Why You Should Love Accountability

“Two are better than one, because they have a good return for their labor:
If either of them falls down, one can help the other up.
But pity anyone who falls and has no one to help them up.”

-Ecclesiastes 4:9-10

We are all pretty good at detecting when others have hidden motives. Perhaps, a colleague says something that on the surface supports you while he is secretly working to undermine you. You know something is wrong, even if you can’t pin it down. Maybe a client tells you what you want to hear with no intention of following through. You know something is off. They think they are hiding it well, but they should know better. Humans have remarkably good BS detectors.

Seeing the Problems

I am excellent at critiquing others’ stupid mistakes. This is partly due to my academic training and partly due to experience. For example, I have become pretty good at predicting how managers’ actions impact employees. I see the masked demoralization when managers lie to their subordinates; I see the arrogant manager’s pride as he thinks he put one over on his people. I see it all in Technicolor. They think that they are clever, when in reality, they are undermining commitment and trust. If you have seen it before you can see the ripple effect that follows. Maybe you are a student of human nature, and you can see this too.

We have very good BS detectors when it comes to others. But we are terrible when it comes to detecting duplicity and impure motives in ourselves.

I hate to admit it, but while I am excellent at recognizing other’s faults, I am very poor at recognizing my own. I have come to conclude that I need help. I need someone who can stand next to me and tell me that which I need to hear when I am about to make stupid decisions. That is difficult to admit, but it is true.

Don’t Follow Your Heart

Disney movies tell you to follow your heart, but the scripture says that, “The heart is deceitful above all things and beyond cure. Who can understand it?” (Jeremiah 17:9). The advice points us in two different directions, but which one is true?

Following your heart may work when you think about what you want to do with your life. When you consider your strengths, talents, gifts, and the type of work that you find fulfilling, following your heart may be sound. But it is terrible advice when it is the only advice.

Humans have a tremendous ability to rationalize that which they want but know to be wrong. They willfully violate their conscience and then create rationalizations to support why it wasn’t wrong in their situation. The philosopher Dennis Peacocke reminds us that, “the mind justifies what the heart has chosen.”

It is this imperceptible creep toward what we know to be wrong that is the root cause of most ethical scandals. You give yourself a pass for the very thing that you condemn in another person. I do it. You do it too. Few people who have been brought down in such scandals started out totally corrupt. More often than not, they moved imperceptibly from one small transgression to another until they found themselves tangled in the web that they spun.

Last week, General Michael Flynn resigned, earning the record for the shortest time a National Security Advisor held office. He resigned after lying to Vice President Pence about contacts he had with the Russian government before officially taking office—a violation of the Logan Act. The Logan Act was signed into law by President John Adams. Though no one ever has been charged with violating the law, the Logan Act makes it a felony for a private citizen to negotiate with a foreign government in order to undermine the government’s official position. Flynn apparently did this by reassuring the Russians of the next administration’s disposition toward them after President Obama placed sanctions on them in December 2016. It is an open question if Flynn violated the Logan act, directly or indirectly, but he lied to Vice President Pence, and that ultimately led to his resignation.

At a press conference on Thursday, February 16, President Trump defended Flynn while he explained why he asked for Flynn’s resignation:

Mike Flynn is a fine person, and I asked for his resignation. He respectfully gave it. He is a man who there was a certain amount of information given to Vice President Pence, who is with us today. And I was not happy with the way that information was given.

He didn’t have to do that because what he did wasn’t wrong.

If, in a neutral environment, a subordinate had asked General Flynn whether a private individual should undermine the official chain of command, he would certainly counsel him not to do it. He knew better. Flynn, a retired 4-star general, had an impressive career culminating as the Director of the Defense Intelligence Agency. But he did it. I don’t know what justification he gave himself or if he even realized what he was doing at the time, but he apparently crossed the line. Then he lied about his actions, placing the vice president in an awkward position as he repeated what Flynn told him. At the same time, he opened himself up to potential blackmail by the Russians and he lost the trust that the president needs to have in a National Security Advisor.

The Ethical Blind Spot

We can clearly see the bad choices others make, but we have an ethical blind spot when it comes to ourselves. This is why great leaders love accountability. They do not see accountability as a hindrance to their autonomy, but guardrails that keep them from going over the cliff. The guardrail does, limit their freedom, but it does so to protect them from the kind of freedom that will destroy them.

Do you have accountability in your life? Who have you let in that has the right to speak truth to your situation?

-Darin Gerdes

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gerdes

Dr. Darin Gerdes is an Associate Professor of management in the School of Business at Charleston Southern University. All ideas expressed on www.daringerdes.com are his own.

 

This post was originally created for Great Business Networking (GBN), a networking organization for business professionals where Dr. Gerdes is the Director of Education.

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Leading Up

“Rank does not confer privilege or give power. It imposes responsibility.”

Peter F. Drucker[i]

Last night in class, a student asked about a difficult situation. We were talking about leading people properly, and one student said that while she thought what we were talking about was great, she was not sure how practical it was. Then, she told us about her problem.

For the sake of anonymity, we will call her Jen. Jen is a middle manager and she recently uncovered a number of significant organizational problems. She had scheduled an appointment with her boss for the next day. She felt that she had to address these issues with him as soon as possible, but she was not sure how to go about it. Because her situation was relevant to leadership, we devoted some time to talking about it in class.

Without going into the details, you just need to know that it would be a Crucial Conversation.

