Demand Ethical Leadership

Mom passed away early Christmas morning.  Her passing was a peaceful release from the body she was trapped in.  Thank you for the kind expressions of concern you offered over the past weeks regarding my mother and mother-in-law’s death.  At my age it’s strange to feel orphaned, but that’s my unshakeable feeling.

As I am preparing a eulogy for Mom, one of the things I most admire about her was her ability to somehow both forcefully and gently remind the strong men in her life to be virtuous.  Mom was kind and empathetic.  Living through a massive Depression followed by a World War that involved all her four brothers tends to amplify your compassion.  Today we live in times that call each of us in the same way.

So this morning I am watching the news about thousands of layoffs being announced by various companies across many industries.  Most of these layoffs are unethical acts of powerful leaders who think it’s responsible business.  It’s not.  It’s moral cowardice masquerading as a practical business decision.  I’m not just ranting here.  I am stating the most obvious flaw of financial capitalism that has emerged over the past 40 years.  This flaw is that short-term actions can generate short-term financial gains while destroying long-term value.  Business leaders are incented to cut jobs, investment, research, new technology and worse, pollute, mis-state earnings, corrupt lawmakers, and an endless list of shenanigans that hurt us all.  All of this, whether it’s legal, is immoral.  Here’s why.

The core standard of ethics is the mandate to never cause avoidable suffering.  Period. Is it asking too much?  Or does it ask us simply to be morally responsible for the consequences of our decisions?

One way to judge suffering caused by business decisions is something called switching costs.  Ethics requires us to consider how much it costs to the person my decision impacts to switch to another company.  So for investors the switching costs are very low.  For instance, Toyota recently announced two things.  They will likely lose money this next year, and they will continue their no-layoff policy for full-time employees.  (They are doing extra employee training during their manufacturing slowdown.)  So if an investor in Toyota doesn’t like this policy, they can sell their stock or “switch” to another one in 30 seconds online.  Switching costs for investors are very low.  Next to consider are customers.  The cost of switching from one brand of product to another of equal value is also very low.  There are so many substitute products today that consumers’ switching costs are nearly non-existent.

So what about employees?  Consider your own situation.  What if you involuntarily get laid off from a profitable business during an economic downturn?  What are the “costs” of switching to a new job or industry?  Huge.  Gargantuan.  Brutal.  The American Psychological Association reports that the two biggest traumas that are the most difficult to overcome are loss of a spouse (death or divorce) and job loss.  The suffering caused by these two events has severe long-term consequences not only on the individual directly involved but also their families.  The U.S. Department of Labor reports that 40 percent of white-collar workers over 40 laid off in the past fifteen years never achieve their previous level of income. Illness, chronic pain, abuse, divorce, alcoholism, depression, and suicide are markedly higher among laid off workers.  Is this the kind of society we want?  If a company is making money or has ample resources to continue operating, is pleasing Wall Street the highest moral good?

Is this the best business leadership we can imagine?  The much admired Jack Welch championed shareholders over all others also pioneered the mass firing of workers of GE’s profitable businesses to increase earning.  Fortune Magazine honored him as manager of the century. Right.  What’s hard about firing people and demanding everyone else work harder so we can make more money for shareholders who churn stock holdings faster than bank robbers running for their getaway car?

So if we can agree that willfully causing human suffering is immoral then profitable companies who layoff workers are by definition behaving immorally.  Consider this.  We just “donated” $350 billion to America’s banks without any oversight and they just laid off tens of thousands employees.  Meanwhile they continue to hoard our money, choke off lending to other businesses and pay their executives for their outstanding performance.  Is that okay?  Is that just “aw shucks?”  If a business leadership cannot find productive ways to use bright, loyal, hardworking employees, whose fault is that, the employee’s or the leader’s?

So how can we fix this?  Not through laws.  If we pass no-layoff regulation we’ll only succeed in making sure people don’t get hired at all.  One of America’s great advantages is our fluid workforce that allows us to change jobs and careers whenever we choose.  The difference, of course, is that when we have a well-led economy rich with job creation then employees have a playing field where we can bargain with our talent.  When we have a corrupt leadership creating fake economic gains we have mass suffering.

So what’s the best thing we can do?

Make noise.  Buy from ethical companies.  Demand ethical leadership.  A revolution is happening right now.  Employees and consumers worldwide are demanding that Corporate Social Responsibility be more than cosmetic.  We are seeing major strides in the reduction of waste and increasing sustainability.  This is all due to yours and my demands for a better future.

