she could do that. All of a sudden the question of the exchange value of work and money gets confounded.</p> <p>There are two dilemmas that arise for most people here. First, is the work of the CEO really that valuable that she should be able to buy 3 cars, 4 houses and a yacht (or whatever excess level of consumption beyond need you want to include here), when the exchange value of another person&rsquo;s work can barely enable them to rent an apartment and take the bus? In a meritocratic system the value of the CEOs work will be recognized by higher levels of compensation than the work of others &ndash; yet there will be some level of relative value that exists in order for the system to be seen as meritocratic.&nbsp;</p> <p>It is this issue of relativity that many believe has been lost with the skyrocketing inequality that exists between the pay of CEO&rsquo;s and senior executives and the pay of all other workers. These other workers contribute to the creation of the goods and services that are used to justify the value (pay package) provided to the CEO &ndash; yet their contributions are valued at a much lower rate than the value accorded to the CEO&rsquo;s contributions. Thus the fairness question comes into play.</p> <p>The second path I consider has to do with what someone receiving all that money must think about himself relative to all the other working people in the world who receive so much less value for their efforts. Do they see themselves as that uniquely valuable to the world or do they not think about it at all?&nbsp; And if they see themselves as that uniquely valuable to the world do they see their value as something that comes from themselves alone, thus justifying an amount of compensation that many see as beyond excessive?</p> <p>I know that there are many CEOs and senior leaders who redistribute or share significant amounts of the value they receive in compensation through philanthropic and humanitarian activities. Many do so quietly, while some people&rsquo;s efforts are well known, and these efforts bring much good to the world. Yet most <a class="text_01" title="Who gives the most?" href="http://www.theatlantic.com/magazine/archive/2013/04/why-the-rich-dont-give/309254/" target="_blank">studies of philanthropic activity</a> indicate that it is actually the people with the fewest resources who give proportionally more of what they have to help others. So philanthropic generosity is not unique to those with lots of money and does not assuage the concerns of people looking at pay inequality. While there are many individuals with lots of money who share generously, there are many, many more who do not <a class="text_01" title="Giving to others" href="http://givingwhatwecan.org/" target="_blank">share as much as they could</a>.</p> <h4>Realtivity and Fairness</h4> <p>Regardless how much people share though we still get back to the basic questions that arise around CEO pay, and these questions have to do with fairness and value. Is it fair for one person to receive so much more money for the value of his or her work than everyone else does.</p> <p>And if one person does receive more value for their work, what does it say about the relative value of other people&rsquo;s work? If a CEO&rsquo;s contributions are, year over year, valued at 200 to 400 times more than that of the average person in his organization is the CEO really that magnificent or are the other people really just not that important at all? What message is the compensation committee of the Board of Directors sending to all the people who work so hard to produce value for the company?</p> <p>These are simple, fundamental questions that go to the heart of who we are and how we live as human beings. Extreme inequality is devastating to societies. What are you doing to change the inequalities that might be present in your organization?</p> <p>&nbsp;</p> <p>&nbsp;</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/33_Value-Fairness-and-CEO-Pay.html Corporate Citizens Stand Up – Consumers Respond <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Wednesday, July 3, 2013<br /> <p>At its most recent annual meeting, Starbucks CEO Howard Schultz <a class="text_01" title="Starbucks Annual Meeting" href="http://www.businessinsider.com/starbucks-ceo-howard-schultz-slams-anti-gay-marriage-shareholder-2013-3" target="_blank">responded</a> to a shareholder&rsquo;s challenge to the company&rsquo;s declaration of support for gay marriage legislation in its home state of Washington. His response was measured in tone, yet striking and forceful in its content. His comments affirmed Starbucks commitment to inclusion and equitable treatment (independent of the Supreme Court decisions which came later) for all people associated with the company, regardless personal characteristics such as sexual orientation.</p> <p>Schultz&rsquo; declaration with regard to Starbucks policy, and the clarity with which the company spoke out in support of marriage equality, was not news to those inside the company, nor really was it news to people who follow employment practices across companies. Yet it became a target for a shareholder activist who thought, perhaps, that he might be able to create some negative publicity or an awkward moment for the company. Yet it didn&rsquo;t work.</p> <p>When faced with a choice to do something that is far-reaching and is the right thing to do, versus doing something that is easier, and is an acceptable thing to do, what compels you to do the right thing?&nbsp; This is an important question for all of us to ask ourselves as we seek to consider the impact of our actions on ourselves, family, friends, and the planet.</p> <p>For business leaders these are important questions to ask &ndash; and answer &ndash; if they want their organizations to contribute to the betterment of the world, and actually if they want to have a world in which all of us can continue to exist and live together in respectful communities.</p> <p>We do many things as human beings in order to stay alive. In general we &lsquo;say&rsquo; that we want to make the world a better place for future generations and we anticipate being on the planet for many years into the future. Yet we regularly engage in activities that have horrific negative consequences for basic survival.&nbsp; Not to say anything about the other actions that we engage in that bring some short-term acceptable result yet add to a cumulative negative impact to long-term survival and betterment.</p> <p>The noise people are now making about these negative impacts, as well as the noise coming from the planet, has reached such a volume that many people who didn&rsquo;t previously want to pay attention, or simply weren&rsquo;t able to, must pay attention now &ndash; we can&rsquo;t avoid it.</p> <h3>Sustainability and Action</h3> <p>We learn about the consequences of our actions so quickly now because information is immediately accessible via the internet. Commentary about the consequences of our actions is also instantaneous.</p> <p>The recent building collapse in Bangladesh has caused individuals to look more closely at their clothing labels and caused <a class="text_01" title="Eileen Fisher responds" href="http://pubrelone.blogspot.fr/2013/05/eileen-fisher-social-responsibility.html" target="_blank">business leaders</a> to look at their contracts with production facilities. Some businesses are cancelling contracts and moving to different facilities while others are choosing to stay in Bangladesh and seek to make long term improvements in the facilities and working conditions there.</p> <p>The discovery of GMO <a class="text_01" title="Where did the GMO wheat come from?" href="http://www.businessweek.com/articles/2013-06-20/the-search-for-monsantos-rogue-gmo-wheat" target="_blank">wheat</a> in a field in Oregon brought an immediate cancellation of a wheat contract between the US and Japan, heightened testing of wheat exported to Europe and South Korea, and has resulted in a lawsuit by US farmers against Monsanto. Monsanto <a class="text_01" title="Monsanto responds" href="http://online.wsj.com/article/SB10001424127887323393804578559751960348868.html" target="_blank">says</a> that the wheat was placed in the field by saboteurs. It is not yet clear what options will be available for positive movement forward here.</p> <p>The debate about energy independence and the consequences of oil and gas production is, for now, significantly focused on the costs and benefits of <a class="text_01" title="Desmog blog" href="http://desmogblog.com/2013/07/01/obama-s-climate-pledge-keystone-xl-fracking-double-standard" target="_blank">fracking</a> as a production method and the use of tar sands oil as an input in the production process. Many people are actively raising questions and alarms about both costs and benefits and many business leaders are trying to figure out what &lsquo;stand&rsquo; they will ultimately take on this issue.</p> <p>Each of these topics highlights a current example of ongoing issues in which there are both far-reaching &lsquo;right&rsquo; actions to take as well as acceptable actions that could be taken. Right actions are difficult to take, as the debates surrounding them are contentious with various groups proposing possible choices. Acceptable actions one could take are easier, yet they do not solve the problem that generated the need for action nor do they delineate a clear path to change and improvement.</p> <h3>Choices to Make</h3> <p>So what do you do? Something that is bold, and that you believe will improve the world and our prospects for long term survival, or something that you see as acceptable, that fits within a general operating plan and allows your business to move forward in a way that won&rsquo;t draw attention &ndash; either from the press, shareholders or critics.</p> <p>Some people choose to do things that are acceptable, with all good intent. They are not the ones to break the mold and do something bold and challenging to convention, so they follow acceptable practice. There is social benefit in this option as continuous change and breaking of the mold can be destabilizing to a society. Yet there is also a cost associated with doing what is perceived as acceptable. The social changes that are essential to an evolving society bent on improving itself and enhancing the survival and growth prospects of its members will suffer if &lsquo;doing the acceptable&rsquo; is the goal of all members.</p> <p>Fortunately for all of us, there are many leaders who choose to do what they believe is right and bold, regardless what other people do. They will step into a world of uncertainty and act from a personal base of what they hold to be the right thing to do in a particular situation, rather than acting from a broader base of what the general public, business critics, financial analysts or shareholders might believe is an acceptable thing to do.</p> <p>Consumers, employees, and community members who are aware of these actions can make choices to reward, punish or ignore these leaders and their organizations.&nbsp; Leaders can persist with their actions, with what they believe to be right, and work hard to get people to come with them. If they are successful leaders then people will follow. Yet if they are not successful leaders, people will not follow, no matter how &lsquo;right&rsquo; the action taken.&nbsp; It is this combination of successful, respectful leadership and &lsquo;right action&rsquo; that I personally look for in companies I seek to support. I encourage you to do the same. Regardless your stance on the issues before us we all need to look carefully and critically at the actions of organizations we support &ndash; it is a very important step for our future.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/32_Corporate-Citizens-Stand-Up-Consumers-Respond.html Humility, Honesty, Leadership <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Wednesday, May 29, 2013<br /> <p>Great leaders are often recognized by the stories told of their successes. In the past, these stories were crafted in private. For some leaders, privately crafted stories were true and accurately represented the leader&rsquo;s role in whatever was being covered. Yet for others, a privately crafted story was fiction.&nbsp; The actions of many unnamed contributors could be swirled into the leadership story, with one person &ndash; the leader &ndash; laying false claim to the entirety of the success.</p> <p>Minimal public access to reliable data sources, and an inability for contributors to tell their own stories meant that &lsquo;crafted&rsquo; stories were often accepted as reality. Contributors - the people who worked long hours, made suggestions, provided extra effort and sometimes created the breakthrough success by themselves &ndash; were silent because they had no mechanism for telling their own stories or adding to the one being told by the leader. &nbsp;If their efforts weren&rsquo;t included in the privately crafted story presented about or by the leader then their place in the effort was often lost.</p> <p>This is no longer the case as the internet has changed everything.</p> <p>Into the future, stories about truly great leaders will be elevated, and the shaky foundation of fictitious narratives will be uncovered. Great leaders will have their stories supplemented, verified and corroborated by the words of others. Fictitious stories will be challenged, opened up and retold by those who will now be able to lay claim to their own work. By 2025 the continued shift in individual access to information sources and distribution channels, will alter the landscape of leadership success stories and alter leadership practice itself.</p> <h4>Attributes of the Great Leader of the Future</h4> <p>Great leaders will respond to this shift with the appropriate humility and consistent honesty they have always relied on as great leaders.</p> <p>Appropriate humility means that leaders are able to see themselves as no more and no less important to the success of the organization than they really are. With an appropriate view of their own role, they are able to clearly see, appreciate and support the contributions of others.</p> <p>Consistent honesty will be reflected in leaders&rsquo; ongoing efforts to provide straight answers to questions, to follow through on their promises and to insure that policies and practices within an organization are implemented according to guidelines and values.&nbsp; Honesty will support the acknowledgement of faults and mistakes as well as successes and progress.</p> <p>Great leaders will actually welcome these changes as the stories told about them will still be recognized as true AND they themselves will be better able to ensure that true stories are told about others. This will help assure that leadership is seen in its proper context within the overall narrative of what makes for a successful organization.</p> <p>Appropriate and consistent are not terms that evoke glamour, perceptions of high-risk strategy, or cutting edge products yet they are needed in order to pursue all of those things &ndash; or any number of characteristics that one might assign to a great leader. A leader&rsquo;s own abilities will come into play when people start telling stories about the gutsy move that saved the day, the visionary choices made, and intense hard work that pulled off a new market coup. &nbsp;Yet successful leaders will be those who move beyond their own talents to encourage others participation, recognize multiple contributions and activate collaborative creation.</p> <h4>Leading in the Age of Information</h4> <p>The job of being a successful leader in the future will be more personally challenging yet also provide opportunities for great professional reward. The open-information society we are moving towards brings with it fewer places to hide mistakes and missteps and greater exposure of actions. For great leaders this is a positive occurrence, as it will allow for the fast and accurate transmission of good works and an ability to constantly learn from failures or missteps.</p> <p>Yet this will also pose challenges as organizations learn how to communicate with more clarity and less spin. In the end, open access to information coupled with honesty should enable a broader understanding within and outside an organization of the entirety of what it takes to be a successful leader.</p> <p>For those not initially prone to sharing information broadly, the open-information society may prove challenging though it should help to weed out those people seeking leadership roles for their own glory rather than because they are truly capable of leading people forward.</p> <h4>Leaders Who Won&rsquo;t Succeed</h4> <p>Who are the leaders who won&rsquo;t be as successful? People with egos disproportionate to their skills, people who take others ideas and claim them to be their own, people who obfuscate and people who equate leadership with bullying and manipulation. While these leaders are also often less successful in today&rsquo;s world, it takes longer to discern their faults now than it will in just 10-15 years of improved information access and distribution.</p> <p>With fewer places to hide, these &lsquo;non&rsquo; leaders will struggle. Hopefully many of them will change and, with helpful personal and professional support, be able to shift their style to embrace greater humility and honesty. As these non-leaders fade from the organizational landscape their behaviors should also fail to be replicated in the next generation of leaders.</p> <p>The upside of all of these changes is that great leaders should be able to focus more of their energy on actually leading &ndash; assessing uncertainty, plotting a strategic course towards an opportunity, and leading the way &ndash; getting people to come with them who are engaged, well informed and prepared with the needed tools and talents.&nbsp; People will choose to engage with and follow leaders who are able to communicate their vision for the opportunities ahead and clearly articulate why each person and their work is important to the success to be achieved.</p> <p>Leaders who successfully move through uncertainty to take advantage of opportunities will do so on their own solid foundation of appropriate humility and consistent honesty. If they forget the foundation they will get called out quickly because many people will have access to information and will be able to distribute that information with lightning speed.</p> <h4>Time Spent Leading</h4> <p>Great leaders of the future will spend their time leading. Their leadership talents will determine their success as leaders. Non-leaders will be challenged for trying to live in a fabricated story. While this may be painful in the moment it can also be instructive. Non-leaders who have potential to be great leaders can seek development opportunities for growing and learning. Non-leaders without leadership potential can become excellent team members and individual contributors, and have their talents and contributions recognized as part of the success of everyone&rsquo;s efforts.</p> <p>Truly great leadership is akin to an artistic endeavor in which one aspires to a level of achievement or success that is unreachable - because the aspiration always exists into the future. As with much compelling art, the process of creation &ndash; in this case the activities and achievements of the organization &ndash; reflects clearly and strongly on the final results.</p> <p>Over time the medium may change, with different tools, techniques and inputs leading to different outputs. The great leader, like the great artist, will continue to create with what is at hand, seeking out new opportunities and talents to develop and utilize, inviting people to be part of the creation. Appropriate humility and consistent honesty will attract people to the leader. The next creation will evolve from their mix of talents and abilities, nurtured by great leadership. This is where the new stories will come from.</p> <p>&nbsp;</p> <p>&nbsp;</p> <p>&nbsp;</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/31_Humility-Honesty-Leadership.html Sometimes we imagine... <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Thursday, May 2, 2013<br /> <p>Sometimes we imagine that taking a stand is a very difficult thing to do. That it will be hard to make the right choice, to move forward in life, with family and friends and at work by doing the right thing, making moral choices, considering the impact of our decision on others lives before we make our choice. Yet really, it&rsquo;s not that hard at all. It just takes a little practice.</p> <p>I&rsquo;ve been thinking about a number of events that have happened over this past month &ndash; or that I&rsquo;ve become aware of &ndash; and the varying ways in which the choice someone made has affected other people&rsquo;s lives.</p> <p>One story I read about yesterday (and that has been picked up by media all across the country) concerns a small town in Georgia &ndash; south of Atlanta - in which, for the first time, high school students will be able to go to the same <a class="text_01" title="Integrated Prom" href="http://www.statesmanjournal.com/apps/pbcs.dll/article?AID=2013130430029&amp;gcheck=1" target="_blank">prom</a> regardless the color of their skin. For years, this town has held two different proms, one for people who consider themselves to be white, and one for people who consider themselves to be black. Abbeville Georgia is receiving a lot of attention this week because of the choices made by a few students to create a prom for everyone.</p> <p>Some parts of the stories are sad in some ways yet quite compelling in others. The segregated proms have been around for years, yet for many students with friends across color lines, segregated proms made no sense. So they made a choice.</p> <p>A note on the Facebook page for the group says: "We live in rural south Georgia, where not too many things change. Well, as a group of adamant high school seniors, we want to make a difference in our community. For the first time in the history of our county, we plan to have an integrated prom."</p> <p>These young people have made a choice to go forward in a new and different way because they imagined a world in which their lives could be changed in new and positive ways. They&rsquo;ve had their prom, and from all the news accounts it appears to have been a great success.</p> <p>In another country, on another continent, other young people were also looking for change, trying with their choice of work in a garment factory, to improve their lives and the lives of family members. Very sadly for many of them their lives have been irreparably harmed, or ended, because of the choices made by business owners who bought the clothes they produced.</p> <p>The choices of the young women working in the <a class="text_01" title="Retailers Split" href="http://www.nytimes.com/2013/05/01/world/asia/retailers-split-on-bangladesh-factory-collapse.html?ref=asia" target="_blank">garment factory</a> can be seen as positive ones. They wanted to make a difference in their lives, help themselves, their families, their children. Yet the choice they were offered came with many hidden costs. These costs are often faced by people who are poor, in low wage and low status positions, with little recourse if something goes wrong.