CrucialGrenny, McMillan, Switzler, Covey & Roppé define crucial conversations as “A discussion between two or more people where (1) stakes are high, (2) opinions vary, and (3) emotions run strong.”[ii]

In Jen’s case, multiple issues had surfaced so she reluctantly made the appointment because they had to be addressed. Suffice it to say that it was a political minefield, and she was not looking forward to the conversation. Her classmates were wonderful as they offered support. They came to the following conclusions that I will share below.

 

What You Can Control

First, they determined whether it was a conversation that she needed to have. It was. To avoid the conversation would be to fail as a leader. Jen was ethically (and perhaps even legally) obligated. Her people were depending on her, and she did not want to let them down.

I sympathized with Jen because I have had difficult conversations too. On one occasion, I had to tell an applicant that she could not enroll in our graduate program because the college she attended (where she likely spent $50,000 or more to get a degree) was not accredited.

On other occasions, I have had to tell students that failed their final class that they were expelled and that they would not be earning an MBA. Our graduate program has a rule that three Cs or one F automatically leads to expulsion from the program. In some cases, family and friends had come to local hotels to see these students graduate. After two years of hard work, this was awkward, embarrassing, and painful.

Those were tough conversations, but in each situation, I was the one in power. Jen’s situation was more complicated. She was trying to figure out how to approach the boss about these situations knowing that her boss held all of the power. He could act, or he could do nothing, or he might be vindictive and demote her or fire her.

In A InfluencePassA passionion for Leadership, Robert Gates quoted Samuel Goldwyn’s quip, “I don’t want any yes-men around me. I want everyone to tell me the truth, even if it costs them their job.”[iii] A good boss wants the truth, but to get it, his employee must know that it is safe to bring him bad news.

Often we do not want to bring bad news to the boss because historically, those in power have had the tendency to “punish the messenger.” In Influence: Science and Practice, Robert Cialdini explained that in ancient Persia, imperial messengers were honored if they brought good news about a battle to the king, but they were slain if they brought bad news.[iv] They were not even responsible for what happened—they were just the messenger, but it did not matter. This was Jen’s predicament.

Grenny, McMillan, Switzler, Covey & Roppé explained that what makes a difficult conversation a crucial conversation, “not simply challenging, frustrating, frightening, or annoying—is that the results could have a huge impact on the quality of your life. In each case, some element of your daily routine could be altered for better or worse.”[v]

Yet, you must be able to speak the truth. An environment where the truth cannot be spoken will inevitably decline. Truth protects and corrects when things go wrong.

Since she felt that she had to have the crucial conversation, the question then became how to approach her boss—how to speak truth to power. Her classmates agreed that she needed to address the serious situation. They encouraged her to focus on her attitude as she approached him. While she was frustrated by what was happening, she needed to be sure not to use it as an opportunity to vent. She needed to ensure that her attitude was one of concern. After all, she was just trying to do right by her people, her organization, and her boss.

It is hard to be angry toward someone who is trying to serve and protect you. Her classmates argued that her concerns would be well received if the boss recognized this. As the proverb states, “Wounds from a friend can be trusted” (Proverbs 27:6a).

What You Can’t Control

In spite of the great advice that her classmates gave her, there was no guarantee that her boss would be receptive to her concerns. You cannot control other people. You cannot control their perceptions. You cannot control their reactions, and you cannot control the final results.

Jen is not responsible for her boss’s reaction. She is only responsible for her actions. To that end, while she wants to present her case in as palatable a form possible, ultimately, the end result is out of her control.

Leading Up is a Process

One more thing is important here. Jen needs to understand that this may be a process. In an ideal world, reason reigns supreme, the just always triumph, and right prevails in the end. But we do not live in such a world. Our world is fallen, and sometimes things do not go as planned. If she makes a dent, it may take time to unwind the issues.

Whatever happens, I am proud of Jen. She identified the issues that were problems before they overwhelmed her. That is good management. And, she is willing to take a risk to support and defend her people. That is good leadership.

Have you ever been caught in this type of situation? If so, what did you do? If you are in that place in the future, what will you do?

-Darin Gerdes

 

[i] Drucker, P. F., & Kirsch, S.L. (1990, April 23). The best book on management ever: Peter Drucker argues that his friend, former GM chairman Alfred Sloan, wrote it 26 years ago. Among Sloan’s timeless tips: Real leaders are swayed by facts, not personalities. Fortune. Retrieved from http://archive.fortune.com/magazines/fortune/fortune_archive/1990/04/23/73427/index.htm

[ii] Patterson, K., Grenny, J., McMillan, R., Switzler, A., Covey, S. R., & Roppé, L. (2011). Crucial conversations. Tools for talking when stakes are high. New York: McGraw-Hill.

[iii] Gates, R. M. (2016). A passion for leadership: Lessons on change and reform from fifty years of public service. (p. 119).

[iv] Cialdini, R. B. (2009). Influence: Science and practice. Boston: Pearson Education.

[v] Patterson, K., Grenny, J., McMillan, R., Switzler, A., Covey, S. R., & Roppé, L. (2011). Crucial conversations. Tools for talking when stakes are high. New York: McGraw-Hill.

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gerdes

Dr. Darin Gerdes is an Associate Professor of management in the School of Business at Charleston Southern University. All ideas expressed on www.daringerdes.com are his own.

This post was originally created for Great Business Networking (GBN), a networking organization for business professionals where Dr. Gerdes is the Director of Education.

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A New Vision for the Chicago Police Department: A Case Study

“The system that you have is perfectly geared to give you what you are getting.”