Now is the time to demand that Corporate Social Responsibility begins with responsibility to employees.  If Toyota and Honda can keep their employees when the car business has collapsed then so can nearly every other business if they have a will to.

I once had a large client who was going through a massive financial implosion during the dot-com era.  Their woman President didn’t layoff a soul.  She instead sponsored huge strategy workshops involving every employee in creating either cost saving or income increasing strategies.  The entire process was led by a senior maintenance man.  Yes, crazy, idealistic….well it worked.  Within 12 months the company was minting money and growing faster than ever.  Do you know why this visionary leader did this when her board was encouraging her to slash and burn?  She told me, “Our problems came from bad leadership decisions.  Firing our employees would have been immoral.”

It’s time for a new kind of leadership.

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The Rebirth of Wonder

The holiday season is upon us, along with all of the rare and beautiful opportunities it brings. No matter what name you choose to assign to it, or how you may choose to celebrate it, it will work its own special kind of magic. For just a moment we will stop what we are doing, we will share gifts, spend time with loved ones. Beautiful lights and ornaments will be placed on display, and we will stop to observe them and appreciate their beauty. It may seem like a small thing, but in reality it is a wonderful opportunity. Most of us have been conditioned to live our lives obsessing over what happened yesterday or what is coming next. We spend our lives trying to achieve this or that, and never stop to appreciate those achievements or the wonder and beauty that surround us every day. Make the most of the opportunity, breathe it in deep and take a moment, a day, a week to appreciate your life. Consider making it a way of life; and just in case you need a reminder the next holiday season is only a year away.

Do you remember the wonder and magic the holiday season held when you were a child? The Christmas tree became a shrine to wonderment, and each light glowed with magical warmth. My play would center around it, I would stare at it for long stretches of time that could not be measured because they were time-less. The smell of pine would take me away to a place behind reality, and the occasional trip to the snow with my grand parents, well that was Nirvana. No matter what holiday tradition you might have observed as a child, there were probably one or more aspects that struck you with the same sense of wonderment. And that sense of wonderment and adventure probably didn’t stop there when you were a child; most likely it accompanied anything new that awoke your senses. It is unfortunate that we tend to loose that as we go in to adulthood.

We worry about things which seem important at a given moment, but which mean nothing when observed against the wholeness of our lives. The traffic, other people’s opinions or impressions, how a project will be received, if the kids are going to do their homework correctly, and a million other things fight for every minute of our attention, and we become the slaves of our own worries if we are not careful. We forget to allow ourselves time to just be, and appreciate our relationships and our surroundings In observing the holidays we are given an opportunity to recapture the magic of youth.

So take a moment to quit thinking about what yesterday held, or tomorrow may hold, and enjoy everything you have right now.

What’s the greatest thing you can do to enjoy the magic of the holiday season?

What do you believe?

First of all, thank you all for your kind and inspiring words regarding my mother-in-law’s sudden passing and my mother’s plight as an Alzheimer’s victim.  Your insights and personal emails really matter.  It is so heartening to participate in a community of thoughtful, compassionate people who are striving to make their difference and to live lives of genuine inspiration.

Today I thought I’d just plunge in and take a big chance.  I am talking about belief in the Divine.  I know, I know.  Why do I have to bring it up at all?  Nothing is more controversial.  And it is because it matters so much.  So here’s what I propose.  I’ll tell you how I think about belief and non-belief and you tell me what you think.  No matter what, let’s agree afterwards to still be friends.

As I see it, there are two general possibilities, two scenarios. Both scenarios have their supporters.  Both sides use science to back them up.

Scenario #1 is that we are “accidental humans;” the result of a cosmic chemical spill.  A random mass of colliding electrons guided by unseen forces that proceed without any cause or meaning. Under Scenario #1, consciousness is just a by-product of biochemistry––an epiphenomenon, as the scientists say. If we accept this possibility, then all meaning is self-invented, a comforting illusion to save us from despair. With Scenario #1 values are simply the preferences we invent to help us get along. When humans decide they are the pinnacle of all intelligent life, it opens the door to genocide and child abuse being just as legitimate as charity work because if there are no universal values, life is simply about survival of the fittest. If you think this is far out, consider the long list of early 20th century leaders that believed in selectively breeding out what “science” said were low IQ races: Woodrow Wilson, Theodore Roosevelt, George Bernard Shaw, John Maynard Keynes, William Keith Kellogg, Margaret Sanger, and Winston Churchill to name a few.  Eugenics was a very popular fake science.