</p> <p>The <a class="text_01" title="Factory Owner Arrested" href="http://www.nytimes.com/2013/05/01/world/asia/bangladesh-garment-industry-reliant-on-flimsy-oversight.html?ref=asia" target="_blank">factory owner</a> has now been arrested and is being charged with various criminal acts for not insuring that his factory was safe. Yet what about the companies who contracted with this factory owner to have their branded products made by the young women working there? What is their obligation to make the right choice?</p> <p>Many companies now require that factory owners sign contracts specifying that the factory is safe, that they are not employing children, that any harassment will be prosecuted, etc. And many companies send inspectors to plants to verify that what has been attested to in the contract is actually happening. Unfortunately this is not what happened in Bangladesh.</p> <p>An <a class="text_01" title="Textile Factory Disasters" href="http://www.nytimes.com/2013/04/30/opinion/bangladeshs-are-only-the-latest-in-textile-factory-disasters.html" target="_blank">essay</a> in the NY Times chronicles the factory disasters that happened years ago in the United States, leading to death and disfigurement for workers caught up in the destruction. Those disasters lead to significant changes in labor laws in the US, yet it took a long time and was met with resistance by some business leaders.</p> <p>What can we do now? How do we help to insure that women in Bangladesh and other places around the world who are looking for work have a better chance of finding safe employment? Business leaders can choose to follow the example of the young people in Abbeville Georgia, and take a stand to do what&rsquo;s right and take action. Taking a stand is more than just words, it does requires action, it requires visibility and it requires a commitment to follow through.</p> <p>There are many companies and their leaders who are making the right choices when it comes to insuring safety in their supply chains. Too often this comes after a disaster, yet in a number of cases it has been different. At <a class="text_01" title="Who Makes Our Clothing" href="http://www.eileenfisher.com/EileenFisherCompany/CompanyGeneralContentPages/SocialConciousness/Human_Rights.jsp" target="_blank">EILEEN FISHER</a>, leaders actively seek out production facilities in which employees are treated fairly and the buildings are safe.&nbsp; <a class="text_01" title="Milliken" href="http://www.milliken.com/en-us/Pages/default.aspx" target="_blank">Milliken</a>, named one of the World&rsquo;s Most Ethical Companies, has taken numerous steps to change products and processes so that they can &lsquo;do good&rsquo; in the world. <a class="text_01" title="Our Approach" href="http://shop.nordstrom.com/c/nordstrom-cares-approach" target="_blank">Nordstrom</a>, a well-known and well respected retailer, has been strengthening its social responsibility agenda and on-the-ground practices for years.</p> <p>It&rsquo;s not hard to take a stand. There are lots of examples available. You don&rsquo;t have to imagine anymore &ndash; you can actually do it.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/30_Sometimes-we-imagine-.html Raising the Minimum Wage <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Tuesday, March 5, 2013<br /> <p>What does it mean to set a wage <a class="text_01" title="Minimum Wages Across the US" href="http://en.wikipedia.org/wiki/Minimum_wage_in_the_United_States" target="_blank"><strong>below which</strong></a> a person&rsquo;s hourly pay can not fall? The idea of a minimum wage says that as a society we are choosing to indicate the minimum amount of money that needs to be provided to someone for his or her time and contribution at work. This hourly wage represents the value we accord to a certain amount of effort. It follows from the idea that a person&rsquo;s contributions to the work of a group, organization, or community should be valued highly enough that that person can live decently. No one will get rich off of a minimum wage job, yet in the abstract, the idea is also that no one should live in poverty if they are working at the amount of time and effort deemed reasonable in our society.</p> <p>Unfortunately, right now many people earning the minimum wage are living in poverty. The minimum wage is currently too low to fulfill the abstract argument that full-time work should enable you to live above the poverty line.</p> <p>There are a number of factors that can contribute to someone falling into poverty &ndash; such as poor public schools, lack of health care or health insurance, and natural disasters that deplete savings. Yet not having a chance right from the start to be able to weather the ups and downs of life because you are not paid a reasonable minimum wage is a major factor in pushing people into poverty or preventing them from getting out of poverty. The problem is real.</p> <p>In a recent spate of news attention to the minimum wage, <a class="text_01" title="Raise that Wage" href="http://www.nytimes.com/2013/02/18/opinion/krugman-raise-that-wage.html" target="_blank">Paul Krugman</a> wrote that &ldquo;&hellip;the current level of the minimum wage is very low by any reasonable standard. For about four decades, increases in the minimum wage have consistently fallen behind inflation, so that in real terms the minimum wage is substantially lower than it was in the 1960s. Meanwhile, worker productivity has doubled.&rdquo;</p> <p>Given that CEO and senior executive salaries have more than doubled since the 1960s &ndash; just using worker productivity as a justification for wage increases &ndash; doesn&rsquo;t it make sense to raise the minimum wage? A recent report by the <a class="text_01" title="Declining Value of Federal Minimum Wage" href="http://www.epi.org/publication/declining-federal-minimum-wage-inequality/" target="_blank">Economic Policy Institute</a> affirms that while the trends in high CEO salaries relative to worker salaries has moderated, &ldquo;the CEO-to-worker compensation ratio in 2011 of more than 200-to-1 is far above the ratios prevailing in the 1960s, 1970s, 1980s, and mid-1990s.&rdquo; So perhaps there is something about raising the minimum wage that everyone should consider seriously and thoughtfully. Especially people in Washington who have the ability to change the law.</p> <p>In many great workplaces hourly and low-wage workers are currently paid more than the minimum wage. They are also provided with benefits and working conditions that help to create and reinforce a culture of respect and support for all employees. This means that in these great organizations, the experience of being a low-wage or hourly worker is more positive than it is for their peers in other organizations. Employees in these companies not only earn a bit more, they also are seen as full members of the organization so benefit from the organizational support that is provided to people in times of need. An hourly wage is an important part of the process of keeping people out of poverty, yet full membership in society is also important. Seeing people as valuable regardless the money they may earn or control is important.</p> <p>Why do leaders in great workplaces choose to pay people more than the minimum wage? Leaders in great workplaces not only say &ldquo;people are our most important asset&rdquo;, they believe it and act on their belief. If people really are the most important asset in an organization then their work will be fairly recognized and rewarded.</p> <p>At <a class="text_01" title="Ohio Health" href="https://www.ohiohealth.com/" target="_blank">Ohio Health</a>, a regional health care provider based in Columbus Ohio, employees are provided with a &lsquo;reasonable minimum wage&rsquo; that is currently higher than both the state and federal minimum. What benefit does Ohio Health receive for providing a higher wage than they are legally required to? Ohio Health is one of the 100 Best Companies to Work For and they have been for many years. They have lower turnover, higher patient satisfaction, and more engaged employees in their organization than can be found among their peers.</p> <p>Is it all due to the minimum wage? Of course not. Yet it is due to the philosophy held by leaders that guides all the policies and practices, including the policy of paying a reasonable minimum wage. As they indicate, &ldquo;OhioHealth maintains a "reasonable" minimum wage to assist associates in lower-paying positions to improve their overall quality of life.&rdquo;</p> <p>Another health care organization, <a class="text_01" title="Baptist Health South Florida" href="http://baptisthealth.net/en/Pages/home.aspx" target="_blank">Baptist Health South Florida</a>, also provides employees with a minimum wage above the federal requirement. &ldquo;Baptist Health created its own minimum wage that is $1.50 over the federal minimum wage and $1.08 over Florida's minimum wage. The minimum wage also provides an important community benefit: By raising the standard of living for our employees, we provide an important financial and economic boost to the neighborhoods in which they live.&rdquo; Baptist Health South Florida is also a 100 Best Company and has been for many years.</p> <p>These are not the only healthcare companies that recognize the importance of paying people fairly yet they are two excellent examples.</p> <p>Another company with a unique and equitable approach to pay is <a class="text_01" title="Radio Flyer" href="http://www.radioflyer.com/" target="_blank"><span class="text_01">Radio Flye</span>r</a>, one of the Best Small Companies to Work For. Leaders at Radio Flyer pride themselves on the fact that they have never lost a job candidate because of pay or benefit concerns. This is notable for a small company as many people considering proposals to raise the Federal minimum wage cite the concerns of small employers as reasons to keep the minimum wage at its current low level. Yet at Radio Flyer they already aim higher &ndash; targeting the 75th percentile for compensation and merit increases. They provide people with a 401k &ndash; with a 50% company match up to 6% of salary &ndash; and a profit sharing retirement plan.</p> <p>A medium sized organization, <a class="text_01" title="Intuitive Research and Technology" href="http://irtc-hq.com/site/index.php" target="_blank">Intuitive Research and Technology</a> uses their compensation philosophy to help new employees get off on the right foot on day one of their employment. The goal is to bring people in at a good rate for what they are being hired to do, never trying to see how cheaply someone could be hired. The philosophy also guides the company&rsquo;s straight-forward approach to what is offered, &ldquo;We offer what we are going to offer right up front. This eliminates "haggling" back and forth over pay, which can sometimes leave a bad taste with new hires, a bit like leaving a used car lot wondering whether you did well or not.&rdquo;</p> <p>Equating haggling over pay with negotiations over trying to get a better deal certainly paints a clear picture of what some people experience when looking for a job. The unique approach at Intuitive Research and Technology shows that they recognize the cost of haggling or trying to be cheap and avoid it &ndash; not just by being straight with base salary information but also by providing notable incentives and benefits to all employees that reward their effort and creativity.</p> <p><a class="text_01" title="Wegmans" href="http://www.wegmans.com/webapp/wcs/stores/servlet/HomepageView?storeId=10052&amp;catalogId=10002&amp;langId=-1&amp;clear=true" target="_blank">Wegman&rsquo;s Food Markets</a> provides people with livable wages that are presented to employees as stemming from their philosophy of collective success and shared rewards. Leaders at Wegman&rsquo;s care deeply about the well-being and success of every person in the organization, and believe that they will achieve their goals only if they first meet the needs of their own people. When Robert Wegman became president of the company in 1950, he laid the foundation for sharing that is followed today. He raised salaries for all employees and implemented benefits programs, supplementing those later with a 401(k) and a scholarship program. Wegman&rsquo;s philosophy states, &ldquo;good people, working toward a common goal, can accomplish anything&rdquo;. Leaders at Wegmans are clear that their collective success needs to be shared in collective rewards, not individual rewards or bonus systems. As they state very clearly, &ldquo;<em>We do not reward one for what was achieved by many</em>.&rdquo; (emphasis mine)</p> <p>So, back to the minimum wage. I&rsquo;ve presented a few examples of companies in a variety of industries, of varying sizes and locations in the country, all trying to find ways to pay their employees fairly and equitably. Some companies specifically target the minimum wage and set their lowest levels of pay higher than what they are legally required to do. Other companies simply find that by following a philosophy of humane and caring leadership that their pay packages are naturally higher than the minimum set by law. All of these companies are recognized as great workplaces, have loyal employees, loyal customers or patients, and are positively regarded in their communities.</p> <p>Raising the Federal minimum wage is a step in the right direction that would affirm our country&rsquo;s philosophical commitment to fair pay and the value of every individual member of our society. It&rsquo;s past time to take this step, and thanks to the Best Companies there are lots of examples of companies who have already moved forward on this path and done very well.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/29_Raising-the-Minimum-Wage.html Higher Purpose <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Tuesday, January 22, 2013<br /> <p>I was quite inspired this morning watching the President&rsquo;s <a class="text_01" title="Inauguration" href="http://projects.nytimes.com/live-dashboard/obama-inauguration" target="_blank">inauguration</a> and listening to the many speeches and readings in honor of the great tradition of leadership transition that we celebrate on inauguration day. I was particularly taken by the many ways in which people called out for all of us to reach for a higher purpose in our work, our lives and our interactions with others.</p> <p>I was reminded that the path to higher purpose is one of aspiration, not necessarily achievement. People spoke of their own struggles, as well as reminding us of the struggles of all the men and women who created this democracy. Our country was founded on certain ideals yet at the moment of its founding it was not living up to all of them. For a few specific groups it was living up to very few of them. Yet still, everyone aspired to something better. And I am very grateful for their efforts.</p> <p>I saw today all the different kinds of people that make up the United States and was reminded of the unbelievable beautiful power of a diverse group of people coming together to create something larger than themselves. The <a class="text_01" title="Choir at inauguration" href="http://www.mediaite.com/tv/brooklyn-tabernacle-choir-performs-battle-hymn-of-the-republic-at-obamas-inauguration/" target="_blank">Brooklyn Tabernacle choir</a> was wonderful to hear and to see &ndash; so many people working together to create an amazing sound &ndash; honoring a President and an ideal &ndash; and all of them able to trace their family roots to some place around the globe, near or far. Diversity is one of the great powers of this country.</p> <p><a class="text_01" title="Invocation" href="http://abcnews.go.com/Politics/video/inauguration-day-2013-myrlie-evers-williams-delivers-inaugural-prayer-18273167" target="_blank">Myrlie Evers-Williams</a> provided a powerful invocation; wisely spoken words calling on all of us to step up, to remember who came before us and where we are going. She showed us one of the skills of great leaders - an ability to create an image that relies on the past yet does not dwell in it. By calling out people and ideas to whom many of us owe a great deal, she sought to identify the path forward, and named it as one on which all of us can travel. Providing a sense of direction that is inclusive and full of opportunities is necessary if people are going to follow a leader.</p> <p>The poetry of <a class="text_01" title="Blanco poetry" href="http://abcnews.go.com/Politics/today-richard-blanco-poem-read-barack-obama-inauguration/story?id=18274653" target="_blank">Richard Blanco</a> was moving as personal testimony to his life and the hard work of his parents, and also as a reminder of the beauty that can reside in words so artfully put together. Poetry helps us to imagine our higher purpose and what we will see along the way as we seek to achieve it. While not all leaders are capable of speaking poetically many are able to convey, through their own words and stories, the higher purpose of their organizations and how every member can be a part of achieving something greater.</p> <p><a class="text_01" title="Obama speech" href="http://www.cnn.com/2013/01/21/politics/obama-inauguration/index.html" target="_blank">President Obama&rsquo;s</a> own speech was in many ways a leadership parable. The words themselves did not create an allegory yet the entire message, with the details and embedded challenges, identified our need to move forward &ndash; as a country and a group of people with, at times, conflicting interests. Yet we need to move forward.</p> <p>Great leaders are the ones who are able to see through the uncertainty that surrounds them, identify the opportunities in the distance, and bring people together to go forward. Great leaders encourage us to work with each other, they inspire us and help to identify and clarify our aspirations. And we choose to follow them.</p> <p>In business as in politics seeking to be a leader who pursues a higher purpose is a weighty challenge. In business &ndash; the for-profit ones &ndash; the purpose has often been said to be to make the most money possible for owners/shareholders. In politics, the purpose has often been said to be getting elected and staying in office while providing special benefits to special interests. Yet if politicians and business leaders seek a higher purpose in their work then they must step beyond the small goals &ndash; making money as a capitalist, getting elected as a politician &ndash; and seek to do something more.</p> <p>A business leader seeking a higher purpose should seek to run a profitable organization, yet this is a small goal relative to what is possible. Business leaders need to be aware of and responsible for the consequences of their actions. The lives of people who choose to follow are invaluable to the success of the organization, and people&rsquo;s contributions create the success of the business. &nbsp;A great leader will understand the balance between his/her role as a leader of people, and the contributions of everyone else in the organization that actually creates the wealth that the organization sells as products or services. Great leaders respect contributors and share rewards fairly.</p> <p>A great politician seeking a higher purpose should seek to respond to people&rsquo;s requests in such a way that reelection is possible, yet there is more. Political leaders need to call out our challenges, and inspire large groups of people towards collective action to meet those challenges. Great politicians need to insure that smaller groups, or those who are quiet or afraid, have a voice as well &ndash; that their challenges do not get overlooked. Great politicians know how to move among people of great difference and find common ground &ndash; an immensely valuable leadership skill.</p> <p>Too often business leaders and politicians are called out for going after the lower purpose of their profession, not the higher purpose. Yet last week, the <a class="text_01" title="2013 100 Best Companies" href="http://www.greatplacetowork.com/best-companies/100-best-companies-to-work-for/trends-of-the-2013-100-best" target="_blank">2013 100 Best Companies</a> were announced and this week our President was inaugurated for a second term. These leaders have much in common &ndash; they seek a higher purpose in their lives, their work, and the contributions they make to the greater good of this country and world. Not one of them is perfect, for they are aspiring humans like the rest of us. We can learn from them, teach them by making sure they are aware of the consequences of their actions, and hold them accountable for always seeking to live up to the higher purpose they identify as their goal.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/28_Higher-Purpose.html Choices for the New Year <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Tuesday, January 1, 2013<br /> <p>I was recently asked to consider the question of what I would do differently if I could start over, at a younger age, yet with the knowledge I have now. Would I do anything differently?</p> <p>I couldn&rsquo;t answer the question initially as being the logical minded person that I am, I was unable to wrap my head around the reality of the idea of &lsquo;If I&rsquo;d only known then what I know now&hellip;&rsquo; with the implication that somehow my life and work would have turned out differently.</p> <p>There are of course many &lsquo;what ifs&rsquo; that I have lived through, as have all of us. Yet I don&rsquo;t ever imagine going back in time and reliving those events differently.</p> <p>What I do imagine is going forward, and living my life better. As I have tried to do this throughout my life, one step that has always helped me to stay reasonably on track is seeking out the advice of others. People wiser then myself have often shared with me some of their life lessons, either as their own stories, or as advice specifically for me based on their own experience and what they know of me.</p> <p>How does someone become wise?&nbsp; I think that happens when we live our lives, learn from events, and find a way to go forward that is more beneficial to others, and to ourselves, than what came previously. The wise people I sought out were often older than me, meaning they&rsquo;d had more time and more experiences to learn from. Yet not always. The point is that talking with other people, listening to their stories, taking lessons from their experiences, can be a rich and fulfilling way of helping yourself to go forward and live your own life better.</p> <p>So in the spirit of living my life better, and of helping others on their own journeys, I&rsquo;ve thought of a few things that I know or believe that I&rsquo;d like to share. Perhaps these &lsquo;lessons learned&rsquo; will help you to go forward more successfully and move through some of the stumbling blocks that I did with a bit more grace. &nbsp;</p> <p>First, go forward in life with confidence that what you have chosen to do is valuable to the world at large and important to you personally. In order to do this I believe that it is important to think about what you are doing and why. Regardless the specific task, is the work that you are contributing to &ndash; building a product, providing a service, raising a child, supporting an elder, producing works of art &ndash; adding value to the world and filling your life with value?</p> <p>On balance, does the time you spend in the world produce more that is positive than neutral, and hopefully very little that would be considered negative? If not then perhaps it is time to think about how to shift your activities to do more that is positive.