-Newt Gingrich

           2016 was the bloodiest year since the early 1990s in the Windy City. The Chicago Tribune reported more than 4,000 shootings and 762 homicides in 2016 (Rossberg-Douglass & Briscoe, 2017)—more than New York and Los Angeles combined (Whitaker, 2017). This is even more remarkable when you consider the relative size of each city. Chicago has a population of 2.7 million people. It’s population is roughly half the size of the state of Colorado. New York City has a population of 8.4 million and Los Angeles has nearly 3.9 million for a combined 4.5 times the population of Chicago.
           In fairness, the increase in violence has affected other cities too, but Chicago deservedly gets most of the attention. According to the Wall Street Journal, Homicides rose in 16 of the 20 largest US cities in 2016. The only 4 that did not rise are New York, Milwaukee, Baltimore, and Washington, D.C. (Calvert & Mahtani, 2016). But the rise in these other cities has been minimal.
           Chicago has received national attention for gun violence over the last few years. Politicians of all stripes have pointed out the problems in Chicago. Even President-elect Donald Trump commented on the violence in a tweet:

Screen Shot 2017-01-26 at 8.53.29 AM

           In a New Year’s Day news conference, Police Superintendent Eddie Johnson claimed that 2017 would be safer than 2016, but Chicago experienced its first murders in the wee hours of New Year’s day. Two men got into an argument in a bar, shooting and killing each other (Rossberg-Douglass & Briscoe, 2017). In fact, dozens of people were shot on New Year’s Day as reported by the Chicago Sun Times (“Map: New Year’s,” 2017):

1:05 a.m. Sunday — 2 shot in Cragin
1:41 a.m. Sunday — Woman shot in drive-by on Near West Side 
2 a.m. Sunday — 3 shot during party in Bronzeville
2:13 a.m. Sunday — Man grazed by bullet in Wentworth Gardens
2:15 a.m. Sunday — Woman grazed in shooting in West Chesterfield
2:20 a.m. Sunday — Woman shot in Englewood drive-by
2:30 a.m. Sunday — Man, 24, shot in Brainerd
3:46 a.m. Sunday — 3 wounded, 1 critically, in Morgan Park
3:55 a.m. Sunday — Man grazed in the head in Englewood shooting
4:30 a.m. Sunday — 2 fatally shot in Uptown
5:30 a.m. Sunday — Man, 52, shot in Back of the Yards
5:53 a.m. Sunday — Man shot to death in West Garfield Park
11:16 a.m. Sunday — 2 in custody after man shot in Austin
1:40 p.m. Sunday — 17-year-old boy shot in Gage Park
2:35 p.m. Sunday — Man shot in Park Manor
3:48 p.m. Sunday — Man shot in West Pullman
7:28 p.m. Sunday — 16-year-old boy shot in East Garfield Park
9:40 p.m. Sunday — Woman, 48, shot multiple times in Lawndale
10:55 p.m. Sunday — 3 wounded in Austin drive-by shooting

           According to Media Matters, gun crime has steadily fallen since it’s height in 1992 through 2011 (Boehlert, 2013).

Screen Shot 2017-01-26 at 8.55.29 AM

           The murder rate rose again briefly in 2012, and it resumed 2004-2011 levels until 2015, when it began rising sharply in 2016. Why is this happening in Chicago? Why is it happening now?

Causes and Consequences

           Liberal politicians and newspapers claim that the problem is guns, but Chicago has always had guns, and it has some of the tightest gun control legislation in the United States. The Center to Prevent Gun Violence scores all states for gun control regulations. Illinois earned a B+ and it has the 8th strongest gun control regulation in the nation (“Gun law,” 2016).
           Mayor Rahm Emanuel announced a gun buy-back program on October 19, 2015 (“Mayor Emanuel Announces,” 2015). Moderate Republican Illinois Governor Bruce Rauner signed a law on August 23, 2016 that imposes stiffer penalties on illegal guns from outside the state (HB 6303). In spite of such efforts, the problem persists.
           Conservative politicians point to a failure of leadership on the part of the mayor’s office and the police department. After all, Rahm Emanuel, Barack Obama’s former Chief of Staff became the Mayor of Chicago on May 16, 2011, just before the first increase in violence in 2012. Of course, that fact alone is insufficient. Chicago has not had a Republican mayor since 1931.
           Perhaps the problem is a lenient court system in Illinois. According to the New York Times,

Chicago is more lenient about illegal handguns than New York, prescribing a one-year minimum for possession versus three and a half years in New York. An attempt to match the New York law in 2013 was rejected by the Illinois legislature out of concern for skyrocketing incarceration rates for young black men. (Fessenden & Park, 2016, para. 8)

           Other factors may also be at play. University of Illinois Criminologist, John Hagedorn explained to National Public Radio that in the 1990s, the Chicago police “cleared” two out of three homicide cases. That means that the police knew the suspect. Presently, they only clear one in four (Bryan, 2016).
           In addition, the Chicago Police Department has had an uneasy relationship with the community. Whatever relationship they might have had was shattered on October 20th, 2014 when Laquan McDonald was shot by police. Police responded to a report of someone breaking into cars at 9:45 PM. After a police chase, officers approached McDonald, commanding him to drop the knife he was carrying (Ford, 2014).
           He was a suspect, and he was ignoring police commands, but he was clearly not lunging toward an officer with a knife, contrary to the officer’s initial report, when he was slain. Police dash cam shows that he was shot 16 times while walking away from the officer.
           The incident led to a year-long standoff between city officials and the community. By February, the city began negotiating a settlement with the family for $5 million (Peralta, 2015). By March, protesters in the streets were chanting, “Black Lives Matter,” echoing similar scenes playing out across the country (Wisniewski, 2015). While these events may or may not have influenced the decision-making at City Hall, it is worth noting that Rahm Emanuel was running for reelection at the time. He would be re-elected in April of 2015.
           Protesters marched throughout November. Nevertheless, City Hall refused to release the dash-cam video and tensions came to a boil. Finally, a Cook County judge ordered it released to the public and events unfolded quickly. The officer was charged with first-degree murder on November 24th, 2015. The video was released on November 26th. After seeing what happened, the city erupted in protests. Five days later, Mayor Emanuel fired Police Superintendent McCarthy (Husain, 2016).
           McCarthy believes that he was made to be the fall guy (Garcia, 2016). According to a 60 Minutes investigative report, “Within six weeks of the shooting scandal, investigative stops fell by nearly 35,000. That’s when the violence began to surge” (Whitaker, 2017).

