Blog: Imagine

A CEO letter to the Board...long overdue

29 July 2017

Dear Members of the Board

I am writing to you with a proposal that may seem radical, but is in fact conservative. That is because my primary concern as Chief Executive Officer is to conserve this company as a healthy enterprise. You are now paying me so much that I can no longer manage this company as I should. I hereby request that you cut my salary in half and eliminate my bonuses.

We have talked a great deal about teamwork in our enterprise, that our people are all in this together. So why am I singled out by virtue of my compensation? Bonuses are the worst part of it. Like everyone else in this company, I am being paid to do my job. Why should I be paid extra to do a good job? If I believe in this company, I buy the stock. If I don’t, I quit. The misguided assumption behind these bonuses is that I, as CEO, do it all.

Dear Members of the Board

I am writing to you with a proposal that may seem radical, but is in fact conservative. That is because my primary concern as Chief Executive Officer is to conserve this company as a healthy enterprise. You are now paying me so much that I can no longer manage this company as I should. I hereby request that you cut my salary in half and eliminate my bonuses.

We have talked a great deal about teamwork in our enterprise, that our people are all in this together. So why am I singled out by virtue of my compensation? Bonuses are the worst part of it. Like everyone else in this company, I am being paid to do my job. Why should I be paid extra to do a good job? If I believe in this company, I buy the stock. If I don’t, I quit. The misguided assumption behind these bonuses is that I, as CEO, do it all.

Now I am getting hate mail from our employees about my pay. This is certainly disconcerting, but more troublesome is that I have no reasonable reply, short of claiming that I must be several hundred times more important than they are. Is this leadership? Is it any way to run a company?

We have had a good deal of discussion at our board meetings about the long-term health of this company. Why then am I being rewarded for short-term gains in the stock price? You all know perfectly well that I can use all kinds of tricks to drive up that price, and so reach my bonuses, while destroying real value—and helping to do a number on our economy too.

Ever since we started this Shareholder Value nonsense, our values have gone to hell. The frontline employees tell me that this gets in the way of serving customers: they are forced to see dollar signs out there, not people. Consequently, many of them don’t give a damn any more. As one put it to me recently: “With all this counting, we don’t count. So why should we care?”

I have always prided myself on being a risk taker; that is one reason you put me in this job. So how come I cash in big when the stock price goes up but pay nothing back when it goes down? Some risk taker! You know what: I’m tired of being a hypocrite.

I know the excuse we have been using all along: that I am just being compensated to keep up with CEOs in other companies. This makes me a follower, not a leader.  Enough of this complicity in behavior that we all know to be shameful. My salary should not be some kind of external trophy, but an internal signal about the culture we are trying to build.

So please, help me to concentrate on managing this company as it should be managed.

Sincerely,

Your CEO

© Henry Mintzberg 2017.

An early version of this commentary was published in the Financial Times, as “There's no compensation for hypocrisy" (29 October 1999), and it first appeared on this blog on 24 October 2014. I post it here now, with revisions, in the hope that some responsible CEO somewhere will finally listen.

Follow this TWOG on Twitter @mintzberg141, or receive the blogs directly in your inbox by subscribing here. To help disseminate these blogs, we also have a Facebook page and a LinkedIn page.

Imagine getting it…beyond Donald Trump

9 March 2017

Imagine Donald Trump getting it. Imagine him coming to realize what he must do to serve, not the interests of business, but of the people who elected him to put a stop to their exclusion.

After all, Ariel Sharon was a tough guy who overcame his smugness to change course, for the sake of his country. Donald Trump has certainly shown the proclivity to change course—sometimes daily! And who can doubt his penchant to challenge his “enemies”, whoever they might happen to be? Barack Obama had trouble dealing with real opponents, and too many people doubted Hillary Clinton’s propensity to confront the establishment.

Imagine Donald Trump getting it. Imagine him coming to realize what he must do to serve, not the interests of business, but of the people who elected him to put a stop to their exclusion.

After all, Ariel Sharon was a tough guy who overcame his smugness to change course, for the sake of his country. Donald Trump has certainly shown the proclivity to change course—sometimes daily! And who can doubt his penchant to challenge his “enemies”, whoever they might happen to be? Barack Obama had trouble dealing with real opponents, and too many people doubted Hillary Clinton’s propensity to confront the establishment.

At his recent congressional address, Donald Trump did show a hint of a shift: he stayed on script, and read it with some feeling. Millions of Americans breathed a collective sigh of relief: finally something, anything. Next day, though, it was back to the old shtick.

So let’s try this instead. Imagine if those “enemies of the people”, the liberal press, get it instead, to help all the friends of a free press—doubtless a majority of the people—get it too. I subscribe to one of these newspapers up here in Canada, the New York Times, which should be called The Relentless Rant: article after article, comment after comment, day after day, on the foibles of Donald Trump. It’s become entertainment more than news: look at what this guy did to us yesterday.

OK, I get that. But does this newspaper get it? The New York Times will no more hound Donald Trump out of office than Donald Trump will hound The New York Times out of business. The problem goes far deeper than him.