</p> <p>Second, take the time needed to choose wisely &ndash; pursue a career or way of life at a reasonable pace that enables you to enjoy being alive. This can be difficult for people who accumulate bills to pay, student loans to pay off, or desires for things that require lots of money. Yet as I have become older this lesson has been reinforced to me time and again, and I cannot emphasize it enough.&nbsp;</p> <p>Slow down or put off the accumulation of debt so that you can have the freedom to move and pursue interesting options. Take longer to finish college than what is traditional, if that extra time means you can work and pay your way, or at least minimize the debt you accumulate. You will be gaining work experience, which can make you more attractive as a job applicant or give you ideas for starting your own business. Without a significant debt burden, you will also have greater freedom when the time comes to make choices.</p> <p>If you take the time early in your life and work to prepare yourself to make valuable contributions as you gain more experience then when special opportunities or great challenges arrive you will have more resources available, personal and financial, to help you move forward.</p> <p>Third, to the best of your ability treat people with respect and fairness, without manipulation or deception, so that you are always able to look people in the eye.&nbsp;</p> <p>Actions that convey respect and fairness can be quite challenging to put into practice as they often rely on sharing. While I believe that human beings are built to cooperate and share &ndash; that these qualities insure our survival &ndash; I also believe that a self-protection instinct can kick in at times that triggers a desire to acquire more than is needed to live a good life.</p> <p>I think that one of the great challenges of young adulthood is mastering the tension between the survival instinct to acquire things and the deeper knowledge that sharing with others is a better long-term life strategy.</p> <p>Fourth, in the spirit of hoping that the struggle between survival instinct and deeper knowledge does help you to come out on the side of cooperation and sharing, I urge you to share, in the workplace and in your personal life. Share the joys and burdens of work with your colleagues and co-workers, and when you have the opportunity to do so, share the rewards as well &ndash; fairly and equitably.</p> <p>From my many years of work with people in great workplaces in which relationships are built on trust, I&rsquo;ve seen again and again the power of shared burdens and shared rewards. Great teams are built on people&rsquo;s ability to commit to each other and commit to the vision and mission of the organization. When people share in creating their experience at work the vision and mission become a part of their own lives.</p> <p>Successful trustworthy leaders in great companies do an exceptional job of promoting sharing and cooperation, thus creating an experience at work that is greater than each individual&rsquo;s contribution. Successful leaders help people to see the benefits of their cooperation and contributions in part by sharing the rewards of the group&rsquo;s success equitably.</p> <p>Sharing in your personal life, with friends and family, will garner similar types of benefits yet the rewards will be different. In our personal lives the rewards we receive are mostly emotional and experiential. We learn in our personal lives of the power of human attachment and the importance of caring.</p> <p>Finally, I encourage everyone to pursue happiness &ndash; our time on earth is brief in the grand scheme of things and a bigger car, bigger house or corner office pale in comparison to being happy. &nbsp;</p> <p>And what is happiness? Well that&rsquo;s the big question. From my experience, and from watching the lives of others, I can say that happiness comes from being able to live a good life. Happiness does not come easily, and at times the more challenging the experience we&rsquo;ve gone through the happier we are at the end. Working hard, using our talents and skills, taking on a big challenge &ndash; all of this can lead to happiness.</p> <p>Laughter and smiles can indicate a happy present state of mind, yet deeper happiness comes from something more. Trusting people, working together to accomplish something, taking on a great challenge and finding a way through the chaos &ndash; all of these can bring deep happiness to our lives.</p> <p>A good life is a balanced life - one in which we are able to make valuable contributions to our own lives and the lives of others. Moving at your own pace is important, as is being honest with yourself that you are neither slacking, nor taking more than your fair share. Thinking through what respect and fairness mean will help you to understand what role you can play in this great human experiment, and wise choices will help you to decide how to share your gifts and talents with others.</p> <p>There is much that is amazing and positive in the world yet there are many, many struggles as well. Lots of people are caught in lives of pain and difficulty. If you do have the freedom to make choices that will make your life better as well as contribute positively to the lives of others then you have been given an incredible gift for this New Year and years to come. You have an opportunity to bring more good into the world.</p> <p>Choose wisely.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/27_Choices-for-the-New-Year.html Business Leaders Helping to Make Cities Great <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Monday, November 5, 2012<br /> <p>During my travels in October I participated in a number of conferences and provided a few presentations to private companies and for associations. While all of my work was interesting I had two experiences that affirmed the powerful positive role that business leaders can play in rebuilding and strengthening communities and civic life.</p> <p>At the <a class="text_01" title="CEO Summit" href="http://consciouscapitalism.org/summit/" target="_blank">Conscious Capitalism CEO Summit</a> held in Austin TX in early October I met the folks behind the <a class="text_01" title="Downtown Project" href="http://downtownproject.com/" target="_blank">Downtown Project</a>, a stunning effort to revitalize downtown Las Vegas NV. <a class="text_01" title="Tony Hsieh" href="http://about.zappos.com/meet-our-monkeys/tony-hsieh-ceo" target="_blank">Tony Hsieh</a>, CEO of Zappos (one of the 100 Best Companies) presented a detailed overview of all that has gone into the design and development of this project. Yet more importantly from my perspective he talked about why he has taken this project on.</p> <p>Hsieh, along with Jenn Lim and James Key Lim of <a class="text_01" title="Delivering Happiness" href="http://www.deliveringhappiness.com/" target="_blank"><span class="text_01">Delivering Happines</span><span class="text_01">s</span></a>, launched the Downtown Project with a commitment to creatively influence the trajectory of downtown Las Vegas &ndash; a city hit hard by the economic woes facing many parts of the U.S. A couple of well-written <a class="text_01" title="Downtown Project" href="http://www.nytimes.com/2012/10/21/magazine/what-happens-in-brooklyn-moves-to-vegas.html?pagewanted=all" target="_blank">articles</a> can tell you what they are doing.&nbsp; I learned about why they are doing this from Tony&rsquo;s presentation and my conversations with Tony, Jenn and James during the conference.</p> <p>These people are thinking big and small at the same time. The big thought is evident in the scope of the Downtown Project &ndash; a 350 million dollar investment in residential development, small businesses, education and tech startups. The goal is to change the landscape of downtown Las Vegas within 5 years, making it an attractive place for the arts, education, businesses, individuals and families.</p> <p>The small thought has to do with the reasoning behind what&rsquo;s big. Actually it's not really a small thought at all, just a bit more subtle than the big, visible changes happening in Las Vegas. Hsieh wants to create opportunities for <a class="text_01" title="Community Events" href="http://downtownproject.com/community-events/" target="_blank">connections</a> to occur throughout the downtown area. His belief is that the more people are able to interact with each other in positive and enjoyable settings, the more they will learn and share, creating knowledge and experiences that improve the quality of life for everyone. And when this happens, a city is remade.</p> <p>After my time in Austin, I went to Tijuana Mexico, at the invitation of a group called <a class="text_01" title="Tijuana Innovadora" href="http://www.tijuanainnovadora.com/" target="_blank">Tijuana Innovadora</a>. TI is a volunteer group of civic-minded people from Tijuana and San Diego seeking to inspire and motivate community members to value all that is positive in Tijuana, as well as create an energetic commitment on the part of business leaders to invest in the growth of Tijuana&rsquo;s business community.</p> <p>The cornerstone event of Tijuana Innovadora is a biennial week-long conference, including presentations and workshops by people from all over the world, as well as an exposition featuring businesses and organizations with facilities in the Tijuana region. High school and college students are able to volunteer at the conference and attend the events, families come to see what is happening in their city and businesses set up elaborate displays to showcase their activities in the region. It was a wonderful, inspiring event.</p> <p>Prior to my presentation at TI, I was able to visit the Plantronics facility in Tijuana. Plantronics is the <a class="text_01" title="Plantronics #1 Best Workplace in Mexico" href="http://www.greatplacetowork.com.mx/mejores-empresas/mas-de-500-empleados-y-multinacionales" target="_blank">#1 Best Workplace in Mexico</a> in it's size category, and after my visit I can see why. Their expansive facility includes design, manufacturing and distribution areas, with over 2300 people employed there. I learned of the many programs offered to employees and their families that benefit them directly yet also make Tijuana a better place for people to live and work. Education and cultural programs are offered and numerous community service projects help spread benefits throughout Tijuana.</p> <p>The organizers of Tijuana Innovadora want to insure that lots of people know about Plantronics success in their city, and Plantronics wants to provide support to its employees, their families, and the broader community to help make Tijuana a great place for people to live and work.</p> <p>Each of these programs is taking a slightly different approach, yet with the same goal. Las Vegas Nevada and Tijuana Mexico are both cities with tremendous natural assets, and people within their communities that want to see their home city become great again. And in both places, business leaders are actively involved in facilitating civic involvement for the benefit of everyone, providing powerful examples to follow.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/25_Business-Leaders-Helping-to-Make-Cities-Great.html Restoring Trust <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Monday, October 8, 2012<br /> <p>I recently participated in the <a class="text_01" title="Summit on Restoring Trust in Business" href="http://www.trustinorganizations.com/events?eventId=522215&amp;EventViewMode=EventDetails" target="_blank">Summit on Restoring Trust in Business</a> at Fordham University, sponsored by their Consortium for Trustworthy Organizations.&nbsp; Robert Hurley, a professor in the business school and author of <a class="text_01" title="The Decision to Trust" href="http://www.amazon.com/The-Decision-Trust-High-Trust-Organizations/dp/1118072642" target="_blank"><em>The Decision to Trust</em></a> took on the task of organizing the Summit meeting (and the Consortium itself) out of a sense of mission and frustration. Everyone there seemed to share these two sentiments.</p> <p>Participants and presenters ranged from leading academics studying the implications of trust in organizations to business leaders affected by stakeholders&rsquo; trust, or lack of it, in their businesses. MBA students at Fordham trying to determine the right path to follow and best employer to join up with were also present. Over lunch we heard from <a class="text_01" title="Edelman " href="http://www.edelman.com/" target="_blank">Richard Edelman</a> about the implications of declining stakeholder trust in so many of society&rsquo;s institutions around the world.</p> <p>Everyone agreed that yes, there is a trust problem facing businesses and society. How to approach the problem of diminished trust attracted less agreement.&nbsp; A few people were frustrated that their organizations were being singled out as untrustworthy, claiming that it is in people&rsquo;s nature to latch on to scandals and blow them out of proportion to the incident. Others argued strongly that stakeholders reactions to scandals &ndash; whether single incidents or long running practices &ndash; are legitimate regardless whether one agrees with their point of view or not.</p> <p>All agreed that it is an organization&rsquo;s responsibility to respond and that some companies and institutions are more adept at this than others.</p> <p>As I listened to people&rsquo;s stories and participated in the discussion, a few points clarified for me and I&rsquo;d like to share them here.</p> <p style="padding-left: 30px;">First, with respect to the idea that people latch on to scandals and that&rsquo;s why an abundance of attention gets placed on small negative incidents that are blown out of proportion relative to the good that a company does.&nbsp; I believe that what is actually happening is that people are latching on to the story that is being told. Negative incidents can make good stories as the people who tell them are often trying to explain to themselves and others how something seen as scary, confusing or even life-threatening could have happened. It is something we all want to steer clear of so we need to understand the story &ndash; how it happened &ndash; to try and avoid it next time.</p> <p style="padding-left: 30px;">The same is true for good stories though and I cite as an example the fact that Fortune magazines issues with the Best Companies to Work For and the Most Admired stories in them are consistently some of their best selling issues. People want to read a good story and the details in those two issues &ndash; about how leaders create great workplaces, what employees think of their bosses, and which companies garner worldwide admiration from stakeholders &ndash; grab people&rsquo;s attention.</p> <p style="padding-left: 30px;">So what should we do? Learn how to tell detailed, positive <a class="text_01" title="Cole Hardware story" href="http://www.trustworthyleader.org/eng/Blog/21_Small-Business-Success-Story.html" target="_blank">stories</a> in our workplaces about what is going well, describe the positive incidents and interactions, how they happen, why they happen and what the benefits are. Give as much attention to the details of a positive event as a negative one &ndash; actually give more attention to the positive events so that people know exactly what happened and why and they can learn from it.</p> <p style="padding-left: 30px;">Maybe you&rsquo;ll start to see more positive events as people will try to emulate the behavior in the positive story.&nbsp; With negative stories we learn about things to avoid, yet don&rsquo;t learn about how to make things better.</p> <p style="padding-left: 30px;">Everyone who introduced their company at the Summit began by talking about the amount of money their company makes &ndash; it&rsquo;s &lsquo;size&rsquo; - then about how many employees there are in how many different countries. They then moved on to talk about the various markets in which they do business and whether or not they were one of the dominant players. No one talked about the quality of the workplace or the level of trust that exists between employees and management. And we were at a gathering whose focus was on restoring trust in business!</p> <p style="padding-left: 30px;">Is the market capitalization of a company something that is going to inspire you to trust that company? It&rsquo;s market share, dominance in a niche, global reach? None of these pieces of data convey anything about the quality of interactions that occur in the organization - they are numbers that in general reference more numbers.</p> <p style="padding-left: 30px;">Trust is inspired by interactions between human beings. It is an emotional connection that is created when people see, hear or experience directly an event that instills confidence that one person or entity is looking out for the best interests of the other. I think that business leaders need to start sharing numbers about the people inside of their organizations and the quality of their experience.&nbsp; Who are the people whose work goes in to creating the market cap numbers &ndash; who think up, make and sell the products?&nbsp; How do they feel about what they do, what is their experience of the workplace and how does that overall experience help them to do their job well?</p> <p style="padding-left: 30px;">If we want people to trust businesses &ndash; or any institution &ndash; we need to help them connect with the people who are a part of that institution. Within institutions <a class="text_01" title="Ethical Leadership" href="http://www.trustworthyleader.org/eng/Blog/17_A-Deep-Commitment-to-Ethical-Leadership.html" target="_blank">leaders</a> need to help people connect with each other, to create bonds of trust that will strengthen the organization and, as a wonderful side benefit, create positive stories that can be told to keep the trust building process going.</p> <p style="padding-left: 30px;">A number of people talked about the importance of the human resources staff and front line managers in building trust in organizations. I&rsquo;ve heard variations on these themes many times over the years. Commentators have decried the lack of support provided to HR departments, or cited the oft-quoted phrase &lsquo;people leave their manager, not the company&rsquo;. This becomes a way of directing attention, and in many cases blame, to these groups for the trust problems that exist in their organizations.</p> <p style="padding-left: 30px;">I can confidently say from my twenty-five plus years of experience looking at what makes some workplaces great that declining trust in business and other institutions is neither the responsibility of front line managers nor the human resources department.</p> <p style="padding-left: 30px;">The responsibility for declining trust in organizations rests squarely on the shoulders of leaders. And it is also the responsibility of leaders to rebuild trust in their organizations. Leaders need to tell better stories about what is working in their organizations, they need to be conversant in the positive numbers about the quality of the workplace and level of trust that exist and they need to provide support to front line managers and human resource departments, not blame.</p> <p style="padding-left: 30px;">Every front line manager who is unable to do his job well, unable to build high trust relationships with colleagues and direct reports, has a manager he reports to and it is her job to help that front line manager learn how to build trust. How? By being an excellent role model and mentor and building trust herself. And she learns from her manager who needs to be a role model for her. This keeps going to the desk of the CEO who holds ultimate responsibility for the quality of workplace culture in his/her organization. This is the story that needs to be told.</p> <p style="padding-left: 30px;">Front line managers are incredibly important in organizations yet they cannot create trust in an organization in which they themselves do not receive support. Human resources staff can counsel, train, and try to motivate front line managers, yet without institutional support and visible and vocal support from the company&rsquo;s leaders they will be unsuccessful in turning things around.</p> <p style="padding-left: 30px;">The most important support that a company&rsquo;s leaders can provide to people within their organizations is to be <a class="text_01" title="Starbucks CEO" href="http://www.trustworthyleader.org/eng/Blog/11_Strong-Coffee-Howard-Schultz-named-Fortune-s-2011-Businessperson-of-the-Year.html" target="_blank">trustworthy themselves</a>. There are many examples of great trustworthy leaders available to serve as role models for others. These people are actively involved in creating the culture of their organization &ndash; they are visible on the shop floor, in the manufacturing plant or in the design room. They talk with people about the importance of trust, what it means for the company and all stakeholders, and they praise people when they do a good job, holding them up as role models for others.</p> <p>The Summit on Restoring Trust in Business was a great addition to the ongoing work of so many people trying to strengthen people&rsquo;s ability to trust businesses and other institutions. The discussions were open, honest and challenging. I came away with three concepts that I will continue to use myself and reinforce in my talks.</p> <p>First, we need to tell the great trust stories that do exist in our organizations with as much detail and excitement as we use when talking about a scandal.</p> <p>Second, when asked about our organizations we should start by sharing trust numbers, rather than financial numbers, speaking about the quality of the workplace environment. These are the numbers that will enable people to make the emotional connection needed to create a bond of trust.</p> <p>Finally, we need to talk about leadership and the responsibility of leaders to create cultures in which trust will flourish &ndash; by being trustworthy themselves, speaking out about trust, praising and recognizing trust building behavior. Responsibility for the quality of the workplace environment rests squarely on a leader&rsquo;s shoulders, not those of the front line manager or HR department.</p> <p>Trust in business and all institutions will be strengthened when we engage in open and honest conversation about the importance of trust &ndash; sharing stories and numbers and shining the light on leaders who are great trust builders so that they can be examples for others.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/24_Restoring-Trust.html Lessons from Great Workplaces for Great Government and a Great Society <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Saturday, August 18, 2012<br /> <p>There&rsquo;s no shortage of political discussion this time of year and of course much of it is focused on creating economic stability. Many people start their arguments by saying that economic stability is good. Most of us don&rsquo;t step back and ask the question &lsquo;why is economic stability good&rsquo; &ndash; we simply know that it is.</p> <p>Thankfully, a few people have stepped back to ask the &lsquo;why&rsquo; question. They&rsquo;ve produced some powerful <a class="text_01" title="Prosperity for All" href="http://www.seiu.org/2012/08/prosperity-economics-building-an-economy-for-all.php" target="_blank">reports</a> that document the benefits of broad based economic development for the many that creates economic stability for the society as a whole. The stability they cite is not a stability based in poverty for the many and wealth for the few. It is the stability that comes with economic well-being for as many people as possible.