The Bigger Picture
           Chicago’s violence has not taken place in a vacuum. Over the last few years, a number of events have impacted public sentiment. The most notable is the Black Lives Matter movement. While Chicago anguished over Laquan McDonald’s murder, the rest of the nation watched Furguson burn after the policeman who shot and killed Michael Brown was acquitted. They watched protests in New York City flare up after a failure to indict the officers in Eric Garner’s tragic death at the hands of police.
           Culture appears to have shifted. Police were openly villainized by large swaths of the population and this sentiment had gone mainstream as the Black Lives Matter movement gained momentum.

          A Brief History of Salient Events in the BLM Movement[1]

  • 2/26/12 – [Sanford, FL] Trayvon Martin was shot by George Zimmerman, a neighborhood watch coordinator.
  • 7/13/13 – [Sanford, FL] George Zimmerman was acquitted.
  • -Black Lives Matter formed by community organizers Patrisse Cullors, Alicia Garza, and Opal Tometi.
  • -The hashtag #BlackLivesMatter first appears on Twitter.
  • 7/17/14 – [New York, NY] Eric Garner died at the hands of police during an arrest over selling illegal cigarettes. He repeatedly told officers, “I can’t breathe.”
  • 8/9/14 – [Ferguson, MO] Michael Brown killed as he attempted to evade arrest. Eye witnesses claimed that he had his hands up (which was later proven false).
  • 10/20/14 – [Chicago, IL] Laquan McDonald was shot. Authorities said he had a knife. The community argued that he was murdered in cold blood and that he did nothing wrong.
  • 11/22/14 – [Cleveland, OH] 12 year-old Tamir Rice was killed while carrying a toy gun.
  • 11/24/14 – [Ferguson, MO] No indictment of Officer Darren Wilson. Protesters became rioters and Ferguson burned.
  • 12/3/14 – [New York, NY] No indictment in the Eric Garner killing led to protests.
  • 12/20/14 – [New York, NY] Two police officers were assassinated sitting in their car.
  • 4/4/15– [North Charleston, SC] Walter Scott was shot dead while running away from an officer.
  • 4/19/15 – [Baltimore, MD] Freddie Gray died while in a police vehicle. His death leads to immediate protests and riots.
  • 6/17/15 – [Charleston, SC] A self-proclaimed white racist shot 7 innocent parishioners at a bible study at Mother Emanuel Church.
  • 8/28/15 – [Cypress, TX ] Shannon Miles murdered Harris County Deputy Darren Goforth, shooting him 15 times while he was pumping gas at a Chevron Station.
  • 11/7/15 – 11/11/15 – [Columbia, MO] Protests erupted at the University of Missouri.
  • 11/15/15 – [Minneapolis] Jamar Clark was killed during domestic disturbance call leading to protests at the police station.
  • 11/26/15 – [Chicago] Authorities release the video of the Laquan McDonald shooting per judge’s order leading to increased protests.
  • 7/5/16 – [Baton Rouge, LA] Alton Sterling was fatally shot during arrest leading to protests. It appeared taht he was subdued and lethal force was not necessary.
  • 7/6/16 – [Falcon Heights, MN] Philando Castile fatally shot. His girlfriend, Diamond Reynolds, live-streamed the video on Facebook.
  • 7/7/16 – [Dallas, TX] Michah Xavier Johnson opened fire on police officers at a Black Lives Matter protest in Dallas, killing 5 officers, injuring 9 officers, and two civilians.
  • 7/5/16-7/15/16 – [United States] Over 100 Black Lives Matter protests were conducted in 88 cities over the 10 day period.
  • 7/17/16 – [Baton Rouge, LA] Three officers were shot dead as retaliation for Alton Sterling’s death two weeks earlier.
  • 7/28/16 – [Chicago, Il] Paul O’Neil was shot in the back and killed after a police chase, leading to protests.
  • 8/14/16 – [San Francisco] Collin Kaepernick sat in protest the national anthem.
  • 9/20/16 – [Charlotte, NC] Keith Lamont Scott was shot by police. His family claimed he was carrying a book, not a gun and the city erupted in days of protest and riots. He actually was armed according to a November 30th District Attorney report.

Policing Chicago in 2016

           Police work is dangerous. In 2015, 86 officers died in the line of duty, but of those killed, a number were targeted simply because they were police. “Four were ambushed,” and “three were killed in unprovoked attacks,” according to the FBI (“FBI Releases 2015 statistics, 2016). This was before the publicized 2016 attacks in Dallas, at a Black Lives Matter protest that turned deadly for five officers or the three officers targeted in Baton Rouge in July of 2016.
           The atmosphere in Chicago is particularly difficult for police. According to the Chicago Sun Times the spike in violence was initially blamed on the “Ferguson effect,” but the “ACLU effect,” may be more chilling (Main, 2016). Chicago police have demonstrably pulled back whether through fear of greater scrutiny or additional burdens placed upon them. The Sun Times Reported:

Starting in January, officers have been required to fill out two-page forms documenting every stop of a citizen for everything from traffic violations to investigative stops. They ask for much more information than the previous one-page “contact cards” officers filled out.