This view of accidental humanity is quite popular among the highly educated. In fact, it has become de facto religion in most of our colleges and universities. Several well-known twentieth century tyrants used their own version of Scenario #1 to justify their actions.  We all know what happened.  It led to the slaughter of over 150 million of us. If Darwinism is the soulless mechanism of creation, what we end up with is a life based on competing for power instead of one of meaning.

I know there are people who claim religion has done more to harm humanity than non-belief ever has.  But all the wars, intolerance, and torture didn’t happen because of a belief in a divine unseen world.  It happened because humans are corrupt.  The fact that religion doesn’t tame man’s evil doesn’t mean that life is meaningless.  To the contrary.  It makes life’s intrinsic meaning even more important.

All attempts of the “accidental humans” camp to create secular meaning are in the end meaningless. After all, if meaning is made-up, then it really isn’t meaningful. And living without real meaning is not fulfilling—never has been.  It also makes science, art, spirituality, and love meaningless. Just diversions on the road to nowhere.

Scenario #2 says that there is something more to us.  It says that we are significant humans. We are part of something that goes deeper than the electrical wiring of our brain. We are connected to a greater intelligence, a transcendent spiritual energy that is at the core of everything.

Scenario #2 isn’t made-up woo-woo. It, too, has science behind it. Its reality begins with understanding E=MC2––Einstein’s discovery that matter and energy are one and the same and that energy cannot be destroyed, only transformed.  Every physical thing, according to Einstein, is really just energy in a particular form that our particular senses interpret as matter. And energy cannot be destroyed, only changed in form. We don’t actually live in a material world.  Matter is just energy.  It is technically non-material. And the name we commonly use for things non-material is spiritual.  Spiritual energy, imagine that.

What’s wild is that the laws that govern how energy changes form seem to depend on consciousness.  Decades of repeated experiments performed by scores of mainstream renown physicists have categorically shown that human intention powerfully affects the behavior of matter/energy.  Period.  It’s no longer up for debate.  In fact it’s this property of physics that makes electrons behave in ways that make electronic circuit boards possible.  It’s ironic that every computer chip is a reminder of an invisible unexplainable reality.

Our awareness is not an after-effect but a prerequisite. It comes first, not second.  Thanks to new super-sophisticated brain surgery we now have clinical evidence the individual human consciousness does not depend on our brain being alive.  That’s right.  We now know that we can have zero brain wave activity for prolonged periods and still have conscious awareness of what is happening while our brain is switched off.  Now that’s amazing. (If you want to read about a clinical account of independent human consciousness, read The Scalpel and the Soul  by Allen S. Hamilton M.D.

So in Scenario #2, we are not, at our essence, physical, biological hunks of matter that have learned to think. Rather our biological bodies are only the temporary manifestation of some essential, eternal energy––what spiritual teachers have for millennia called our souls. In that case, the source of our true desires and noblest intentions is much deeper than our individual story, our personality, or our brain chemistry. It is an abiding, universal consciousness temporarily housing itself in our body.

What’s the importance of all this? Well, if Scenario #2 is true, then most everything we tell ourselves is important isn’t. At least not in the way we think it is. With Scenario #2, our soul belongs to a deeper spiritual reality. And in that reality love does matter.  In fact, it matters most of all.  I don’t know about you, but I’m putting my chips on Scenario #2.

What do you think?

Love Giants

This past week has been an emotional Tsunami.  My wife and I were on a plane taxing down the terminal when she got a phone call that her mother, Barbara, had suddenly died.  Those are calls we refuse to believe will ever come.  Her mom was 74 and she had wrestled with the diseases of old age, among them diabetes and arthritis and two knee replacements, but her sudden death was unexpected.

In some ways she’d outlived her body.  Nearly five years ago when Barbara was racked with relentless arthritic pain and exhausted by serial illness she seemed to get very close to death.  My wife Debbie wouldn’t stand for it.  She sat on her mother’s bed and told her that she had to stay for her father’s well-being.  For reasons beyond reason her mom rallied and lived in a broken body with her big, zesty personality turned on high until last week.