</p> <p>This may seem to be an obvious point yet at times the obvious point needs to be made to crystallize the argument.</p> <p>Economic stability for a particular society could involve many people being poor and a few people being very rich &ndash; and the system could hypothetically be stable with not much change in the percentage of people who are poor and the percentage of people who are very rich. Significant controls would probably need to be in place for a semblance of stability to exist yet hypothetically it&rsquo;s possible.</p> <p>Yet when most of us argue for a society with economic stability we talk about the benefits that come from a strong vibrant middle class, and lower limits on the number of people in poverty. We even argue for limits on how poor any person ought to be and vote to establish programs that will keep people from going below those limits. Economic stability in this case means economic well-being for the many.</p> <p><em>Where government is responsive to the broad citizenry, countries are far better at doing the things that create long-term growth, like investing in education and infrastructure, and ensuring that economic gains translate into a better quality of life for all citizens.</em> (<a class="text_01" title="Prosperity Economics" href="http://www.politico.com/news/stories/0812/79304.html" target="_blank">Politico</a>)</p> <p>Businesses do the same thing. They seek economic stability because business leaders know that economic stability is what enables an organization to develop its resources &ndash; human and material &ndash; so that great inventions, products and services can be created. And it is this cycle of stability leading to creativity leading to new products and services that enables a business to be profitable and keep the system flourishing.</p> <p>The 100 Best Companies are as a group and over time great examples of the power of creating economic stability for the many. They are pioneers in developing systems to <a class="text_01" title="We The Owners" href="http://www.fed.org/fed-books-and-films-films" target="_blank">create and share wealth</a> with the people who work there, with over 40 of the current Best Companies having an ESOP or ESPP plan. Other Best Companies offer profit sharing programs, contribute to employees 401k or 403b plans and support the financial stability of their employees in many ways.</p> <p>Why do they do this? Because leaders in these companies not only believe that fair sharing is vital to the creation of a cohesive work force, they also know that creating economic stability and well-being inside the organization leads to financial success for shareholders.</p> <p><a class="text_01" title="Benefits of Best Companies" href="http://www.greatplacetowork.com/our-approach/what-are-the-benefits-great-workplaces" target="_blank">Best Companies</a> have lower turnover than their industry peers, an easier time recruiting with more applicants for job openings, provide more training to employees, and are involved in significant community service initiatives. And they achieve significantly better financial performance than their peers.</p> <p>They do this with credible leaders who treat people with respect and promote fairness in their organizations. Practices that promote fairness and organizational success include fair pay and profit sharing, fair sharing of benefits and recognition, fair promotion practices and a fair appeals process.</p> <p>Economic stability that supports a vibrant middle class, and places limits on poverty and support to those in need works.&nbsp; And what happens to those at the very top? In the Best Companies, senior leaders do not suffer from economic distress because of low wages or a lack of health insurance. They are paid well by anyone&rsquo;s measure. AND so are other people in these businesses &ndash; especially relative to the larger population of companies out there.</p> <p>Senior leaders at Best Companies go out of their way to figure out how to share. They share wealth, benefits, training and other forms of support.&nbsp; And many of them take the first cut when times are tough &ndash; reducing their own salaries more than others. Many have set up systems where those with more money pay a higher proportion of their health care costs than those with fewer resources &ndash; because they value prosperity and stability for the many, not the few.</p> <p>A great business is one in which everyone has the opportunity to benefit. A great society should be the same.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/23_Lessons-from-Great-Workplaces-for-Great-Government-and-a-Great-Society.html Is Money the Only Currency with Value? <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Wednesday, July 11, 2012<br /> <p>A number of years ago a joke was making its way around a number of companies (especially in California where I live) about people being paid in psychic income. That is, they received benefits at work that included things like office snacks, the ability to travel, training and development opportunities, free lunch on Fridays, etc. These non-cash, work related benefits were said to provide an additional form of income for people beyond cash &ndash; and people were supposed to be better off because of this.</p> <p>The joke that was told about this though said something different. The joke was of the implication that the &lsquo;boss&rsquo; was actually fooling people by extolling the virtues of psychic income while at the same time lining his or her pockets with more of what was really valuable &ndash; cash.</p> <p>Money is supposed to represent an exchange mechanism. Money allows the people who have it to exchange it for something else they might need or want.&nbsp; For many people their ability to exchange money for things they want is quite limited because they only have enough to exchange for the things they need &ndash; food, clothing, shelter &ndash; pretty basic stuff. The things they want &ndash; health insurance, savings for their future, books to read, free time &ndash; are out of reach. Even though many of us consider these to be basic human needs for others they are simply &lsquo;wants&rsquo; that they can&rsquo;t have.</p> <p>There are many social, economic and environmental dilemmas facing this world right now and trying to figure out how to respond can be overwhelming. Some people put their head in the sand and try to pretend that the dilemmas don&rsquo;t exist. Others hide behind old-fashioned arguments for practices that, simply put, are incredibly destructive.</p> <p>For example, that oft-quoted line about a company&rsquo;s only responsibility being to make money for shareholders is used in a round about way to justify the pay packages of senior executives. The argument goes that the important leaders at the top would leave if they didn&rsquo;t get the pay packages they do, the companies are making money for shareholders, therefore the pay packages are justified. Never mind the reality that some people seem to get paid a lot even when their companies lose money &ndash; and that the turnover that someone should really worry about is from the rank and file, the key people and teams who make things happen inside organizations.&nbsp;</p> <p>Is anyone challenging this round-about executive pay argument? I think so, and I think lots of other companies could learn from these examples. Among the 100 Best Companies as a group, 70% of employees believe that they receive a fair share of the profits made in their organizations, and 77% believe that people in their organizations are paid fairly for the work they do. This data is from anonymous employee surveys administered for the 100 Best Company selection process from 2004-2012.</p> <p>For comparison, we can look at the responses from employees in the Lower 100 companies &ndash; good companies who apply for the list, yet don&rsquo;t make it. These are companies in which many things are working well, senior leaders are showing an interest in improving the quality of the workplace and employees are treated with a level of respect still missing in many workplaces. &nbsp;Yet perceptions of fair pay are not as high for people who work in the Lower 100 companies as among the 100 Best. Specifically, 49% of employees believe that they receive a fair share of the profits made by their organizations and 62% believe that people are paid fairly for the work they do.</p> <p>Based on the figures above we can see that on average, in a 100 Best Company, 21 out of 100 <strong>more</strong> employees perceive that people receive a fair share of the profits. Every company on the 100 Best list has at least 1000 employees so that actually means that at least <strong>210 more employees out of 1000</strong> perceive that profit sharing is fair - and 150 more out of 1000 believe that people are paid fairly. These are huge differences.</p> <p>Does it matter? I think so. We know that the publicly traded companies on the <a class="text_01" title="Financial performance of 100 Best" href="http://www.greatplacetowork.com/our-approach/what-are-the-benefits-great-workplaces" target="_blank">100 Best list significantly outperform their peers</a>. From 1998 to 2012 &ndash; looking at the entire history of the 100 Best list as published in Fortune magazine - the Best Companies have achieved an annualized return of 10.32%, while the S&amp;P has achieved an annualized return of 3.71%.&nbsp; The 100 Best are doing a significantly better job of making money for their shareholders.</p> <p>When we look at the performance of the 100 Best and the Lower 100 we see similar differences though not quite as stark. From 2004-2011 the 100 Best achieved an annualized return of 14.97% while the Lower 100 have seen an annualized return of 9.88%. A notable difference in performance that many company leaders claim to be trying hard to achieve.</p> <p>Perhaps an important first step toward achieving better performance would be to address questions of fair pay and profit sharing, including executive pay. Employees at the Best Companies are telling the world that pay and profit sharing matter. But it&rsquo;s not just about money. It&rsquo;s about fairness.</p> <p>Senior executives at 100 Best Companies are not suffering from a lack of money due to inadequate salaries, and they receive generous profit sharing packages if their companies offer it.&nbsp; Just like at most other companies. Many people who look at executive pay would say they are paid fairly.</p> <p>The big difference between the 100 Best Companies and everyone else is that at these companies many, many employees believe that they themselves are also paid fairly, and that they receive a fair share of the profits made by the organization. &nbsp;And their companies, as a group and over time, are making more money for shareholders.</p> <p>So is money the only currency with value? I think not. I believe that &lsquo;fairness&rsquo; is a currency of tremendous value that is too often ignored. People looking to run profitable companies &ndash; Boards of Directors, CEOs, senior executives, venture fund managers, entrepreneurs &ndash; would be wise to look at how well they understand and utilize the currency of fairness in their organizations.</p> <p>Here&rsquo;s a challenge: if you are well paid, and in a position to say yes or no to receiving more pay and a greater share of the profits from your organization, before you say yes, look into the fairness with which pay and profit sharing are distributed within your organization. If you are not close to the numbers discussed above from employees at the 100 Best Companies &ndash; those companies beating the pants off of everyone else in the stock market &ndash; then perhaps you should say no to more pay and profit sharing for yourself, and look for ways to provide more pay and profit sharing to others. You will likely suffer very little, and others could benefit greatly &ndash; in both the currency of money, and the currency of fairness.</p> <p>If you are a venture capitalist, looking to make your next successful investment in a company you hope will be profitable, go public, and provide you with a significant return on investment, make sure you understand how the currency of fairness is distributed within that company in terms of executive pay relative to everyone else's pay before you invest.</p> <p>If you are a Board member, especially one on the committee concerned with executive pay, and you are looking to uphold your fiduciary duty to shareholders then you absolutely need to be well versed in how the currency of fairness is distributed throughout the organization. The information cited above is public knowledge and has been for a long time. The publicly traded 100 Best Companies make more money for shareholders and more people who work in those organizations &ndash; from hourly clerical up to senior executive - believe that they are paid fairly and receive a fair share of the profits than in other organizations.</p> <p>If those who can do something about this take up the challenge then the joke that gets told about psychic income won&rsquo;t be a joke any more.&nbsp; People will get both the cash value of money and profit sharing, along with the psychic value of fairness. From the examples of the 100 Best Companies we can assume that everyone will benefit.</p> <p>&nbsp;***************</p> <p>For more articles and research papers that document the benefits of being one of the Best please visit the <a class="text_01" href="http://www.trustworthyleader.org/eng/Resources.html">Resources</a> section of this website.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/22_Is-Money-the-Only-Currency-with-Value-.html Small Business Success Story <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Sunday, June 10, 2012<br /> <p>In My Own Backyard:</p> <p>Small businesses are often cited as the backbone of communities, providing local jobs, supporting local events, and integrating themselves into the fabric of people&rsquo;s lives. They also have their share of struggles as many small businesses are family owned with limited resources and access to capital. Many of us shop at community-based stores and a growing &lsquo;shop local&rsquo; movement has raised the profile of many of these businesses.</p> <p>One small business success story, <a class="text_01" title="Cole Hardware" href="http://www.colehardware.com/" target="_blank">Cole Hardware</a>, exists in my own backyard in San Francisco. Founder Dave Karp was <a class="text_01" title="Dave Karp" href="http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2012/06/09/MNLJ1OU1GN.DTL" target="_blank">profiled</a> today in the San Francisco Chronicle as part of Cole Hardware&rsquo;s celebration of his 96th birthday. Dave and his son Rick, (now President) often have wise advice to offer small business owners just starting out, and those who&rsquo;d like to see their business become as successful as this one. Both of them are trustworthy leaders who communicate the honor of leadership through their <a class="text_01" title="Cole Hardware history" href="http://www.colehardware.com/ourcompany/history3.php" target="_blank">business operations</a>.</p> <p>Cole Hardware was founded in 1961 and one of the first things Dave Karp did was put a sign up on the cash register that said, &ldquo;There are no strangers here, only friends we haven&rsquo;t met.&rdquo; The sign was prompted by Dave Karp&rsquo;s early lessons in leadership &ndash; lessons about what not to do. He took those early negative experiences and turned them around once he had the chance to make his own choices.</p> <p>Dave Karp&rsquo;s decisiveness about how he wanted to run his business, represented in this initial act to insure that all customers felt welcomed, was likely a significant starting point for the company&rsquo;s long-term success. Small actions like this define the leadership stance that one will follow. In this case Dave Karp&rsquo;s leadership stance started his process of becoming a trustworthy leader, bringing with it all the benefits that come to people who are trustworthy.</p> <p>Cole Hardware has four stores in San Francisco. They are always bustling with customers. Employees are involved in community events, and the stores themselves run rebate and donation programs to help schools and other non-profit groups. Employees are regularly featured in company newsletters and promotional materials and are sought out by customers with all kinds of questions about how to fix something, create something or solve a dilemma. They are trusted.</p> <p>They&rsquo;ve had their bumps, like any business, yet have gone forward &ndash; moving through the uncertainty of business life with an eye clearly on the greater good &ndash; seeking to run a successful community based business that provides great service and brings out the best in people.</p> <p>The contributions that Cole Hardware has made to the neighborhoods where its stores are located and to the San Francisco community are tremendous. Besides steady employment, support for community events, environmental education programs and lots of support for non-profits, they are a wonderful small business success story. Facing all the ups and downs of business life, Dave and Rick Karp go forward, leading from their trustworthy stance, and insuring that people go with them and enjoy the benefits of what they have all created.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/21_Small-Business-Success-Story.html Strategic Leadership: Sharing Information to Grow Your Business <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Wednesday, May 9, 2012<br /> <p>As I was reading this great <a class="text_01" title="Small Business Success" href="http://www.nytimes.com/2012/05/10/business/smallbusiness/how-some-companies-expand-even-in-a-stalled-economy.html?ref=global-home" target="_blank">article</a> in the New York Times this morning it struck me that each of the business leaders profiled was using elements of the trustworthy leader's <a class="text_01" href="http://www.trustworthyleader.org/eng/The_Trustworthy_Leader_Book/The_Virtuous_Circle_of_Trustworthy_Leadership.html">Virtuous Circle</a> to strategically move through the uncertainties being faced by each business. It's not often that such a useful, timely example of the power of trustworthy leadership is available so I thought I'd use this story to illustrate both the practical steps a trustworthy leader takes to move through uncertainty and also the profound beliefs that rest behind an ability to take action.</p> <p>Small business owners can feel particularly pinched in a tough economy as every sale, every invoice makes a huge difference to business survival. When things get tight, the initial reaction may be to cut costs by reducing staff, cutting hours or changing product quality. Yet these actions don't set a company up for success when the economy picks up, can harm current sales that are still available, and can be hard for a business owner to swallow. Luckily the companies profiled in this article made other strategic choices &ndash; expansive choices that involved primarily engaging followers and sharing information &ndash; two key elements of the trustworthy leader&rsquo;s virtuous circle.</p> <p>At the first company profiled, <a class="text_01" title="Bandals" href="http://bandals.com/index.php" target="_blank">B<span class="text_01">andals</span></a>, a small business in Rochester, MN, founder Tom Sesti is looking for ways to respond to increased costs for raw materials and manufacturing expenses. He&rsquo;s conceptually clear on what needs to be done and knows his business well enough to do the initial market analysis that narrows his choices. What I noticed in the article as key to his strategic decision-making process and ability to move through the uncertainty he was facing is his willingness to share information with others who have a stake in the success of the business.</p> <p>He spoke with his sales team and retail customers about the options he was considering and their input helped him to choose to pursue two successful new strategies to help his business grow. While this might seem like a small part of the overall activity involved in pursuing success in a down market, these key linchpin activities are often what will make or break a brilliant opportunity.</p> <p>Many entrepreneurs have a great understanding of their product because they are the ones who came up with the idea, developed the prototypes, tested and sold the first products. Yet moving into the broader market, finding new customers and sales opportunities, working with suppliers &ndash; all of these activities can require strategic knowledge and skill outside of your scope. What do you do?</p> <p>You can try to come up to speed, learn everything and make the decisions yourself. Or you can respectfully engage followers - who have a stake in the success of the business &ndash; and share information with people in ways they can understand and use to participate in the discussion and influence the outcome. This key activity can provide a leader with the input he or she needs to make the best choice among options while faced with uncertainty.</p> <p>At the second business profiled, <a class="text_01" title="Odin" href="http://www.odinrfid.com/about/theodinstory" target="_blank">Odin</a>, we see further evidence of the success of trustworthy leadership. Odin was founded in 2002 to exploit the opportunities that a new technology, RFID or radio frequency identification, could bring to the marketplace. In 2009 the company was being squeezed by the slow economy and their own long product sales cycle. Having already reduced overhead expenses by 15%, CEO Patrick Sweeney knew that further cuts would not help the company move forward. So he decided to look for other uses of his current product &ndash; to try and expand his customer base. This choice is by itself an act of leadership - leaders are responsible for making the strategic choices that will enable their organizations to take advantage of opportunities on the other side of uncertainty. Whether or not a leader is successful is, I believe, greatly determined by his or her practice of trustworthy leadership.</p> <p>In the case of Odin and Sweeney it appears that success was achieved. And what did Sweeney do to insure that his strategy for moving through uncertainty &ndash; finding new uses for a current product &ndash; would be successful? He called together the top seven executives at his firm for a day long brainstorming session. They suggested, evaluated, debated and ultimately decided upon a small group of ideas to pursue. The brainstorming meeting was one step in the full process of trustworthy leadership that lead to success, yet it is key.</p> <p>What I noticed in reading through the brief account covered in the NYTimes article is how a leader engaged his followers and shared information in such a way that people could use it, participate with it and influence the outcome. Sweeney engaged his followers (some might say colleagues which is exactly how a trustworthy leader sees his/her followers) by inviting them in, asking them to accompany him and each other, and by staying connected with everyone as they evaluated the options before them. He shared information with people and they all shared it right back with each other &ndash; everyone benefited.