In interviews with officers and sergeants over the past month, a common theme has emerged: Cops say they have avoided making many of the stops they would have routinely done last year. They fear getting in trouble for stops later deemed to be illegal and say the new cards take too much time to complete. (Main, 2016)

           On New Year’s Day 2017—one year after the new rule went into place—60 Minutes aired a segment on the murder rate in Chicago. They reported:

We were astonished by data we obtained from inside the police department. It revealed that as killings rose, police activity fell. In August of 2015, cops stopped and questioned 49,257 people. A year later those stops dropped to 8,859, down 80 percent. At the same time arrests were off by a third, from just over 10,000 to 6,900. (Whitaker, 2017)

           Karen Sheley, director of police practices for the Illinois ACLU believes that the new regulations are good because they reduce the number of invasive stops. After all, stop-and-frisk stops disproportionately affect blacks. According to the US Census bureau, only 32% of the population of Chicago is black, but an ACLU report found that blacks accounted for 72% of these police stops (Main, 2016).
           Sheley also dismisses the connection between the new regulations and increased violence in Chicago (Main, 2016). But the police do not share this perspective. According to Ex-Superintendent McCarthy,

When you have activity falling off the way it is and crime skyrocketing, that’s a huge problem….

Officers are under attack. That’s how they feel, right. That’s how they feel in this environment, and they’re not going to put themselves and their families in jeopardy.

Frustration among cops deepened with a new order to be more selective about who they stopped, and write a two-page detailed report for every one. It was the result of a threat by the American Civil Liberties Union to sue the department for racial profiling….

[Filling out the report] could take you up to 45 minutes and one of the things in policing that we’ve been trying to do is knock back the amount of time that officers spend doing paperwork and get them out doing more proactive things to prevent crime. (Whitaker, 2017)

           Chicago police do not feel support from City Hall. Though the mayor has announced that he will hire 1,000 new police officers (Bryan, 2016), the demoralization of the police force is palpable. When Brian Warner, a former Chicago cop, shot in 2011 was asked what was happening at CPD, he described how officers pulling back:

Aggressive patrol when you’re out looking for people breaking the law. That’s not happening as much as it was….And how could you ask them to be? And why would you expect them to be?…It’s my job to go to work and listen to your 911 calls and respond. That’s the basic ability of my job. So if you want me to do the basics that’s what I am doing now. (Whitaker, 2017)

           It is a sad situation and everyone is miserable. No one in their right mind wants police to use excessive force. The #BlackLivesMatter movement has made this clear. Neither do they want the police to feel that they are targets for assassination as the #BlueLivesMatter counter movement has made clear. Certainly, no one wants a scenario where fifty-nine rival gangs make life a war zone for the innocent citizens who suffer because of inadequate police protection.

The Scenario

           You were just hired as the new Chicago Police Superintendent charged with fixing this broken system. What do you do?

 

References

Bryan, M. (2016, December 28). Gun deaths in Chicago reach startling number as year closes. National Public Radio. Retrieved from http://www.npr.org/2016/12/28/506505382/gun-deaths-in-chicago-reach-startling-number-as-year-closes

Boehlert, E. (2013, June 19). The truth about Chicago’s falling murder rate. Media Matters. Retrieved from http://mediamatters.org/blog/2013/06/19/the-truth-about-chicagos-falling-murder-rate/194521

Calvert, S., & Mahtani, S. (2016, December 22). Homicides rose in most big cities this year. The Wall Street Journal. Retrieved from http://www.wsj.com/articles/homicides-rose-in-most-big-cities-this-year-1482402602

Fessenden, F., & Park, H. (2016, May 27). Chicago’s murder problem. The New York Times. Retrieved from http://www.nytimes.com/interactive/2016/05/18/us/chicago-murder-problem.html?_r=0

Ford, Q. (2014). Cops: Boy, 17, fatally shot by officer after refusing to drop knife. The Chicago Tribune. Retrieved from http://www.chicagotribune.com/news/local/breaking/chi-chicago-shootings-violence-20141021-story.html

Garcia, J. (2016, March 9). Former Supt. Garry McCarthy speaks for the first time since firing. ABC News. Retrieved from http://abc7chicago.com/news/former-supt-garry-mccarthy-speaks-for-first-time-since-firing/1238805/

Governor Rauner signs firearms trafficking bill to help protect communities from gun violence. (2016, August 23). Illinois Government News Network. Retrieved from http://www3.illinois.gov/PressReleases/ShowPressRelease.cfm?SubjectID=2&RecNum=13763

Gun law state scorecard. (2016) Law Center to Prevent Gun Violence. Retrieved from http://gunlawscorecard.org/

Husain, N. (2016, September 12). Laquan McDonald timeline: The shooting, the video and the fallout. The Chicago Tribune. Retrieved from http://www.chicagotribune.com/news/laquanmcdonald/ct-graphics-laquan-mcdonald-officers-fired-timeline-htmlstory.html

Rosenberg-Douglas, K. & Briscoe, T. (2017, Jan 2). 2016 ends with 762 homicides; 2017 opens with fatal uptown gunfight. Chicago Tribune. Retrieved from http://www.chicagotribune.com/news/local/breaking/ct-two-shot-to-death-in-uptown-marks-first-homicide-of-2017-20170101-story.html