What happened to Debbie’s dad, AJ, during these past five years was what was remarkable.  AJ was born to work.  He’s 80 today and still operates his business as if his pants were on fire.  But for the past 5 suffering years he also took care of his wife.  He learned to clean, cook and gently help her.  He took her shopping and out to lunch and often just sat and listened.  He learned patience and self-sacrifice in ways he’d never learned for his first 75 years of life.  All Barbara wanted was just to be with him.  Just in the same room.  Not that she was quiet.  We once took her to see My Big Fat Greek Wedding, and she shrieked so much unrestrained laughter the audience started laughing at her laughing.  Barbara loved life so much she fought for every sacred second of it.  But AJ was transformed by her struggle.  He went from just being a powerful man to a man overpowered by his own love for his wife.

Two days after Barbara passed, my brother Tom called to tell me my mother was slipping away fast.  She is nearly 91.  She’s lived a full and amazing life.  As a girl she ran like wind and could hit the long ball.  She played first base on an all boys team.  She married Dad, moved from Los Angeles to live on a cattle ranch and help build our tree house.  She was also a community leader and the prettiest mother in my school. Four years ago she got full-blown Alzheimer’s.  The tragedy of it was she knew she was losing her mind.  Her memories went from being on mental videotape to a slide show to just an empty slide tray.  She has steadily regressed.  She became a teenager again making silly jokes and pouting when she was limited from climbing the stairs.  Recently she became like a toddler having lost her vocabulary and having to point at what she wanted.  Debbie and I flew back to California and drove 6 hours to Mom’s house.  When I saw her I was shocked.  She has become as an infant.  She simply smiles now and holds my hand and strokes my face.  She’s peaceful.  She’ll probably live a few more months.  My brother Tom rearranged his business firm so he could operate out of Mom’s house for the past 4 years.  He hired a couple of aids to help him and he’s been the primary caregiver.  Tom is 55.  He’s in many ways a typical bachelor.  He has a messy room and loud ideas.  But what’s bigger are his ideals.  What’s happened to him is a transformation.  He is so kind, so loving, so caring to Mom it is nothing short of heroic.  The word selfless doesn’t begin to describe him.  And he says there is nothing he’d rather be doing.  He’s become a very tender man.

When Debbie and I got to the emergency room to see her mother’s lifeless body, I was struck with the realization that everything we think is important isn’t.  Not the daily life stuff, not the job stuff, not the geo-political stuff or the economic stuff.  What’s really important is how much we love.  It was plain to me.  And as for my brother and father-in-law…well, they are love giants.

Corporate Responsibility OR a Disposable Society

Frankly I am amazed almost daily by the breakthroughs companies are making to create more responsible and greener products and humanitarian services.  I am not talking about superficial PR to re-label factory made food as organic or other advertising buzzwords designed to mislead us.  Rather I am impressed that global companies are making genuine progress to reinvent the future.

I have been most recently impressed when I visited the big financial firm ING to learn of their aggressive micro-credit business in India and their European car leasing operation that buys carbon credit for every mile driven to make their auto fleets carbon neutral.  I am inspired that General Electric is making organic lights that are nearly 10 times more effective than every light sold today.  Even if you’re not a raging environmentalist, you’ve got to be impressed with how companies are paying more attention to making more things more energy efficient.

The reason these trends are persisting is that consumers, especially younger ones, are demanding products that are more responsible.  Companies that are responding to this growing consumer demand will continue to grow while those who don’t will fade away.

Why General Motors is Failing

That’s one of the main reasons General Motors is sucking air.  My brother-in-law once owned a GM Geo Metro, a dog of a car if there ever was one.  As the tin and can aged he noticed that the price of parts was beginning to exceed the value of the car.  Finally a mechanic told him, “Hey, the Geo was designed as a disposable car and guess what, it’s time to junk it!”  A disposable car.  Hmmm.

A Disposable Society

In the 1950’s the big American car company accountants came up with the brilliant idea of planned obsolescence that required engineers to design parts to fail at 50, 60, or 70 thousand miles.  This, they were told, would increase their downstream parts business.  What a tragic idea.  But this has been the mindset of leadership over the past 40 years—create one big disposable society.  Disposable cars, disposable marriages and fast food that has as much nourishment as the cardboard package it comes in.  Have we gotten so seduced by “new” things that we have lost sight of the quality of our lives and the strength of our society?