</p> <p>This is what happens when leaders move through their virtuous circle of trustworthy leadership. My guess is that Sweeney did not consciously say that he is honored to be a leader and will include everyone prior to setting up the initial brainstorming meeting in which he engaged followers and shared information &ndash; yet that&rsquo;s what is happening here. I encourage people to read more about Odin as their business success appears to be notably intertwined with the successful practice of trustworthy leadership throughout the company.</p> <p>The third company highlighted in the NYTimes article is <a class="text_01" title="Credit Sesame" href="http://www.creditsesame.com/" target="_blank">Credit Sesame</a>, a financial services firm that helps individuals to make smart decisions about loan terms and debt management. Founder Adrian Nazari has been through the ups and downs of the economic roller coaster during the past seven years with his initial business, Financial Crossing, reaching out to banks as their primary customers. With all of the changes in the banking industry during 2008 the business fell apart &ndash; yet Nazari knew that his product was sound and useful. So he did what all leaders need to do &ndash; tried to find a way through the uncertainty all around him to take advantage of opportunities he knew were out there.</p> <p>And Nazari &ndash; just like Sesti and Sweeney &ndash; took steps to engage his followers/colleagues and share information. As the article says, he and his management team studied market research, surveyed consumers and discussed options. Nazari took responsibility for making significant strategic decisions &ndash; like changing the company&rsquo;s target market from banks to individual consumers - yet others were engaged along the way and were given information that allowed them to participate and influence the outcome.</p> <p>Credit Sesame is still gathering steam yet the initial evidence is that their move through this particular moment of uncertainty will be successful. They have 24 employees and a growing customer base. The continued financial uncertainty faced by consumers and interest in tools that provide credit management solutions shows that Credit Sesame has tapped into a ready and growing market.</p> <p>All three of these stories are presented in the NYTimes article as small business success stories &ndash; and they certainly are that. Yet they are also powerful trustworthy leader success stories. In each case, the leaders of these small businesses faced significant moments of uncertainty when the strategic decisions they needed to make could go either way &ndash; towards success or failure. Relying on the elements of the <a class="text_01" href="http://www.trustworthyleader.org/eng/The_Trustworthy_Leader_Book/The_Virtuous_Circle_of_Trustworthy_Leadership.html">Virtuous Circle of Trustworthy Leadership</a> gave each leader, and each business, the strength needed to come out on top.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/20_Strategic-Leadership-Sharing-Information-to-Grow-Your-Business.html Inclusion - Practice What You Preach <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Tuesday, May 8, 2012<br /> <p>One of the key elements in the <a href="http://www.trustworthyleader.org/eng/The_Trustworthy_Leader_Book/The_Virtuous_Circle_of_Trustworthy_Leadership.html">Virtuous Circle</a> of a Trustworthy Leader that I write about in my book is inclusion. Inclusion is reflected in a trustworthy leader&rsquo;s commitment to being a leader for everyone, and finding ways to spend time with people throughout the organization - not just the &lsquo;high potentials&rsquo;, the people in the c-suite or the up and coming next generation leaders.&nbsp;</p> <p>Trustworthy leaders know that they need to connect with every person in the department, division or organization in order to be effective. They go out of their way to live up to the term &lsquo;leader&rsquo; and to acknowledge every person in the organization or group as someone who will be impacted by their leadership actions.</p> <p>During an interview for my book with Stew Leonard Jr. (President and CEO of Stew Leonard&rsquo;s, a regional grocery chain on the east coast) he talked about a recent training workshop he had been to in which the workshop leader kept talking about the importance of promoting leadership training to the &lsquo;C-suite&rsquo;. Stew joked that he didn&rsquo;t even know what the &lsquo;C-suite&rsquo; was at Stew Leonard&rsquo;s because leaders spent so much time out on the floor with everyone.</p> <p>&ldquo;I told her that I hoped we never had a C-suite&rsquo; at Stew Leonard&rsquo;s. You really want a floor-suite where everyone&rsquo;s on the floor.&nbsp; You can&rsquo;t operate all the time like that, but for me it&rsquo;s an example of the importance of being connected to the front line and what&rsquo;s happening with customers. &ldquo;</p> <p>Stew&rsquo;s wisdom is something that many leaders can miss out on as they learn and grow into their leadership responsibilities. With so much specialized attention placed on identifying and singling out a few individuals for high intensity leadership training and career development the importance of connecting with people &ndash; as an act of leadership - can be overlooked.&nbsp;</p> <p>A focus on &lsquo;high performance&rsquo; conveys an image of needing to be fast paced, always on, making decisions quickly and moving on to the next project. &nbsp;Yet when do you talk with people, connect with those who are supposed to be following your lead? Why would someone follow you if they don&rsquo;t really know who you are and, more importantly, if they aren&rsquo;t sure that you know or care about them and their own learning and development?</p> <p>Beside&rsquo;s encouraging all leaders at Stew Leonard&rsquo;s to spend time on the floor with employees and customers, training and career development are offered to everyone. Leaders and managers, in collaboration with the training department, meet with people to talk about what they can aspire to from their current position. Leaders talk with team members about their interests and goals and share career ladders that provide guidance on ways each individual can move forward in the workplace.</p> <p>Lots of people are familiar with the saying &lsquo;people are our most important asset&rsquo;. Yet actions speak louder than words. What are you doing in your leadership practice that let&rsquo;s people know that people in your company are the most important asset?</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/19_Inclusion-Practice-What-You-Preach.html Looking to Improve ROI – Check Your Safety and Wellness Programs <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Thursday, April 5, 2012<br /> <p>A few years ago Michael Behm, an associate professor at East Carolina University involved in the study of occupational health and safety contacted me about an idea he had for a research study. He wanted to look at the health and safety records of 100 Best Companies and see how they compared with generally available data on the occupational health and safety practices found in comparable companies not known as great workplaces. His <a class="text_01" title="Behm-Occupational Safety and Health" href="http://ecu.academia.edu/Behm/Papers/564184/Employee_Morale_Examining_the_Link_to_Occupational_Safety_and_Health" target="_blank">study</a> resulted in a paper that documents the positive link between employee morale, a firm&rsquo;s active and visible support for safety programs, and improved return on investment.</p> <p>Another article that recently came to my attention comes at the same topic from a different angle by simply extrapolating and documenting the extraordinary high cost of occupational illness and injury in the United States. This <a class="text_01" title="Economic Burden of Occupational Illness and Injury" href="http://onlinelibrary.wiley.com/doi/10.1111/j.1468-0009.2011.00648.x/abstract" target="_blank">study</a>, presented by J. Paul Leigh, a professor of Health Economics at the Center for Healthcare Policy and Research at the UCDavis Department of Public Health Services quantifies the financial burden faced by companies and the US healthcare system for occupational injuries and fatalities. Leigh&rsquo;s research doesn&rsquo;t look at ways to prevent or minimize occupational illnesses and injuries &ndash; he simply makes us all aware, with significant documentation, of the negative effects of lax workplace safety programs and poor or non-existent efforts to promote employee wellness.</p> <p>His conclusion is dramatic yet also plain spoke and direct: &ldquo;<em>The medical and indirect costs of occupational injuries and illnesses are sizable, at least as large as the cost of cancer. Workers&rsquo; compensation covers less than 25 percent of these costs, so all members of society share the burden. The contributions of job-related injuries and illnesses to the overall cost of medical care and ill health are greater than generally assumed.</em>&rdquo; Most of us have seen news stories about the &lsquo;cost burden&rsquo; society carries because of the explosive rise of cancer cases and treatment. Now we know that a comparable &lsquo;cost burden&rsquo; comes from occupational injuries and illnesses.</p> <p><strong>Compare and Contrast</strong></p> <p>To bring the findings of these two studies down to ground level, we can consider the findings of an <a class="text_01" title="McWane and ACIPCO" href="http://www.pbs.org/wgbh/pages/frontline/shows/workplace/mcwane/two.html" target="_blank">investigative report</a> prepared by the New York Times, Frontline and the Canadian Broadcasting Corporation released in 2003. This report compared the consequences of health and safety practices at AMERICAN Cast Iron and Pipe company, (formerly known as ACIPCO) and McWane Inc. These companies are both over 100 years old, both located in Birmingham, Alabama and both make, among other things, cast-iron water and sewer pipes. The similarities end there.</p> <p>McWane industries has had one of the worst health and safety records in its industry for years, with the high cost of their poor practices felt most keenly by workers &ndash; and perhaps also the city of Birmingham and state of Alabama where much of the &lsquo;cost burden&rsquo; of their poor practices was absorbed by individuals, families and communities.</p> <p>AMERICAN on the other hand has long been known as an exemplary employer with state of the art health and safety practices that have benefited employees, the company, community and state. At the time of the 2003 report there really could not have been two more divergent approaches to health and safety found anywhere.</p> <p>The consequences of that investigative report didn&rsquo;t change anything at AMERICAN &ndash; they&rsquo;ve continued to promote health and safety with as much zeal and success as always. Things have been changing at McWane though, with new management, new programs and a vocal commitment to health and safety. Some improvements have been noted with a number of plants admitted into OSHA&rsquo;s Voluntary Protection Program in recognition of their strong health and safety programs. There continues to be much improvement needed.</p> <p>While both AMERICAN and McWane are financially successful companies the cost burden born by McWane because of their weaker health and safety record is tremendous &ndash; as is the cost burden taken on by the communities in which it&rsquo;s plants operates. This is a much harder financial figure to comprehend as the Leigh study cited above affirms &ndash; it is very difficult to get accurate data on the high costs associated with poor occupational health and safety programs. How much more successful would McWane be if they had an improved health and safety record &ndash; one matching that of AMERICAN? Hard to know. And how much &lsquo;healthier&rsquo; would the communities be in which they operate? Again, hard to know.</p> <p><strong>Benefits from Safety</strong></p> <p>Yet if we go back to the Behm study, we can see some the possible benefits that can come to organizations that actively promote occupational health and safety programs. A <a class="text_01" title="OSHA Study on Health and Safety" href="http://www.osha.gov/Publications/safety-health-addvalue.html" target="_blank">2002 OSHA</a> study indicating that workplaces with active, visible safety leadership have fewer injuries, are often rated as better places to work, and have more satisfied, more productive employees who are less likely to change jobs is what originally prompted Behm to seek out 100 Best Companies data.</p> <p>Behm wanted to see if he could present a more rigorous argument for the benefits that come to organizations with strong health and safety programs. His findings did not disappoint him. &nbsp;&nbsp;&ldquo;<em>Occupational safety and health performance and management is a significant component of employee morale [and] this [supports] the previous anecdotal claims. Organizations with high levels of employee morale have fewer OSHA inspections due to accidents or complaints, serious, willful or repeat violations, and lower monetary penalties</em>.&rdquo;</p> <p>How can you put some of the findings of Behms&rsquo; study into practice so that your own organization will benefit from strong wellness and safety programs? And also gain some of the benefits found at AMERICAN Cast Iron and Pipe Company, while reducing the significant costs documented in Leigh&rsquo;s study of the burden of occupational illness and injury on the US economy?</p> <p><strong>A Positive Approach to Wellness</strong></p> <p>One place to look is <a class="text_01" title="Health and Wellness at Lincoln Industries" href="http://lincolnindustries.com/home/2011/10/01/is-wellness-a-fit-for-small-business/" target="_blank">Lincoln Industries</a>, a Lincoln, Nebraska metal finishing business that has received frequent recognition for the quality of its workplace (including as a Best Small and Medium Workplace) as well as recognition for the positive impact of their safety, health and wellness programs.</p> <p>Lincoln&rsquo;s worksite wellness program, added in 1989, has produced notable returns on investment for many years. &nbsp;Every company newsletter includes a wellness tip and an environmental tip, with both often including a safety focus to their topics. The company Wellness program - called <a class="text_01" title="go! Platinum" href="http://lincolnindustries.com/home/who-we-are/wellness/" target="_blank">go!Platinum</a> - promotes the health and well-being of all people at Lincoln Industries. In June 2011 the company announced that they would be opening an on-site workplace health center to provide medical services at no cost to employees, their spouses and children over 12 who are enrolled in the company&rsquo;s medical insurance plan. &nbsp;Services will include both the treatment of minor illnesses and injuries as well as health coaching to promote healthy lifestyle choices. Health, wellness and safety are taken seriously at this company.</p> <p>In 2004 Lincoln&rsquo;s Wellness program is credited with helping to lower the number of people who smoke tobacco from 42% to 15%. &nbsp;In 2005 Lincoln&rsquo;s program provided a 5 to 1 return on investment and saved the company 21 million dollars while reducing lifestyle associated medical claims, workers compensation claims and health insurance costs. &nbsp;The company&rsquo;s annual health-care costs have averaged 30% less than those of other Midwestern employers in the same industry and of the same size.</p> <p>All of this is significant and points the way towards efforts your own company can make to improve its overall return on investment, avoid the negatives of occupational injury and illness, promote people&rsquo;s health and well being, and improve employee morale. What are you waiting for?</p> <p>Amy Lyman is co-founder of Great Place to Work&reg; Institute and author of The Trustworthy Leader (&copy;2012 Jossey-Bass)</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/18_Looking-to-Improve-ROI-Check-Your-Safety-and-Wellness-Programs.html A Deep Commitment to Ethical Leadership <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Thursday, March 15, 2012<br /> <p><strong>Who are you looking for?</strong></p> <p>I was recently talking with a colleague about how colleges and training programs can best prepare students for the workforce. We weren&rsquo;t talking about the specific kinds of preparation needed in terms of job skills or industry specific knowledge though. We were talking about preparation for the ethical and moral choices that people need to make at work and the increased attention that many workplaces are paying to questions of culture and values in their hiring decisions.</p> <p>Our conversation prompted me to look through the materials collected at the Great Place to Work Institute as part of the <a class="text_01" title="Best Companies Selection Process" href="http://www.greatplacetowork.com/best-companies/about-applying-to-best-companies-lists" target="_blank">Best Companies selection process</a>, specifically the Culture Audit data on hiring practices, and the employee survey data about the welcoming of new hires.</p> <p>I also of course thought about all of this through the lens of trustworthy leadership as a leader&rsquo;s active involvement in the design and development of company culture will help to determine who is attracted to the workplace, who chooses to stay, and how well the company&rsquo;s culture will be carried out through the actions of all employees. Trustworthy leaders are the ones best able to create and sustain positive workplace cultures that create great experiences for employees and support positive ethical and moral decision-making.</p> <p>What I found was heartening and challenging. Heartening in the sense that so many companies are so explicit about the importance of looking for culture fit during the hiring process &ndash; especially many of the small and medium sized companies. The challenging piece comes from thinking about how we can best help young people to understand what these great companies are looking for in terms of values-based decision making.</p> <p>I am also always challenged by the question of how to help more leaders understand the absolute importance of their own commitment to lead with integrity. When leaders live and lead by the values and culture they espouse they are able to create and direct tremendous energy towards the success of their own organizations. &nbsp;</p> <p><strong>Did you ever own a red wagon when you were a kid?</strong></p> <p>One of the companies that I was particularly impressed with is <a class="text_01" title="Radio Flyer" href="http://www.radioflyer.com/" target="_blank">Radio Flyer</a> (#7 on the 2011 Best Small &amp; Medium Workplaces <a class="text_01" title="2011 Best Small &amp; Medium Workplaces" href="http://www.greatplacetowork.com/best-companies/2011-the-great-place-to-workr-rankings-the-best-small-a-medium-workplaces-presented-by-entrepreneurr-/678" target="_blank">list</a>). They make those great red wagons that represent such iconic images of childhood dreams and fun. They are a small company &ndash; just under 70 employees in the United States and about 60 employees in China &ndash; yet their recruiting and hiring practices could easily compete with companies of any size in terms of the thorough and detailed approach they take to finding the right people to fit into their very special organization.</p> <p>They let people know what and who they are looking for very directly &ndash; on their website, in their recruiting materials and during the interview process. They start off by saying that they are looking for people who &ldquo;<em>live our values and who can deeply commit to our values</em>&ldquo;. &nbsp;While the values are consistent with those of many companies:</p> <p style="padding-left: 30px;">Integrity in all we do.<br /> Accountability to ourselves and others.<br /> Passion for excellence.<br /> "Can Do" attitude.<br /> Fast, Friendly and Effective service.<br /> Having fun, spreading smiles.</p> <p>...what happens during the hiring process to find the right people who can commit to those values is quite unique.</p> <p>People interested in working at Radio Flyer participate in many interviews. During the interviews they are asked to respond to questions matched to each value and linked with a set of desired behaviors. Responses should indicate to the hiring manager that the applicant could behave in such a way that the applicant could deeply commit to that value.</p> <p>Yet at Radio Flyer they are looking for something more than the words &ndash; they are looking for someone who can say, &ldquo;I want this job. This will be the best job I&rsquo;ve ever had.&rdquo;&nbsp; They say that an open position is better than hiring someone who doesn&rsquo;t fit with the culture of the company and they actively encourage people to scrutinize their own motivation for wanting to work at Radio Flyer. Because when they hire someone, they want that person to stay for a long time.</p> <p><strong>Engendering a deep commitment</strong></p> <p>Deeply committing to anything takes significant effort, and people new to making a commitment usually look to those with more experience to see how they&rsquo;ve done it. New hires in any organization will look to longer tenured employees to see what it really means to be &lsquo;deeply committed&rsquo; to a set of values. If leaders and managers in the organization walk the talk then those new hires will have great teachers to learn from, yet if leaders and managers say one thing and do another then pretty soon the same thing will happen with new hires &ndash; they&rsquo;ll either settle in to &lsquo;just another job&rsquo;, start following what leaders really do, not what they say, or they&rsquo;ll leave the company.</p> <p>At Radio Flyer it&rsquo;s not &lsquo;just another job&rsquo;. They are doing many things right and their low turnover and over 7400 job applicants last year alone testify to the attractiveness of the workplace culture that they have created and everyone upholds.&nbsp; The final part of the interview process for every potential new employee is a meeting with the CWO (that&rsquo;s Chief Wagon Officer). His personal responsibility is to provide a final assessment of the candidate&rsquo;s ability to deeply commit to the values of the organization. In part he does this by letting people know of his own deep commitment to the values and how he holds himself accountable.</p> <p>When leaders actions match their words, and they act in ways that are consistent with the values they and others in their organization espouse, the power of the workplace culture they can create is magnified significantly. When leaders stray from those values, acting inconsistently or undermining the values they claim to stand for, the damage is tremendous.&nbsp; Leaders at Radio Flyer represent one small company among many where people have set for themselves the task of leading by example. &nbsp;They get it right, they reinforce for new employees how to live and commit to the company values on a daily basis, and they create really cool red wagons!