Map: New Year’s weekend shooting tracker. (2017, January 1). Chicago Sun Times. Retrieved from http://chicago.suntimes.com/news/map-new-years-weekend-shootings-tracker/

Main, F. (2016, January 31). Street cops say ‘ACLU effect’ drives spike in gun violence. Retrieved from http://chicago.suntimes.com/politics/street-cops-say-aclu-effect-drives-spike-in-gun-violence/

Mayor Emanuel announces new buy-back program to get guns off the street. (2015, October 19). City of Chicago. Retrieved from https://www.cityofchicago.org/city/en/depts/cpd/provdrs/police_services/news/2015/october/mayor-emanuel-announces-new-buy-back-program-to-get-guns-off-the.html

Peralta, E. (2015, December 1). Chicago Police Superintendent Garry McCarthy fired. National Public Radio. Retrieved from http://www.npr.org/sections/thetwo-way/2015/12/01/458018005/amid-criticism-chicago-mayor-emanuel-asks-police-chief-to-resign

Trump, D. [RealDonaldTrump]. (2017, January 2). Chicago murder rate is record setting – 4,331 shooting victims with 762 murders in 2016. If Mayor can’t do it he must ask for Federal help! [Tweet]. Retrieved from https://twitter.com/realDonaldTrump/status/815973752785793024

Wisnewski, M. (2016, March 24). Three arrested as Chicago protesters demand police reforms. Reuters. Retrieved from http://www.reuters.com/article/us-usa-chicago-police-protest-idUSKBN0MK27M20150324#6g77MosfDso29GjZ.97

Whitaker, B. (2017, January 1). Crisis in Chicago. [Television broadcast]. In Campanile, G., Bast, A., & Radutzky, M. (Producers), 60 Minutes. New York, CBS Broadcasting.

[1] For Black Lives Matter’s own view of the movement, see BET’s Stay Woke.

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Dr. Darin Gerdes is an Associate Professor of management in the School of Business at Charleston Southern University. All ideas expressed on www.daringerdes.com are his own.

 

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Why Your Reorganization Will Fail

Organization_Chart_of_a_large_Company_Manufacturing_Stoves,_1914

Few activities are as maddening as a reorganization. In A Passion for Leadership: Lessons on Change and Reform from Fifty Years of Public Service, Robert Gates explained:

One strategy new leaders often use in reform initiatives is reorganizing the bureaucracy. But all too often, they confuse organizational and name changes with real change. They believe that moving the boxes around on the organization chart, changing the lines for who reports to whom, making dotted lines into solid lines, and the like will fix problems and represent real change. They are nearly always wrong. When you get a new boss who is bent on changing things by changing boxes, it usually means he isn’t really serious about change or he doesn’t understand how to lead it. If a leader wants real change, he must realize the main target is how people do their work, not where. How you make people more efficient and productive, more effective, more responsive, more open-minded, better at their jobs, is little affected by the placement of their organization on the chart….

Rearranging the organizational boxes, especially if it involved physical relocations, also is enormously distracting to an organization. Employees will be preoccupied with whether their personal and office status has improved or declined in the reorganization—as well as whether in the game of bureaucratic musical chairs they might find themselves without a job….

Whether in the public or the private sector, try to leave the boxes, both actual and organizational, alone unless absolutely necessary.[1]

A passion for leadership

Gates is not alone in his assessment. Former Avis CEO, Robert Townsend, included the following gem in Up the Organization: “I was to learn later in life that we tend to meet any new situation by reorganizing; and what a wonderful method it can be for creating the illusion of progress while producing confusion, inefficiency, and demoralization.”[2]

Up the Organization

In Management, Drucker named the disease “organizitis,” and described it as a sort of hypochondria. He explained, “Reorganization is going on all the time. At the first sign of any trouble, a cry goes up for the ‘organization doctors,’ whether outside consultants or internal staff. And no organizational solution ever lasts long.” He concluded, “Organization changes should not be undertaken often and should not be undertaken lightly. Reorganization is a form of surgery, and even minor surgery has risks.”[3]

Reorganization Usually Doesn’t Work

Why the sour assessment of reorganization?

The reason is simple. Reorganizations rarely work. I have observed a number of them up close and at a distance, and nearly all were disasters.

Yet, while you are going through one, company leaders talk about it in glowing terms. You never hear anything about the difficulties. To hear company leaders talk, if you did not know better, you would wonder why they haven’t launched this master-stroke before. But there is no quick fix for what ails us. Why do we continue to act in ineffective ways?

In fairness, reorganization is sometimes necessary, but they tend to be the “Hail Mary pass” in the executive’s playbook. When we have no better strategy, we reorganize.

But if reorganizations are so often ineffective, what should we do?

What Works

Gates answered the question. Focus on how the work is done, not where. Focus on efficiency, not who reports to whom. Focus on alignment with the mission rather than the number of subordinates on the organizational chart.

This perspective was confirmed by academic research on reorganizations. In 2012, the Boston Consulting Group issued a report that provided an answer. Their sample study found that 90% of large companies recently went through some sort of restructuring. “Yet as common as reorganizations have become, what’s even more common is their high failure rate. Less than half of all reorganizations in our survey were considered successes.”[4]

The authors of the study identified six critical factors that increase the odds of a successful reorganization.