Americans are Rethinking Their Addiction to Waste

Americans are a resilient people.  We seem to have un-ending ingenuity.  So inventors, engineers, and increasingly companies are re-thinking their addiction to waste.  They are doing so because we are demanding it and our children are demanding it.

So what’s the best thing we can do? We should all be fully engaged, noisy consumers.  We need to demand genuine quality, real nutrition, and yes environmentally responsible products.  We should demand personalized, low-stress service to be treated like a person instead of a problem.  The louder our voices are in the market place, the more it will change.  I am seeing this first hand.  Of course progress is slow and imperfect, but at least there is progress.  Progress caused by us.

So what do you think?  Am I into something or is my view to rosy?  What’s the best thing you can think of to drive business to become more responsible?

Corporate Social Opportunity with Organic Light Bulbs

Yesterday I met with the owners of eFactor Media about one of their name brand clients who is a leader in creating the next generation of lighting.  It’s called organic light emitting diodes or OLEDs.  The world has been waiting for affordable OLED lights for a long time.  They light 10 times longer than the longest lasting florescent lights, have no mercury and now are made out of organic polymers.  The vision is that in the coming decades all electric lights in the world will be replaced with lighting that uses a fraction of the current energy to manufacture and illuminate.  This is a genuine opportunity to help create a more sustainable future that brings the benefits of technology to all corners of the globe.

It also turns out that literacy rates go up by where electric lights are introduced because it creates more productive awake time to read and learn and even to do homework.  What my colleagues and I were talking about is how to help this global technology company translate their green science into a culture with the visionary zeal to convert the world’s use of lights to organic ones.  This is how Corporate Social Responsibility becomes Corporate Social Opportunity.

The Simple Truth About Economics

We have the potential to do great things, amazing things in fact. Each man and women, represents the currency of that potential. Each of us has skills, knowledge, and abilities that can be used to work wonders if given the opportunity.

The economic down turn that we are experiencing represents a failure to tap that potential. As a matter of fact, the solution is quite simple when one boils away the complications, and excuses that allow it to persist. It can be described in the following equation:

Identify needs – put a sufficient number of people to work producing those needs – put the remainder to work producing wants and improvements = healthy economy

If we were to do just that, everything we needed, and much of what we wanted would exist in abundance, and (in a healthy free market) exist at reasonable prices. Unemployment would be practically non-existent in terms of people who were willing and able to work, and we could achieve remarkable prosperity as a society.

Too simple you say?

Why? Does it have to do something with the infusion of capitol, or the circulation of money?

If it does, that is rather revealing of a fundamental problem with our economic belief system. It assumes that we are trying to produce money, and that our wants and needs are a by product of that money. Think about this for a moment. Is money what you really want to produce? Does the money have any intrinsic value beyond the paper it is printed on? Beyond that, money is only as valuable as the general public believes it to be, and in the wrong hands it can be used as a tool to deprive people of the real resources they need to survive, while producing nothing of real value in return.

Don’t get me wrong, money is a great tool to facilitate trade. But money is after all, only a tool. In reading “The Forgotten Man”  Amity Shlaes insightful look at the great depression, I was amazed by the manner in which some communities responded to the onslaught of the depression. As the local banks went dry, or shut down all together, they did not crumble in to despair or stop working all together, but reached deep in to their own innovation and set up small local economies to meet their basic needs. Many of those local economies began with basic bartering, and some even developed their own local currencies. They understood the need for self sufficiency, and went about the work of meeting their needs.

Each of our communities today should look to that example, and insure that there is no essential need that can not be met locally. Certainly our lives are deeply enriched through outside trade, and it is difficult to imagine a life deprived of things as simple as bananas or any of the many gadgets, brought to us from over seas, that make our lives simpler or more enjoyable. But we must stop to ask if we really want our lives, not only to enriched, but to depend on that trade? In many ways we have done just that through our dependence on foreign oil, and it has left the United States vulnerable in many respects.

We have the people, the resources, and the potential to do great things. We can create innovative new sources of energy, abundant housing, truly advance medical science in to the 21^st century, or any one of a thousand noble goals. That or we can worry about how to produce more money. Which one would you prefer?

It begins with a vision; it begins with you and me pushing to make that vision a reality, and with leaders who have the courage to point the way and give people the opportunity. We can turn things around by producing real things to meet real needs. It is, just that simple.

What is the Greatest thing we can produce to give people better lives?