</p> <p>&nbsp;</p> <p>Amy Lyman is co-founder of Great Place to Work&reg; Institute and author of <em>The Trustworthy Leader</em> (&copy;2012 Jossey-Bass)</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/17_A-Deep-Commitment-to-Ethical-Leadership.html Developing a Sense of Honor <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Wednesday, February 29, 2012<br /> <p>One of the nice surprises that I experienced during the interviews I conducted for my book came when the leaders I was talking with used the term &lsquo;honor&rsquo; as a way of describing how it felt to be a leader. What was surprising was the way they were using that term &ndash; not to describe an external experience of honor, or an award, they had received because of the position they held, but to describe how they felt personally, internally, about their work. It is a profound distinction in orientation that I believe is at the heart of what makes a trustworthy leader so effective in his/her role.</p> <p>There are many ways that these leaders developed their own understanding of honor, with all of them coming through an experience involving interactions with others. Developing a sense of the honor of one&rsquo;s work is not a solo act &ndash; as with all leadership development it requires interaction. And it starts early in one&rsquo;s work career.</p> <p>Many first-time work experiences are in positions that are classified as entry level, low wage, or low responsibility. The tasks linked to these jobs are often described as repetitive or menial and performance of these tasks is generally not honored or rewarded externally. Yet many entry-level positions carry significant responsibility for personal interaction and create the first impression that a customer or client will have of your organization.</p> <p>Think of all of the call center people in entry-level positions answering questions about a product or service, the cashier at the supermarket helping you with your groceries, the server giving you your fast-food, or the parking lot attendant directing you to a spot for your car. These people engage in direct, specific and potentially helpful interactions with customers. The quality of the interaction will create an impression that the customer will associate with whatever product or service was consumed - and with your company.</p> <p style="padding-left: 30px;">Jack DePeters, Wegman&rsquo;s SVP Operations: <em>I joked when we won the number one spot [</em>on the 100 Best Companies to Work for list<em>] that we were a three billion dollar company being run by 15-16 year old cashiers.&nbsp; A lot of people didn&rsquo;t like that.&nbsp; But wait a minute, at the end of the day, it&rsquo;s true.&nbsp; And if you don&rsquo;t get it, then you don&rsquo;t know the job of that front end.&nbsp; Because that is where the customer is transacting their money.&nbsp; That&rsquo;s where they are giving you the hard green. And you better be doing it right.</em></p> <p>If leaders within your organization treat the person in this entry-level position poorly then the internalized message of that poor treatment will be conveyed to others. If the person is simply treated as if her position is insignificant then where would she find the motivation to make her work significant?&nbsp;&nbsp; If he is treated as if he personally doesn&rsquo;t matter, he just needs to get the task done, then how can he convey to the customer that she&rsquo;s important, that her needs matter?</p> <p>It is very difficult to create in oneself the personal strength to counter the weight of a leader&rsquo;s message about the value of your work when you have just entered the work world or are starting a new position. And so many people find themselves in entry-level positions in which they are told that their particular work, their personal contribution, is meaningless. Why is that?</p> <p style="padding-left: 30px;">Chris Van Gorder CEO Scripps Health: <em>When I was a security guard, not at Scripps, somewhere else, I was about as low on the totem pole as you can be. One night I saw the hospital administrator, recognized him by his photograph, walking down in the basement. I went, wow &ndash; I am going to get a shot at meeting this guy.&nbsp; And I will never forget what happened - he walked right by me as if I didn&rsquo;t even exist.&nbsp; There was nobody else there, and I remember how crushed I felt that the guy didn&rsquo;t even acknowledge me.&nbsp; I thought about it and thought, you know what?&nbsp; That&rsquo;s not right.&nbsp; Because if anything bad happens in this hospital right now, they are going to call me before they call him.&nbsp; Everyone has their role and their purpose in life, and sometimes, in fact most times, the people who are out there in the field doing our work are far more important than I will ever be</em>.&nbsp;</p> <p>Perhaps the person passing that message on was given the exact same message when she first started in the position years before. Perhaps she was threatened with dismissal if she didn&rsquo;t get the task done &ndash; because &lsquo;you&rsquo;re replaceable, there&rsquo;s nothing special about you, just do your job&rsquo;. The economic cost to the organization of these kinds of encounters is tremendous, and the cost to people&rsquo;s psyches is even greater.</p> <p>Yet all of this can be countered by a few simple gestures, a few simple comments from a leader or manager within an organization who sees an opportunity to help someone consider their work from a different perspective.</p> <p>If you want to try for yourself to do something about people&rsquo;s experience of honor in your own organization start with a few simple questions: How often do you sincerely say thank you to the receptionist who greets people who come into the building to meet with you. When you walk by people in the hallway do you acknowledge them, say hello, ask how their day is going? Do you know the name of the person who delivers your mail and can you thank him personally for doing his job so well?</p> <p style="padding-left: 30px;">Paul Purcel, CEO Robert W. Baird: <em>Everybody is not equal and they don&rsquo;t get paid the same, but everybody gets treated well so that they absolutely believe that what they do is important because it is.&nbsp; The mail guy is important.&nbsp; He&rsquo;s part of the game.&nbsp; You want the mail guy to be really good and you want the receptionist to be the best receptionist.&nbsp; You want everybody, no matter what their job is, to take pride in their job and believe that it makes a difference.&nbsp; You have to have a soul to do that.&nbsp; You have to believe that it&rsquo;s really important.&nbsp; You have to believe it&rsquo;s the right thing to do from a human point of view and you have to know that it&rsquo;s the right thing to do from a corporate strategy point of view.</em>&nbsp;</p> <p>It&rsquo;s not difficult to say thank you to someone yet first you need to notice people and what they&rsquo;ve done. You need to acknowledge their importance. That&rsquo;s how developing a sense of honor starts &ndash; with someone acknowledging an individual as a human being who is important and then acknowledging the particular contribution made by that unique person. This acknowledgement does often happen among colleagues - peers who support each other to get their work done knowing that the day will go better if they help each other.</p> <p>As a leader you need to be doing this as well &ndash; you will not only help others to develop a sense that their work in honorable, you will also begin to understand how deeply honorable your own work as a leader can be when you see the impact of your actions and words on others. Go find someone to thank. Do it sincerely and specifically letting the person know what particular contribution you are acknowledging and how the quality of their work has made a difference. Keep doing it, all week long. And then take some time to reflect on how your week has gone, whether or not it has felt any different &ndash; perhaps your own work experience will seem a bit more honorable.</p> <hr /> <p>For further information about the development of honor among trustworthy leaders please see this brief <a class="text_01" title="Learning about Honor" href="http://www.youtube.com/watch?v=2q2X42XKssA" target="_blank">youtube clip</a> from my discussion with Dan Mulhern.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/16_Developing-a-Sense-of-Honor.html Learning from the Best <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Monday, February 13, 2012<br /> <p>Many of the great joys of writing my book came during the interviews I conducted with leaders at great workplaces. It was always refreshing to hear leaders speak so passionately about the people for whom they worked &ndash; all the people throughout their organizations.</p> <p>I was reminded often of the goodness that exists in the world and so wished that more attention would be paid to these stories that I was hearing rather than the stories of deceit and destruction that regularly appear in the business press. We can learn from the wrongs committed in the world, yet in order to make improvements we need to learn from the successes as well &ndash; we need to know how to do it right.</p> <p>Clearly business leaders want to avoid layoffs, improve employee loyalty and customer retention, create innovative products and services and do so in ways that are of benefit to people&rsquo;s long term health and welfare. Yet how can we do that if all that we read about are the horror stories &ndash; people learning about layoffs over the phone with no advance warning, product recalls that occur after someone has become seriously ill due to lax quality control, pay disparities between the few and the many that reach 300 to 1.&nbsp; These may all be scenarios we wish to avoid in our own organizations, but how do we go forward when these stories are not ones to learn from, only ones to fear.</p> <p><strong>Did you win?</strong></p> <p>This was the question posed by Danny Wegman in his response to my curiosity about why he has chosen to lead the way he does. Danny is the Chairman and CEO of <a class="text_01" title="Wegmans #4 on 100 Best list" href="http://www.wegmans.com/webapp/wcs/stores/servlet/PressReleaseDetailView?langId=-1&amp;storeId=10052&amp;catalogId=10002&amp;productId=734552" target="_blank">Wegmans</a> Food Markets, a super-regional chain of grocery stores in the northeastern United States that was recently named #4 on the <a class="text_01" title="2012 100 Best Companies" href="http://www.greatplacetowork.com/best-companies/100-best-companies-to-work-for" target="_blank">2012 100 Best Companies to Work For</a> list published in Fortune magazine on January 19th.</p> <p>During my interview with Danny I asked him how it was that he has been able to be such a positive trustworthy leader when there is significant pressure and opportunity to do otherwise and make money. Many people argue that the reason business leaders are often harsh is because it is the only way to make money. Yet Danny disagreed, and Wegmans success is a testament to his approach to leadership.</p> <p>Danny believes that some things &ndash; like quarterly reports and business schools &ndash; get in the way of helping people to be human, and at Wegmans the way to make a profit is to be human. Quarterly reports create unrealistic expectations that a 3-month reporting cycle is a reasonable way to gauge the health of a business. Business schools often teach techniques yet do not help with reality &ndash; the bane of much academic study &ndash; you can learn ideas and concepts yet you also need to learn how to use them in support of humanity not to repress it.</p> <p><strong>Lead with your heart, not a calculator</strong></p> <p>The criticism of business schools is not solely Danny&rsquo;s as many people have leveled sharp words at the lessons provided to future managers and leaders. At Wegmans their approach to leadership begins with the idea that doing what&rsquo;s right is the most important first step in any situation. &ldquo;<em>We do things that we believe in, and if our customers like them, we make a profit.&nbsp; Otherwise we&rsquo;re just a hobby.&nbsp; That to me is the key thing:&nbsp; If you continually do what&rsquo;s right, your people understand that that is what they are supposed to do too</em>.&rdquo;</p> <p>Leadership training at Wegmans does exist in class format yet the bulk of leadership training is by example and on the job. People are shown how to lead with their heart, how to use a calculator for calculations, not for leadership, and they are routinely praised for doing the right thing.</p> <p>This is quite an astute strategy for business success, yet also quite simplistic &ndash; as Danny says. What is happening at Wegmans is that tools are used for their proper function. Lots of data is collected about store operations, special events and promotions, and profitability. This is where the calculators serve their purpose.</p> <p>Data is also collected &ndash; some of it quantitative and some of it qualitative &ndash; about all of the human activities involved in store operations. &ldquo;<em>What we do is not rocket science, it&rsquo;s a simplistic, homey way of doing things that works, and people hear that.</em>&rdquo; All of this data is used to help leaders at Wegmans understand the impact of their decisions on the overall functioning of the business &ndash; profitability of course, yet also employee satisfaction, customer loyalty, community reputation and the general quality of the work environment.</p> <p>And do they win? Yes, they do, in two distinct ways. First, in the sense that many financial analysts consider important, Wegmans is a profitable business in an industry that traditionally experiences low profit margins. Many of their peer organizations claim that the only way they can remain profitable is to pay lower wages, provide fewer benefits and squeeze price concessions from suppliers. None of those is an option at Wegmans.</p> <p>The way that Wegmans really wins though can be seen by their wonderful example of how to run a successful business by leading with your heart.</p> <p>Danny&rsquo;s commentary on this is better than anything I could summarize: "<em>Treating people the way you want to be treated yourself works.&nbsp; That is what our company is a testimony to &ndash; not to anyone else but only to ourselves.&nbsp; And we are just so happy that it works.&nbsp; I mean, what if getting up every day and being grumpy and yelling at people and whipping them proves to be a great financial success and you thought that was the model?&nbsp; Who would want to live like that?&nbsp; Gosh did you win?&nbsp; We&rsquo;re so blessed that we treat each other the way we want to be treated and it does work, and we say, wahoo, let&rsquo;s do more of that!</em> &ldquo;</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/15_Learning-from-the-Best.html The Benefits of Being a B-Corp <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Monday, February 6, 2012<br /> <p>A flurry of attention has been paid recently to the announcement that more states are enacting legislation allowing corporations to register as &lsquo;For-Benefit&rsquo; entities. This designation provides an organization&rsquo;s governing board the specific ability to consider social or environmental objectives, along with profit objectives, in its decision-making. The practice became law in California on January 1 with New York following on Feb 10th. Other states are already on board.</p> <p>What&rsquo;s the big deal? For some business owners and investors the ability to raise up social and environmental concerns to the same level as profit maximizing concerns is a breath of fresh air. The new laws will provide them with protection from potential lawsuits from investors who might otherwise challenge a governing board's decision if they are not seen as solely seeking to wring the greatest profit from every action.</p> <p>For others the new law is seen as a scam that directs attention away from the only goal of a business &ndash; to make money for shareholders. Yet that oft repeated phrase, &lsquo;the only business of a corporation is to maximize shareholder returns&rsquo;, attributed to many different people, should not be in conflict with the goals and results of well run For-Benefit corporations.</p> <p>In order for a for-profit business to make money, it needs to have a great product or service that people want to buy and use, it needs a great market strategy to sell and distribute the product or service efficiently, and it needs a positive reputation as an employer to attract and retain the best talent, create loyal customers and be well regarded in its communities. All of this can be accomplished within the B-Corporation structure.</p> <p>Rather than questioning the value of the new B-Corp laws going into effect, as a recent Wall St Journal article did (<a class="text_01" title="With New Law, Profits Take Back Seat" href="http://online.wsj.com/article/SB10001424052970203735304577168591470161630.html" target="_blank"><em>With New Law, Profits Take Back Seat</em></a>) we should be looking at all of the entities incorporated under current laws that are not living up to their charter.</p> <p>Every year, along with the release of the 100 Best Companies to Work For list in Fortune magazine, the Russell Investment Group provides the Great Place to Work Institute with information on the <a class="text_01" title="Best Companies Financial Performance" href="http://www.greatplacetowork.com/our-approach/what-are-the-benefits-great-workplaces" target="_blank">long-term financial performance</a> of the 100 Best Companies relative to the S&amp;P 500 and the Russell 3000. Since 1998, the publicly traded 100 Best Companies, as a group and over time, have outperformed the market significantly. From 1998-2011 the 100 Best have provided a 295.47% cumulative return compared with 73.72% for the Russell 3000 and 66.49% for the S&amp;P 500.</p> <p>Many of the public companies on the 100 Best list could easily reincorporate themselves as B-Corporations and continue running their businesses as they do right now. Their governing boards already consider social and environmental factors in their decision-making. These companies have created unique workplace environments where people want to come to work and where customers want to shop. And many community leaders are knocking on their doors asking them to set up shop in their hometowns. Why &ndash; because they are great companies that are successful. They make money, they care for people, they integrate environmental and social considerations into their business decisions &ndash; and they do all of these things at the same time.</p> <p>So what is the big concern with B-Corp legislation? Who are the people most concerned about it? Perhaps it&rsquo;s the people who still don&rsquo;t understand that taking care of people, taking care of the environment, looking at the long-term impact of your decisions on the health and well being of the communities in which you operate IS GOOD FOR BUSINESS.</p> <p>I am hopeful that B-Corp legislation will encourage more business owners to include environmental and social factors in their decision-making. I&rsquo;m hopeful that more entrepreneurs will be encouraged to create and sustain great companies where people want to work. Certainly there are lots of examples to follow among the <a class="text_01" title="100 Best Companies to Work For" href="http://www.greatplacetowork.com/best-companies/100-best-companies-to-work-for" target="_blank">100 Best</a> and <a class="text_01" title="Best Small &amp; Medium Companies" href="http://www.greatplacetowork.com/best-companies/best-small-a-medium-workplaces" target="_blank">Best Small and Medium Companies to Work For</a>.</p> <hr /> <p>&nbsp;If you&rsquo;d like further evidence on the financial benefits that come to great workplaces please look at the articles and research reports in the <a class="text_01" href="http://www.trustworthyleader.org/eng/Resources.html">Resources</a> section.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/14_The-Benefits-of-Being-a-B-Corp.html Shared Capitalism and Firm Performance <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Thursday, January 19, 2012<br /> <p>A recently released National Bureau of Economic Research Working Paper documents the powerful role that shared capitalism practices play in the overall positive financial performance of an organization. This research paper reports on analysis conducted by Doug Kruse and Joseph Blasi of Rutgers University and Richard Freeman of Harvard University, using a dataset from the 2005-2007 100 Best Companies to Work For applicant pool.</p> <p>The paper shares the results of an exacting, detailed analysis of the Best Companies applicant data provided by firms and employees, along with comparative data used by the authors to support their full examination of the links between pay, performance and workplace culture.&nbsp; For those of you interested in following the analysis please read the full working paper that is posted in the <a class="text_01" href="http://www.trustworthyleader.org/eng/Resources/Research_Reports/Shared_Capitalism_and_Firm_Performance.html">Resources</a> section of this site.</p> <p>The conclusion from this study is worth highlighting here: <em>The combination of group incentive pay with policies that empower employees and create a positive workplace culture reduces voluntary turnover and increases employee intent to stay and raises return on equity</em>.</p> <p>For all of us concerned with creating a healthy society, improving people&rsquo;s lives and affirming that sharing, kindness, cooperation and collaboration are essential to organization success, this study is a gold mine. It joins a long line of studies over the past years that affirm that workplace practices based in trust create more successful organizations on a number of measures &ndash; turnover, employee satisfaction and return on equity in particular.</p> <p>Hopefully this study&rsquo;s results will receive significant attention and I will certainly do my part to share the findings of this research. Yet as with the other studies in that &lsquo;long line&rsquo; I mention above, there is much more that needs to be done than simply share the results of this study.</p> <p>In a slight riff on the major conclusion of the study, I believe that it will be</p> <p style="padding-left: 30px;">1)&nbsp;&nbsp; the combination of rigorous research (such as the Kruse, Blasi, Freeman study),</p> <p style="padding-left: 30px;">2)&nbsp;&nbsp; documented examples of positive workplace cultures and organization success (through lists such as the 100 Best Companies),</p> <p style="padding-left: 30px;">3)&nbsp;&nbsp; entrepreneurs and organization leaders creating great workplaces</p> <p style="padding-left: 30px;">4)&nbsp;&nbsp; more focused storytelling to document the examples and creation process (in books such as The Trustworthy Leader and The Great Workplace) and</p> <p style="padding-left: 30px;">5)&nbsp;&nbsp; active coaching and consulting from skilled practitioners</p> <p>that will help us to achieve what is absolutely possible &ndash; an economic system that operates within a human system based in kindness, cooperation and collaboration, to promote a just and fair society.</p> <p>A lofty goal &ndash; yet it is possible as so many people are already showing us every day.</p> <p>&nbsp;</p> <hr /> <p><em>To find the paper on the National Bureau of Economic Research site please use this link: <a title="Blasi &amp; Kruse NBER paper" href="http://www.nber.org/papers/w17745" target="_blank">http://www.nber.org/papers/w17745</a></em></p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/13_Shared-Capitalism-and-Firm-Performance.html Say Thank You More Often <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Monday, January 2, 2012<br /> <p>Saying thank you to colleagues, staff members, associates, and people more distantly connected to us is an annual year-end ritual for many people in leadership positions.