  1. Synchronize design with strategy: This means that the reorganization follows a change in strategy. The organization is re-aligned to do more of one thing and less of another in accordance with the new focus.
  2. Clarify roles and responsibilities: Specific roles, levels of authority, and accountability must be made clear, and these components must support the mission and the new strategy.
  3. Deploy the right leaders and the right capabilities: Much of a reorganization’s success depends on a capable leader. The capable leader (one who can lead others well) must also be competent (one who understands what needs to be done). If the chosen leader does not have both leadership capability and technical competence, you are not likely to be successful.
  4. Design layer by layer, not just top-down: An approach that considers how the redesign will affect each level affected will be more successful than a change directed from the top. Inviting leaders at each level to participate in the redesign yields a success-to-failure rate of 4:1 (double the top-down) success rate. This is because such a thoughtful design achieves greater alignment and buy-in, blunting the negative effects of future uncertainty.
  5. De-risk execution: Reorganization must be carefully thought through, planned, and executed in a transparent system where a) everyone affected knows what is happening and b) where course corrections can be made in the process. A successful reorganization will never be a haphazard process. If it does, the efficiency gains on paper will be wiped out by demotivation and marked by departures (mental or physical).
  6. Don’t wait for a crisis to reorganize: Reorganizing because growth led to a dismal success-to-failure rate of 1:2, but reorganizations for the sake of organizational strategy, that were not driven by a crisis, had a much higher success rate (21:1) because the change was mission-driven and properly resourced. Unfortunately, only 10 percent of reorganizations take place during these periods of strength. The majority of reorganization efforts take place because things are not working well.

Screen Shot 2017-01-20 at 2.40.56 PM

The authors of the study concluded,

For organizations with only one success factor in place, the rate of success was 32 percent. But with each additional factor, the success rate jumped proportionately; 88 percent of organizations that had five or more elements in place reported complete success.[5]

If you are going through a reorganization, the good news is that you now have predictive power. Add up the factors to determine your odds.

  • Is it for a strategic purpose or is it because we do not know what else to do?
  • Are your new roles clear and connected to the mission or are they an afterthought based on the reorganization?
  • Is your new leader capable (to lead) and competent (technically)?
  • Were you invited into the redesign process or was it designed by the executives with little design input by those affected?
  • Is it being carefully executed with the ability to make course corrections as necessary?
  • Is it being done during the good times to enhance effectiveness based on organizational strategy or is it done in reaction to a crisis?

Add up your total. If you counted one factor, your odds of success are 32%. If two, your odds are 42%. If three, 55%. If four, 66%. If you have 5 or 6 factors, 88%. You now know your odds. The next question is what you will do with that information.

-Darin Gerdes

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[1] Gates, R. M. (2016). A passion for leadership: Lessons on change and reform from fifty years of public service. New York: Alfred A. Knopf (pp. 58-59).

[2] Townsend, R. (1970). Up the organization. New York: Knopf. (p. 111).

[3] Drucker, P. F. (1974). Management: Tasks, responsibilities, practices. New York: Routledge. (p. 464)

[4] Toma, A., Roghé, F., Noakes, B., Rainer, S., Kilmann, J., and Dicke, R. (2012, April 25). Flipping the odds on successful reorganization: Organization of the future: Designed to win. BCG Perspectives. Retrieved from https://www.bcgperspectives.com/content/articles/change_management_organization_design_flipping_the_odds_for_successful_reorganization/

[5] Flipping the odds on successful reorganization: Organization of the future: Designed to win. BCG Perspectives. Retrieved from https://www.bcgperspectives.com/content/articles/change_management_organization_design_flipping_the_odds_for_successful_reorganization/

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gerdes

Dr. Darin Gerdes is an Associate Professor of management in the School of Business at Charleston Southern University. All ideas expressed on www.daringerdes.com are his own.

This post was originally created for Great Business Networking (GBN), a networking organization for business professionals where Dr. Gerdes is the Director of Education.

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The Perspective of Time

“What if it turns out Rambo III was really good?”

-Paula Poundstone [1]

Last weekend I watched Rambo III for the first time. I was only 29 years late. I barely remember when it came out in 1988. It was kind of a dud. I clearly remember when Rambo: First Blood Part II came out in 1985. That movie captured the popular imagination.

Rambo III

If you missed it, this is the basic story: Something bad happened to someone behind enemy lines and Rambo goes in alone to fight an entire army to set the captive free. This was also what happened in the original Rambo too, but three decades later, we might see this movie through a different set of eyes.

Spoiler Alert

Here, I should offer a spoiler alert, but if you have not seen the movie over the past three decades, you are not likely to do so in the future. Nevertheless, if you are intent on seeing the movie, look away now.

So this is what happened: Rambo is minding his business in Thailand fixing up a Buddhist temple, finally finding peace. When a U.S. Embassy official informs him that his friend, Colonel Trautman has been taken captive by the Soviets, he decides to leave his newfound peace and return to his former life of killing lots of bad guys.

This time, the battlefield was in Afghanistan. The Afghan war was winding down when the movie was released in 1988. A year earlier, Gorbachev announced that he would start withdrawing Soviet forces.

In the movie, Colonel Trautman was sent to supply the Afghan Mujahideen with missiles to fight the Soviets who had occupied Afghanistan since the invasion in 1979. If you recall, the US boycotted the 1980 Olympics over this Soviet aggression.[2] Trautman is a fictional character, but the United States did supply the Mujahideen with stinger missiles in 1986.