I look for commentaries in the paper that get into this depth—go beyond those foibles, to the root of what is distressing so many Americans. Instead, here is what I got in the opinion piece on page 1 of the Times the day after that congressional address. Roger Cohen imagined a dinner of Nigel Farage with Donald Trump: “I suppose they disparage Muslims over well-done burgers and Coke. Multilateralism gets a guffaw with ice cream. God help us.” God help Roger Cohen. Here we have a bit of that fake news, its effete snobbery as base as Donald Trump’s ignorant rants. Indeed, this points the way to the problem: the callous exclusion of people who eat hamburgers and drink Coke.

OK, so if it’s not yet time for the Times to get it, how about the people themselves—the well-intentioned, good folks of America who are fed up with what’s been going on, including some who trustingly voted for this man. Imagine them as the silver lining in the dark cloud of Donald Trump.

To appreciate this, think of Donald Trump as one hell of a community organizer, superior even to Barack Obama (at least after his first election). The president has already been doing his country a great service by bringing all those people on to the streets, and thus bringing to a head the fundamental issue. He’s just the extreme manifestation of the problem that has been festering in the country for years. Yet it is surprising how many of even the most thoughtful people don’t get it. The dogma runs deep.

What the Donald Trump presidency makes clear is that the United States of America is not suffering from too much government so much as from too much business, all over government. The country is seriously out of balance.

I intend to elaborate on this in a forthcoming blog of its own. So please stay tuned. Meanwhile, you can get it by reading my little book Rebalancing Society…radical renewal beyond let, right, and center.

© Henry Mintzberg 2017. 

Follow this TWOG on Twitter @mintzberg141, or receive the blogs directly in your inbox by subscribing hereTo help disseminate these blogs, we also have a Facebook page and a LinkedIn page.

Marching to Clever Campaigns

26 January 2017

Missing from the marches on Saturday was Saul Alinsky, the legendary organizer of decades ago who, beyond marching, conceived clever campaigns to drive social change in the U.S.—by driving established authorities crazy.

Here is a simple example, in the spirit of Alinsky: In the late 1960s, in San Antonio, Texas, people who were fed up with their utility company overpaid their bill by 1¢. That simple cent, multiplied many times over, tied the bureaucracy in knots. It gave in.

Missing from the marches on Saturday was Saul Alinsky, the legendary organizer of decades ago who, beyond marching, conceived clever campaigns to drive social change in the U.S.—by driving established authorities crazy.

Here is a simple example, in the spirit of Alinsky: In the late 1960s, in San Antonio, Texas, people who were fed up with their utility company overpaid their bill by 1¢. That simple cent, multiplied many times over, tied the bureaucracy in knots. It gave in.

From schoolyards to the White House to the global marketplace, it is remarkable how easily bullies can be outmaneuvered by a bit of imagination. To quote Alinsky in his book Rules for Radicals: “…the disturbance would [have to] be utterly outside the experience of the establishment, which was expecting the usual stuff of mass meetings, street demonstrations, confrontations and parades.”

David brought down Goliath with an unexpected stone. (Of course, the Bible tells us that Joshua brought down the walls of Jericho with a march. But don’t expect this to happen again.) Trump is big and boastful too—and no less vulnerable. His offensive proposals can be brought down, not by violence or the breaking of laws, but by plain old ingenuity. Hit them where it hurts, bearing in mind one of Alinsky’s basic tactics: “Ridicule is [the] most potent weapon. It is almost impossible to counterattack ridicule. Also it infuriates the opposition, who then react to your advantage.” Trump it is!

Well before Saturday, he was aware of the intense resitance to his election. Indeed, the marches may have strengthened his resolve. While millions of women were voting with their feet, on the ground, one man in the White House was consolidating a cabinet that will violate their interests. And quite the cabinet it is: Exxon and Goldman Sachs taking on the establishment! In alternate fact, there are  two establishments in America, business and government, and the stronger has just taken control of the weaker. Business no longer need merely lobby government; now it is government. Things will likely get worse before they can get better.

How, then, to get them better? Tap into the energy of Saturday’s marches. See them as the foundation on which to build a framework for action.

It is telling how many people were prepared to express their concerns publicly, no few marching for the first time. With a taste of acting together, all these people constitute a potent starting point for change—but only that. Mass action will have to follow, creatively targeted at specific proposals coming out of this administration.

Please understand that this is about more than Donald Trump. He is an extreme symptom of problems that have been festering for years, in America and, increasingly, elsewhere: income inequalities, legalized bribery (in the form of political donations), unregulated globalization run rampant, and so much more, resulting in the demise of democracy and the denigration of decency. Some voters, not knowing which way to turn, have brought into power a slew of bullies all over the world. Figuratively and almost literally, these people will be pouring oil on the fires of this planet.

It will thus fall to the concerned folks, all over the world, to do  something about this. Bear in mind what made America great in the first place: protest turned into inspired action against indecent authority.

© Henry Mintzberg 2017. Photo by Mobilus In Mobili (CC BY-SA 2.0) For more with For more on Saul Alinsky, please see:

http://www.penguinrandomhouse.com/authors/360/saul-alinsky/

 

Follow this TWOG on Twitter @mintzberg141, or receive the blogs directly in your inbox by subscribing hereTo help disseminate these blogs, we also have a Facebook page and a LinkedIn page.