&nbsp; Speeches, memos, newsletter articles and blog posts are often filled with lists of peoples names and the events or actions for which they are receiving thanks. These gestures of appreciation are mostly nice and thoughtful yet they can be accepted with a bit of cynicism by recipients, especially if this is the only time during the year when &lsquo;thanks&rsquo; have been provided.</p> <p>Why say thank you? Well, we do it partly because we&rsquo;ve been taught from a young age that it is the right thing to do. We learn to say thank you to those who offer us help, who give things to us and who provide guidance or support. Yet doing this at a young age is mostly because we are told to, not because we truly understand the power of saying thank you.</p> <p>In the workplace there are many reasons why someone might say thank you. Sometimes words of appreciation are seen as political acts &ndash; which is what draws the most cynicism towards end-of-the-year missives. Political thank yous are those people perceive as given to cement an alliance, earn brownie points, or position the giver of thanks for some future benefit that he or she anticipates. &nbsp;The appreciation gets lost in the calculated reason behind the words.</p> <p>Other thank yous can be seen as pro-forma &ndash; a thank you that goes back to the childhood lesson of doing it because you are supposed to. When a child does this, it is understood that some of their thank yous may not come off as particularly sincere, yet this is because children are still learning, still trying to understand exactly what it does mean to say to someone &lsquo; I appreciate what you have done&rsquo;.&nbsp; From someone older, a pro-forma thank you does not carry much weight and is soon forgotten &ndash; or chalked up as just one of those things.</p> <p>As adults we have the opportunity to move beyond doing things because we are supposed to and to step away from thank yous that are political. The appreciation we share can be genuine and specific, sincerely conveying the positive emotional impact that someone&rsquo;s actions have had on our own life or on the lives of others.</p> <p>Trustworthy leaders are great providers of genuine and sincere expressions of thanks. When they say thank you, it benefits the recipient of the thanks yet also benefits themselves. It feels good to share a positive emotion with someone and a heartfelt thank you is definitely a positive emotion!</p> <p>Saying thank you for a specific act or contribution also helps people to know that their leader knows who they are, is aware of the work that they do and knows of the value that a specific act has brought to the organization &ndash; whether it was an act of customer service, extra effort to finish a project, service to a colleague needing help, or simply active participation during a brainstorming session.</p> <p>I recently came across a research article that affirmed the positive benefits that come from expressions of gratitude, and am providing the citation here for any of you who are curious. In <em><a class="text_01" href="http://www.trustworthyleader.org/eng/Resources/Interesting_Articles_Related_to_Being_Trustworthy/A_Little_Thanks_Goes_A_Long_Way.html">A Little Thanks Goes a Long Way</a>: Explaining Why Gratitude Expressions Motivate Prosocial Behavior</em> by Adam Grant and Francesca Gino[i] the authors provide interesting evidence to support the article title.</p> <p>A comment in the article that I found most relevant to one of the benefits of appreciation that I have seen for years is &ldquo;our research suggests that gratitude expressions may have important theoretical and practical implications for encouraging prosocial behaviors that promote cooperation&rdquo;. Basically, through a series of creative experiments, the authors confirmed that saying thank you contributes to people sense that they are valuable members of the group and to their willingness to make future contributions that are of benefit to the group. Trustworthy leaders know this, yet it is also nice to have outside confirmation.</p> <p>During the research for my book, and throughout the years that I&rsquo;ve worked with leaders who want to become more trustworthy, I have come across <a class="text_01" href="http://www.trustworthyleader.org/eng/Resources/Research_Reports/The_Power_of_Saying_Thank_You.html">wonderful examples</a> of the positive benefits that a leader&rsquo;s expression of genuine and sincere appreciation can have on others. Two stories from my book come to mind as perfect illustrations.</p> <p>The first is from Stew Leonard&rsquo;s, a regional grocery business in New England, and involved a promise made by CEO Stew Jr. to help a customer whose child needed a costume for school the next day.</p> <p style="padding-left: 30px;">&ldquo;Last night a customer called me at 9 p.m.. She has a kid who needed to go to school dressed as a chef the next day. The outfit they had ordered didn&rsquo;t arrive. I was in New York City at the time, but I told her that I would call the store and arrange for her to pick up an outfit. Well, I forgot to call the store. She came over to the store, though, and asked for the outfit at 10 p.m.. Everybody at the store got it together, got her the outfit, and even put a meat thermometer in her sleeve. I didn&rsquo;t even know it had happened. I called her this morning to apologize, and she said, &lsquo;No problem! John was fantastic last night.&rsquo;&rdquo;</p> <p style="padding-left: 30px;">As Stew told this story, he enthused about the performance of his staff, was humbled by their initiative and willingness to pitch in and get things done, and felt very honored to have had a part in creating the workplace culture in which this simple act could happen. Some leaders wouldn&rsquo;t tell this kind of a story&mdash;one in which they were asked to help, yet it was others who actually followed through. Some might fear it would show them in a poor light. Yet for Stew, this story exemplified the kind of leadership he wants to see at Stew Leonard&rsquo;s: everyone is able to pitch in, and praise for a good act goes to the people who actually provided the service. (p. 23)</p> <p>The second story comes from REI (Recreational Equipment Incorporated) and is contained within an employee&rsquo;s explanation of why he loves working at REI.</p> <p style="padding-left: 30px;">Some members of my team delivered excellent customer service to a father and his autistic son. Well, the father mentioned his experience on a blog. People at headquarters up to the CEO heard and read the blog. The CEO herself, Sally Jewell, sent me an email and a personal note to my employees thanking them. That level of recognition for the daily efforts of employees is unfounded in the retail environment. It shows the investment and understanding that the executives in the corporation have for the employees. At REI, people really do care. (p. 35)</p> <p>Both of these stories provide concrete examples of the power of saying thank you. In the case of Stew Leonard&rsquo;s, the employees involved received thanks from the customer and her child who got the chef&rsquo;s outfit and from Stew who showered them with praise when he found out what had occurred. The same thing happened at REI. The customer said thank you, told other people about what happened through a blog post, Sally Jewel heard about it, and added her genuine thanks to the mix.</p> <p>What lessons can we take from all of this?</p> <p style="padding-left: 30px;">1)&nbsp;&nbsp;&nbsp; Saying thank you sincerely is powerful.</p> <p style="padding-left: 30px;">2)&nbsp;&nbsp;&nbsp; Sharing thanks with the people who provided the service is critical to the appreciation being seen as genuine and to its having a positive impact.</p> <p style="padding-left: 30px;">3)&nbsp;&nbsp;&nbsp; Saying thank you can have absolutely no financial cost associated with it yet it can generate significant financial benefits for the organization in terms of reputation and employee satisfaction.</p> <p style="padding-left: 30px;">4)&nbsp;&nbsp;&nbsp; Saying thank you generates positive feelings.</p> <p>If there is one action you wish to take this year to strengthen your role as a trustworthy leader, try saying thank you more often. Do it with genuine care for those you are thanking, identify specifically the action or contribution you want to praise, and let the person you are thanking know about the broader impact of their actions. All of this will help you to understand deeply the power of saying thank you and will let those you thank know that you see them, know about their contributions and appreciate their efforts. Happy New Year!</p> <p>&nbsp;</p> <hr /> <p>[i] Journal of Personality and Social Psychology, 2010, Vol. 98, No. 6, 946-955</p> <p>&nbsp;</p> <p>&nbsp;</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/12_Say-Thank-You-More-Often.html Strong Coffee – Howard Schultz named Fortune’s 2011 Businessperson of the Year <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Monday, December 5, 2011<br /> <p>It appears that Howard Schultz seeks to live a good life. In this week&rsquo;s issue of Fortune magazine (Dec. 12, 2011) an <a class="text_01" title="Business person of the year 2011" href="http://management.fortune.cnn.com/2011/11/17/starbucks-howard-schultz-business-person-year/?iid=F_F500M" target="_blank">article</a> celebrates Schultz being named Fortune magazine&rsquo;s 2011 businessperson of the year by telling his business success story. Many anecdotes from his personal life and community activities are included, and provide a rich description of who he is as a person. His consistency of effort to be a good person, amid all the distractions that come with wealth, corporate success and public recognition strikes me as a clear example of his virtuous circle at work.</p> <p>Schultz is the current Chairman and CEO of <a class="text_01" title="Starbucks" href="http://www.starbucks.com/" target="_blank">Starbucks</a>, the ubiquitous coffee company that provides fuel for many morning meetings - and afternoon conversations, informal gatherings, quick lunches and after work shots of adrenaline.</p> <p>In general most people are now comfortable with Starbucks though for a while that wasn&rsquo;t the case. It was said to have grown too fast, gobbled up small coffee shops, and homogenized the landscape &ndash; all things good people in local communities worried about. Yet Starbucks also provided good jobs, exceptional benefits, shared profits with partners, supported community organizations and in quiet ways seemed to be changing people&rsquo;s ideas about what a successful stable growing business could and should do to be a good community member.</p> <p>A focus on the well being of people is ever present in the activities that occur at Starbucks &ndash; a legacy, I believe, of some early experiences in Schultz&rsquo;s life, events that he had to observe and move thorough yet couldn&rsquo;t control. His father&rsquo;s exhausting work life - a series of low paid blue-collar jobs with no benefits and no health insurance - has been transformed in the working conditions provided for front-line people at Starbucks. It is not perfect for everyone yet is definitely a <a class="text_01" title="Starbucks Best Companies recognition" href="http://www.greatplacetowork.com/best-companies/search-best-companies" target="_blank">great place to work</a> for most.</p> <p>It is not just the fact that hourly workers at Starbucks are paid reasonable wages relative to their peers, provided benefits (including health insurance for people working 20 hours per week or more) and given the resources they need to do their work that makes Schultz an exceptional business leader. What makes him exceptional is the care and concern for others that guides the choices he makes in his life AND the fact that he does not shut this care and concern off when he makes decisions related to the business.</p> <p>Schultz stepped away from the CEO position in 2000, and stepped back in during 2008 as he saw the company drifting away from its core values and mission. Some institutional investors advised him to scrap the health insurance plans for part-time employees, and he said no. Others have challenged the corporate support for community involvement that is integrated into the activities of every Starbucks store, yet that continues.</p> <p>Schultz has expanded his own community activism, using the bully pulpit of his CEO position to <a class="text_01" title="Boycott campaign donations" href="http://www.nytimes.com/2011/08/13/opinion/nocera-boycott-campaign-donations.html" target="_blank">speak out</a> about the political gridlock facing the country &ndash; and challenge other CEOs to speak out as well. He&rsquo;s offering support for job creation and providing every customer the opportunity to help by making a small donation to the &ldquo;<a class="text_01" title="Create Jobs website" href="http://www.createjobsforusa.org/" target="_blank">Create Jobs for USA</a>&rdquo; program he started. He&rsquo;s giving people a way to participate in making improvements that we all know are needed in our society.</p> <p>Schultz is quoted in the Fortune article as saying that after he came back to the CEO position in 2008 that he needed to transform the business as well as himself. While his professional success has always included an awareness and concern for others, he now seems to be moving through his life with greater strength and determination to speak out about the values and ethics that all business leaders can use to guide their companies.</p> <p>Why does he do this? I&rsquo;m not 100% sure as I haven&rsquo;t had the opportunity to ask him directly. Yet it appears that he wants to lead a good life, to be an honorable leader, give back to those who have given to him and share the benefits of what he has been able to help generate. This is what <a class="text_01">trustworthy leaders</a> do as they develop and live according to their <a class="text_01" href="http://www.trustworthyleader.org/eng/The_Trustworthy_Leader_Book/The_Virtuous_Circle_of_Trustworthy_Leadership.html">virtuous circle</a>.</p> <p>And it works &ndash; for the business, for one&rsquo;s own life and for the community that feels the positive impact. Howard Schultz is a great choice for businessperson of the year and let us all hope that his positive example inspires many more business leaders to think more about what they can give to others than take for themselves.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/11_Strong-Coffee-Howard-Schultz-named-Fortune-s-2011-Businessperson-of-the-Year.html No Manipulation Here – Trustworthy Leaders and Information Sharing <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Tuesday, November 29, 2011<br /> <p>During a recent discussion with two colleagues about the topics covered in my book <a href="http://www.trustworthyleader.org/eng/The_Trustworthy_Leader_-_book_info_here.html"><span class="text_01"><em>The Trustworthy Leader</em></span></a>, the question of manipulation came up. Over the years some people have charged that progressive management practices can be manipulative in that their goal is often to get people to work toward a goal that they might not initially intend to. Thus, the argument goes, the practices that cause this work must be manipulative for they are causing people to aim for a goal they are not consciously choosing.</p> <p>Manipulation has negative connotations as it brings to mind the use of deceptive practices to bring an undisclosed benefit to the manipulator based on the actions of the one being manipulated.&nbsp; Even if the encouraged practices themselves are benevolent and the outcome for the participants is positive &ndash; people are healthier, safer or smarter &ndash; manipulation can be involved if the hoped for outcome is not shared with people ahead of time.</p> <p>To avoid manipulation great leaders seek to practice full disclosure &ndash; to let people know what they are asking for and why. When Trustworthy Leaders share information with others, there are three overarching aspects of the information sharing practices they use that help them to avoid even the hint of manipulation.</p> <p>First, they share information so that those on the receiving end can understand the information. This occurs before any action takes place &ndash; it is context setting. Some information sharing for understanding actually has no &lsquo;action&rsquo; goal associated with it &ndash; it&rsquo;s simply undertaken to ensure that people are aware of events in the organization that might at some point have an impact on their work or the larger work of the organization.</p> <p>Second, Trustworthy Leaders share information in such a way that others can participate - either in the information sharing process itself or in the life of the organization. This aspect of information sharing does bring with it the possibility for action. Information is shared with people specifically so that when they do participate &ndash; in a discussion, as a member of a project team, when serving a customer - they can do so effectively.</p> <p>Finally Trustworthy Leaders share information with people so they can have influence. At this stage people are not only expected to act, but because of their actions they are expected to change the nature of what comes next &ndash; they will have influence.</p> <p>If you want to be seen as a Trustworthy Leader, sharing information in ways that support understanding, promote participation and extend influence will bring with it multiple benefits. You will enhance people&rsquo;s engagement to the organization and their work; you will enhance your status as a trusted source of useful information; and you will create a positive, constructive environment for everyone &ndash; yourself included. And, all of these benefits can be fully disclosed ahead of time!</p> <p><em>For an interesting and concise discussion of the characteristics of manipulation see &lsquo;Is Motivation Management Manipulative?&rsquo; By Raymond S. Pfeiffer in Moral Rights in the Workplace, Gertrude Ezorsky, Ed. &copy;1987 State University of New York Press</em></p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/10_No-Manipulation-Here-Trustworthy-Leaders-and-Information-Sharing.html Conscious Capitalism – How to get it right <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Saturday, November 12, 2011<br /> <p>The Spring 2011 issue of <a class="text_01" title="Conscious Capitalism" href="http://www.jstor.org/stable/10.1525/cmr.2011.53.issue-3" target="_blank">California Management Review</a> (Vol. 53, #3) presents a series of articles on the topic of conscious capitalism.</p> <p>The ones I really like are from the practitioners &ndash; John Mackey, co-founder and co-CEO of Whole Foods Markets, and Doug Rauch, former President of Trader Joe&rsquo;s.&nbsp; Mackey does some defending in his essay &ndash; in part because he wants to clarify what he sees as a notable flaw in the main article &ndash; confusion between the concepts of corporate social responsibility and <a class="text_01" title="Conscious Capitalism website" href="http://www.consciouscapitalism.org/" target="_blank">Conscious Capitalism&reg;</a> as practiced at Whole Foods Market. &nbsp;Yet he also promotes what he sees as the very positive benefits that come to practitioners of conscious capitalism in general &ndash; namely successful business operations.</p> <p>There are no false promises that conscious capitalism will save the world, yet Mackey does make the point that commitments to higher purpose, stakeholder interdependence and conscious leadership create a culture in which value creation for all major stakeholders will be higher than in a business operating under a different philosophy. This is what he has found at Whole Foods, a 30-year old 10 billion dollar company with over 60,000 team members who work there.</p> <p>Trader Joe's former president Doug Rauch provides a second practitioner written piece that is refreshing for its clarity of thought, language and perspective. Rauch offers practical examples of ways in which the principles of conscious capitalism have been implemented at Trader Joes, and of the success that has accrued to the company&rsquo;s stakeholders as a result. His &lsquo;feet on the ground&rsquo; stories should prove useful and inspiring for leaders seeking guidance as they face the daily challenges of organization life.&nbsp; &nbsp;</p> <p>Both Mackey and Rauch are clear that a leader&rsquo;s commitment to follow the principles of conscious capitalism him or herself is key to its beneficial application inside the organization. Mackey states that, &ldquo;It doesn&rsquo;t matter if an organization has a higher purpose if the leadership doesn&rsquo;t understand and seek to serve that purpose&hellip; It is especially important that the CEO and other senior leadership embody the higher purpose of the organization rather than seek to maximize their own personal power and compensation.&rdquo; Practical evidence of Mackey&rsquo;s own commitment to his comments comes in one example of a practice in place at Whole Foods. Whole Foods uses a wage cap system that limits the maximum annual cash compensation (wages plus bonuses) of any Team Member, including executives, to 19 times the average of all full-time Team Members who work there during the year. &nbsp;</p> <p>Rauch provides his own examples of the ways in which he displayed a commitment to conscious capitalism as president of Trader Joes. His strongest points focus on the importance of forward thinking leadership saying that a leader who tries to &lsquo;manage the business by the bottom line [is] driving by the rearview mirror&rsquo;.&nbsp; A forward thinking leadership approach that recognizes the interdependence of all stakeholders leads to a focus on &lsquo;and&rsquo; rather than &lsquo;either/or&rsquo;.&nbsp; Maximizing the benefits to all parties avoids the simplicity of a trade off mentality that too often has allowed the more powerful to win all the trades.</p> <p style="text-align: left;">Whole Foods and Trader Joes are two of the many organizations known to be great workplaces, great community members, and financially successful business ventures. They are both active practitioners of conscious capitalism. Are they perfect?&nbsp; Absolutely not, and neither leader claims that the practice of conscious capitalism has made their organization untouchable. What they do claim though, and what other business leaders would be wise to pay attention to, is that the practice of conscious capitalism has contributed mightily to their organizational success.</p> <p style="text-align: left;" align="center">Rajendra Sisodia, professor of Marketing at Bentley College sums up the thinking behind the success that many businesses have found by following the principles of conscious capitalism.&nbsp; Conscious capitalists, he says, are aware of the consequences of their actions and they take ownership of those consequences. They spend money where they believe it will make a positive difference &ndash; perhaps by raising the wages of hourly workers rather than building an executive dining room. They connect people with a higher purpose, engaging customers as well as workers in the success of the organization. They are positive beacons within their communities of healthy economic activity. This kind of capitalism that operates with a commitment to promote well-being for all is the way forward.</p> <p style="text-align: left;" align="center">Update: Kip Tindell, CEO of The Container Store, talks about how he practices <a class="text_01" title="Tndell speech on Conscious Capitalism" href="http://www.utdallas.edu/news/2011/12/15-14731_Container-Store-CEO-Pitches-Conscious-Capitalism_article.html" target="_blank">conscious capitalism</a>.</p> <p style="text-align: left;" align="center">Amy Lyman is a co-founder of Great Place to Work&reg; Institute and author of The Trustworthy Leader</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/9_Conscious-Capitalism-How-to-get-it-right.html Leading with Honor and Integrity <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Saturday, November 12, 2011<br /> <p>Leading with Honor and Integrity</p> <p>Many people speak of the importance of integrity, myself included, and yet when we talk about it we often assume that what we are showing integrity towards is a good thing. In preparation for conference presentations in the US and Canada I came across a very interesting article that challenged me to rethink how I talk about the importance of integrity.</p> <p>In the Fall 2009 issue of Rotman magazine (produced by the Rotman School of Management at the University of Toronto) an <a class="text_01" title="Jensen Interview" href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1511274" target="_blank">interview</a> with Michael Jensen covers the topic of integrity, as well as morality and ethics. &nbsp;Jensen, an emeritus professor at Harvard, has written quite a bit lately about the importance of integrity.</p> <p>In his writings he challenges all of us to remember that integrity by itself is value neutral, the term coming from the same root as integer, meaning whole or complete. So when we think about a person of integrity, and use that as a positive description, what often remains hidden is the fact that what we find so positive about that person of integrity is the fact that she lives by a set of values and principles that we admire. It is her integrity towards her values that is positive, not necessarily the fact that she practices integrity by honoring her word and delivering on her promises. Surely if the values she lived by were ones we found offensive &ndash; elitist, greedy, arrogant and abusive in her treatment of people with less power than her &ndash; would we admire her integrity towards those values?</p> <p>Jensen&rsquo;s interview provided me with an insight about the importance of always remembering the first part that should go with any comment about someone&rsquo;s integrity. For the trustworthy leaders whom I admire, their integrity is a positive quality because of the honor with which they assume their leadership responsibilities. A trustworthy leader&rsquo;s actions that convey the honor of his position, the honor with which he treats people and the honor that he feels as a leader are what matter. When a trustworthy leader acts with humility, is respectful of others and uses the power of his position and his personal power to the benefit of others, then he is honorable. And his integrity to those qualities is admirable.</p> <p>Great trustworthy leaders are great because they seek to build trust-based relationships with the people with whom they work. Much of their success as leaders is due to the incredible amounts of discretionary effort they elicit from their colleagues, co-workers, and far-flung employees &ndash; all of whom feel a strong connection to the positive experience of working with a leader of honor and integrity.</p> <p>As you consider your own leadership style, and the successes and challenges you&rsquo;ve faced, please remember to look also at what it is that you show integrity towards &ndash; what actions match your words, and what promises you deliver on. If your words and promises are credible, respectful and fair, then you will surely be heading in the right direction to be seen as trustworthy.</p> <p>Amy Lyman, PhD</p> <p>Co-founder of the Great Place to Work&reg; Institute and author of The Trustworthy Leader</p> <p>&nbsp;</p> <p>&nbsp;</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/8_Leading-with-Honor-and-Integrity.html Old Fashioned vs Enduring <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Thursday, November 10, 2011<br /> <p>I recently finished reading <em>SPARK &ndash; Lessons from Lincoln Electric&rsquo;s Unique Guaranteed Employment Program</em> by Frank Koller. It is an absorbing account of Lincoln Electric, a Cleveland Ohio based manufacturing business. Founded in 1895, Lincoln Electric is the world&rsquo;s largest manufacturer of electric arc-welding equipment. I visited there during the summer of 1991, when I was helping to conduct focus group interviews for companies being considered for the 1993 edition of <em>The 100 Best Companies to Work For in America</em> book. I remember being struck during the interviews with how confident, centered and focused the employees were.</p> <p>Lincoln made the list of Best Companies in 1993 and from everything I&rsquo;ve heard and read since I&rsquo;d say they still have a great workplace. Since 1934 they have consistently paid out a large profit sharing bonus to all employees just before the end of the year. For most years the bonus has been close to 60% of an employee&rsquo;s base earnings, reaching over 100% during especially good times.</p> <p>Their sustained record of significant profit sharing is testimony to a number of key practices that fuel Lincoln&rsquo;s long-term success. First is their guaranteed employment program, which is the focus of much of Koller&rsquo;s analysis. With few changes over the years, Lincoln has consistently provided people with guaranteed employment as long as they meet the exacting quality and performance standards set by the company. People know what is expected of them in terms of hard work and quality output and if they meet the standards, they are guaranteed a job.</p> <p>While some people have challenged the legitimacy of the &lsquo;guarantee&rsquo;, and Koller does discuss those challenges, folks at Lincoln claim proudly that they have never had a layoff in the United States in the company&rsquo;s history.</p> <p>This is no idle commitment as there have been times when the company has gone to great lengths to keep people employed during economic downturns. Welders may be reassigned to paint the facilities, repair the roof or maintain the grounds when things are slow, yet they are working.</p> <p>Another key practice in use is the Advisory Council comprised of workers elected by their peers who meet with Lincoln&rsquo;s president to discuss issues of concern to everyone in the company. During the early 1900s many companies established joint management-employee groups yet very few have maintained and used them as consistently as Lincoln Electric. Meetings have been held every two to four weeks since 1914!</p> <p>Topics discussed and resolved at these meetings lead to the provision of a number of ground breaking programs for workers including &lsquo;group life insurance (1915), an employees association (1919), paid vacations (1923), employee stock ownership (1925), a suggestion system with cash payouts (1929), annual cash bonus (1934) annuities for retired employees (1936), the merit rating system (1947), and guaranteed continuous employment (1958)&rsquo;(p.36). The Advisory Council has also scuttled changes proposed by management when they felt those changes were inconsistent with the culture and values of the company.</p> <p>A commitment to clear, open, honest and direct communication influences all of the employee-management interactions that happen at Lincoln. This commitment shows up in the Advisory Council meetings and in the company&rsquo;s open-door policy. Advisory Council discussions are lively as elected representatives speak on behalf of all the employees in their work area. But communication with senior leaders is not limited to just the elected representatives. Any employee can ask to speak with the president or chairman of the company at any time.&nbsp;</p> <p>These practices and benefits combine to create the unique culture of Lincoln Electric yet it is the foundation they rest on that ties them all together and makes the company so successful. People are committed to work with each other based on a set of human values that guide how they treat each other.</p> <p>These values are cited on the book cover as old-fashioned yet I think that&rsquo;s a misstatement. The values that guide Lincoln Electric are the same ones that guide Zappos, NetApp, R.W. Baird and many other great companies, young or old, new industry or traditional manufacturing. They are enduring values, not old-fashioned ones. They are values that collectively say &lsquo;let&rsquo;s be respectful of every human being who works in this organization&rsquo;. These are values that great humanistic and spiritual leaders have talked about for thousands of years, and that people will hopefully continue to talk about for thousands of years to come. These are values that people seek to live by, regardless their role.</p> <p>I have always believed that people want to be known by others, and contribute to something positive. Most people enjoy learning and being part of an effort that is larger than what they could take on by themselves. People want to enjoy time with family and friends and create a place that is better for those who will come after them.&nbsp; Greed and insecurity can distract some, leading them to try and exclude one group, include another, and take as much as they can for themselves. Yet those actions are not based on values that endure but on values that harm.</p> <p>When people are able to decide collectively, in an open environment, how they want to organize themselves and work together, practices based in respect usually rise to the top. What Lincoln is doing in their organization is the same as what is happening in many recently formed companies &ndash; how they do it is distinct, yet the values they are using are the same.</p> <p>Koller&rsquo;s book is well written and definitely worth reading. The story of Lincoln Electric and the enduring values used to guide company operations is inspiring. And they&rsquo;ve achieved tremendous success as an organization &ndash; financially, in terms of market share, and most importantly in terms of their reputation as a respectful group of people. I think there&rsquo;s something all of us can learn from this arc-welding company in Cleveland Ohio.</p> <p><em>An update (thanks to Frank Koller) - here's a <strong><a class="text_01" title="Cleveland Manufacturer Welds Together Job Security" href="http://www.pbs.org/newshour/bb/business/july-dec11/makingsense_07-13.html" target="_blank">link</a></strong> to a segment aired on PBS Newshour July 13, 2011. It's a nine minute segment on the long term success of Lincoln Electric.</em></p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/7_Old-Fashioned-vs-Enduring.html Time Off for Babies: Why it matters <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Friday, November 4, 2011<br /> <p>A report released by Human Rights Watch on Feb 23, 2011 titled <a class="text_01" title="Human Rights Watch" href="http://www.hrw.org/reports/2011/02/23/failing-its-families-0" target="_blank">Failing Its Families</a> offers a critique of the historical and current support provided in the United States for family-leave programs. The US is cited as one of just three countries worldwide offering no legal guarantee of paid maternity leave for working families. &nbsp;The question of a legal guarantee for paid paternity leave, or paid guardian leave was not raised in the report. The 1993 Family Medical Leave Act does provide for up to 12 weeks of job protected unpaid leave for men and women, yet covers only about half of the workforce.&nbsp;</p> <p>There is of course also no guaranteed support provided for non-working families in the US, unless the mother is living at such a level of poverty that she and her baby qualify for a government aid program. Yet in these cases poverty is the reason the aid is provided &ndash; it is not in general provided as recognition of the fact that a new member has joined society and we all want to make sure that she/he gets off to a good start.</p> <p>Why should this be of concern to us? Well speaking for myself, whether the babies being born are mine or someone else&rsquo;s, and whether I myself have children or not, by choice or otherwise, these new babies are joining the society in which I live. Their ability to be healthy, happy and enjoyable friends, neighbors, teachers, police officers, construction workers, nurses or leaders will be significantly affected by the quality of life they experience during the first two years of their existence.</p> <p>And the ability of their parents/caregivers to be happy, healthy and productive as both parents/caregivers and workers is significantly affected by the support they receive during the first two years after the birth or adoption of a baby. If we want a vibrant economy, to improve people&rsquo;s health, reduce poverty, and insure that future workers are well prepared to learn and contribute, it seems to me only reasonable that we would all be looking for ways to insure that newborns and their caregivers are well cared for themselves.</p> <p>How does all of this relate to great workplaces? Good question. It turns out that leaders among the 100 Best Companies in the United States understand the importance of insuring that parents and new family members get off to a good start. Every 100 Best Company insures that some form of paid maternity leave is available to employees &ndash; at a minimum through the company&rsquo;s short-term disability program. While many of us bristle at the idea that pregnancy and birth are disabilities, in some states and for the US as a whole disability insurance programs are the most common ways in which people secure some type of support during the birth or adoption of a child.</p> <p>And the Best Companies don&rsquo;t stop there. Seventy-three of the 100 Best offer support for fertility treatments through their health insurance programs.&nbsp; Ninety-two offer lactation rooms to encourage breast-feeding, one of the greatest natural sources of health care protection available to any newborn. On-site childcare, off site subsidized childcare and back up childcare are offered by about 1/3 of the companies, and resource and referral networks are available to answer questions and provide information on resources available outside of the company. Forty-four of the 100 Best explicitly offer paternity leave programs that go beyond paid time off available to any employee. Most of these programs are also available to domestic partners, same-sex or opposite sex, and extensive benefits are available for people who adopt babies or older children. And this list of support resources doesn&rsquo;t include the multitude of special offerings that include things such as meals sent home, gifts for the newborns, monthly wellness seminars, lactation consultants, and flexible scheduling options.</p> <p>Why do the Best Companies provide all of this support? They care about their employees as people first, and recognize the significance of adding a new baby or child to a family. They want employees to be happy, healthy and loyal so go to great lengths to insure that people feel supported while away from the workplace. They also want people to know how important they are to the success of the company so that they will return. Best Companies do experience lower turnover than their peers in the same industry and over time have consistently shown themselves to be better financial performers. Perhaps there&rsquo;s a correlation here?</p> <p>All is not lost outside of the Best Companies, with a number of bright spots appearing in the US with respect to state government support for parental leave. California has an excellent Paid Family Leave (PFL) program that is structured as an insurance benefit, like SDI, and is funded by a 1.2% tax on payroll. This program was established in 2002, fully funded and effective in 2004, and despite significant criticism that the law would harm small businesses because of the tax burden, the vast majority of employers report minimal negative impact on their business operations. In fact, the responses have been notably positive:&nbsp; Most employers report that PFL had either a &ldquo;positive effect&rdquo; or &ldquo;no noticeable effect&rdquo; on productivity (89 percent), profitability/performance (91 percent), turnover (96 percent), and employee morale (99 percent)*. And ninety one percent of respondents in a recent survey about the program indicated that they were not aware of any instances in which employees abused the program.</p> <p>In 2009, New Jersey implemented a Family Leave Insurance program modeled after the one in California, using the state&rsquo;s temporary disability insurance (TDI) program as a support platform. A few other states have TDI programs and Washington State passed a family leave law in 2007 without the support of TDI. All of these programs seek to provide some level of wage replacement for parents (birth mothers, fathers, partners, adoptive parents) so that they can take care of the newborn or adopted child, and take care of themselves as well during this critical time.</p> <p>Around the world one of the best examples of a gender neutral parental leave policy can be found in Sweden. Initially paid parental leave was provided to couples to allocate between the parents as they wished, yet forward-thinking Swedish leaders, wanting to encourage more men to bond with and be involved in the care of their newborns, added a number of &lsquo;use it or lose it&rsquo; days to the leave program. These days are made available to the family only if they are used by the father. After this legislation was passed the number of days father&rsquo;s took to bond with and care for their children increased dramatically.</p> <p>Parental leave is clearly not a policy that everyone needs to take advantage of, yet we will all take &lsquo;advantage&rsquo; of the little ones who join our society as they grow up, consume resources, create, contribute and give back to the next group of babies that comes along.&nbsp; We really do need to think of the long term when considering our support for parental leave programs, wherever we live. Everyone benefits when babies are given the best chance to grow up happy, healthy and well cared for.</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/6_Time-Off-for-Babies-Why-it-matters.html Further Confirmation: Trust is important <table cellspacing="0" cellpadding="0"> <tr> <td style=" font: normal 11px Verdana, Arial, Helvetica, sans-serif"> Monday, October 10, 2011<br /> <p>Every year I look forward to reading the results of the Edelman Trust Barometer, a survey of &lsquo;informed publics&rsquo; that asks people to respond to a series of questions about their trust in institutions. The &lsquo;informed publics&rsquo; group is a select population of college educated, high-income individuals who regularly use online media and read business publications. It&rsquo;s a skewed sample of the general population from 23 countries and five continents. Yet despite these limitations the Edelman survey is well administered, consistently implemented over time, receives a tremendous amount of media attention, and serves as a good platform for considering the value of trust in institutions.</p> <p>This year in particular the reports from Edelman have focused on the importance of trust in business activities &ndash; trust inside companies between employees and management, and trust outside of companies between consumers and companies. Unfortunately there&rsquo;s not much that&rsquo;s new in terms of what&rsquo;s being said about the importance of trust, only concern expressed with the low numbers of people who perceive that businesses are trustworthy. Responses from the US and UK are similar with about 45% of people from both countries indicating that they trust that business will do what&rsquo;s right.</p> <p>More specific results from the Edelman survey confirm that people believe that transparent and honest business practices (65%), and how well employees are treated (63%) are important to corporate reputations. More people have positive perceptions of technology companies and, not surprisingly, fewer hold positive perceptions of financial institutions. Further information on the Edelman report can be found here &nbsp;(<a class="text_01" title="2011 Trust Barometer" href="http://www.edelman.com/trust/2011/" target="_blank">http://www.edelman.com/trust/2011/</a>)</p> <p>Edelman&rsquo;s results are in stark contrast to the results from employees at the Best Companies in both the US and the UK. In the US, eighty-four percent of the employees from the companies on the 2011 100 Best list indicate a high level of overall trust in management, while ninety percent indicate that often or almost always they believe that management is honest and ethical in its business practices. In the UK, the numbers are similar with seventy-nine percent of the employees from the 2010 Best Workplaces list indicating high levels of trust in management and eighty-seven percent indicating their belief that management is honest and ethical in their business practices.</p> <p>The contribution of high levels of trust to corporate reputations and performance is old news for people who work and invest in Best Companies. In the United States, the publicly traded 100 Best Companies have consistently, over time, outperformed the S&amp;P 500 stock index and the Russell 3000. (<a class="text_01" title="Financial Performance" href="http://www.greatplacetowork.com/what_we_believe/graphs.php" target="_blank">http://www.greatplacetowork.com/what_we_believe/graphs.php</a>)</p> <p>This kind of long term sustained performance receives a great deal of attention from some investors, yet financial analysts do not always know how to fully value the intangible assets created by high levels of trust. Dr. Alex Edmans, a professor at Wharton&rsquo;s Business School has written an excellent analysis of this dilemma. (<a class="text_01" title="Edman's paper" href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=985735" target="_blank">http://papers.ssrn.com/sol3/papers.cfm?abstract_id=985735</a>)</p> <p>For those of you who aren&rsquo;t interested in the debate and simply want to move in the right direction to build trust within your own organizations there are many resources available for you on the Institute&rsquo;s website - <a class="text_01" title="Institute website" href="http://www.greatplacetowork.com/news/articles.php" target="_blank">http://www.greatplacetowork.com/news/articles.php</a> and here as well <a class="text_01" title="UK Institute website" href="http://www.greatplacetowork.co.uk/education/articles.php" target="_blank">http://www.greatplacetowork.co.uk/education/articles.php</a></p> <p>Creating trust in your own organization will bring significant benefits in terms of corporate reputation and performance &ndash; it&rsquo;s time to get started.</p> <p>&nbsp;</p> <p>Amy Lyman, PhD</p> <p>Co-founder of the Great Place to Work&reg; Institute and author of The Trustworthy Leader</p> </td> </tr> </table> http://www.trustworthyleader.org/eng/Blog/5_Further-Confirmation-Trust-is-important.html