Watching the movie in 2017 is remarkable. Because the Soviets are still the bad guys, the Mujahideen are depicted as sympathetic figures, simply fighting for the oppressed. When Rambo appeals to a tribe for help in rescuing his friend, a tribal leader explains:

My name is Masoud. You must not judge us, before you understand why we are not directed to help. Most of the Afghan people are very strong, and we are determined not to be driven from our land. Our children die of disease, mines, and poison gas. And our women are raped and killed. Last year, in the valley of Legman, the next valley, Pregnant women were cut with bayonets, and their babies thrown into the fire. This is done, so they will not have to fight the next generation of Afghans. Yet nobody sees anything, or reads anything in the papers. What you see here, are the Mujahedin soldiers, holy warriors. To us, this war is a holy war. And there is no true death for a Mujahedin, because we have taken our last nights, and because we consider us already dead. To us, death for our land and God is an honor.

After Rambo breaks Colonel Trautman out of prison, and they thought that they had escaped, they were surrounded by a huge Soviet army with tanks and helicopters. All appeared hopeless, but they were rescued by the Mujahideen, riding in on horseback like the cavalry in an old Western. They were the good guys because the Soviets were the bad guys and a number of important geopolitical events had not yet happened.

In real-life, the Mujahideen inflicted serious losses on the Soviets. Afghanistan was the Soviet Union’s Vietnam, but after expelling the Soviets, the Mujahideen went on to fight their own civil war, overthrow the Afghan government, and impose strict Wahabi Islamic sharia law (from which the Taliban emerged in 1994 as the victors).

Again, in real life, the Taliban were little better—and perhaps more oppressive—than their Soviet enemies. According to the U.S. State Department:

Prior to the rise of the Taliban, women in Afghanistan were protected under law and increasingly afforded rights in Afghan society.  Women received the right to vote in the 1920s; and as early as the 1960s, the Afghan constitution provided for equality for women. There was a mood of tolerance and openness as the country began moving toward democracy. Women were making important contributions to national development. In 1977, women comprised over 15% of Afghanistan’s highest legislative body. It is estimated that by the early 1990s, 70% of schoolteachers, 50% of government workers and university students, and 40% of doctors in Kabul were women. Afghan women had been active in humanitarian relief organizations until the Taliban imposed severe restrictions on their ability to work….

Afghanistan under the Taliban had one of the worst human rights records in the world. The regime systematically repressed all sectors of the population and denied even the most basic individual rights. Yet the Taliban’s war against women was particularly appalling.

Women are imprisoned in their homes, and are denied access to basic health care and education. Food sent to help starving people is stolen by their leaders. The religious monuments of other faiths are destroyed. Children are forbidden to fly kites, or sing songs… A girl of seven is beaten for wearing white shoes.
— President George W. Bush, Remarks to the Warsaw Conference on Combating Terrorism, November 6, 2001[3]

Ultimately, Osama Bin Laden found a hospitable environment for Al Quaeda (Literally “the base”) with the Mujahideen as early as 1987, the year before Rambo III was produced. Bin Laden and the Taliban regime mutually supported one another. We would become aware of all of this only after 9/11.

The Perspective of Time

They say that hindsight is 20/20. It might not be that clear, but in hindsight, some of the pro-Afghan messaging in the movie was a bit creepy. For instance, a local fighter explained to Rambo how Afghanistan had never been conquered:

This is Afghanistan. Alexander the Great tried to conquer this country, then Ghenghis Khan, then the British, now Russia. But Afghan people fight hard, they never be defeated. Ancient enemy make prayer about these people. Do you wish to hear? Very good. It says: “May God deliver us from the venom of the cobra, teeth of the tiger, and the vengeance of the Afghans.” Understand what this means?

Earlier, the U.S. Embassy official lectured Rambo:

I don’t know how much you know about Afghanistan. Most people can’t even find it on a map! But over two million civilians, mostly peasants farmers and their families, have been systematically slaughtered by invading Russian armies. Every new weapon, including chemical warfare, has been used to eliminate these people. And they’ve been very successful, at many levels. I assume that you’re out of touch with the current states of the war. But after nine years of fighting, the Afghan Forces are now getting their Stinger missiles, and are now beginning to hold their own against the Air-Strikes.

Later, Colonel Trautman tells his Soviet torturer:

Everyday, your war machines lose ground to a bunch of poorly armed,
poorly equipped freedom-fighters! The fact is that you underestimated your competition. If you studied your history, you’d know this people never gave up to anyone. They’d rather die than be slaves to an invading army.
You can’t defeat a people like that. We tried. We already had our Vietnam! Now you’re gonna have yours!

The movie was even dedicated “TO THE GALLANT PEOPLE OF AFGHANISTAN.”

dedication

At the end of the movie, one of the Mujahideen fighters invited Rambo to stay and in Afghanistan to continue to fight the Soviets:

“You’re sure you don’t want to stay? You fight good for a tourist!”

Rambo replied, “Maybe next time.”

I suppose if he did return, it would be after the 2001 U.S. invasion of Afghanistan, which might have been awkward since Rambo would have switched sides.

What is the Point?

I told you all of that to tell you this: Sylvester Stallone could not possibly have known what would transpire over the next few decades when he filmed the movie, but ironically, Rambo III led me to wax philosophical and reflect on life. You would expect that from the Matrix or Life is Beautiful, but not by Rambo III. But I walked away with two thoughts: What trends can’t I see now that will affect me in the next decade? And, What will I think when I look back at my life thirty years from now?

 

[1] Poundstone, P. (2009). Cats, cops, and stuff… [Video file]. Retrieved from https://www.youtube.com/watch?v=VLLP1Wtrg0U

[2] Carter announces Olympic boycott (n.d.). The History Channel. Retrieved from http://www.history.com/this-day-in-history/carter-announces-olympic-boycott

[3] The Taliban’s war against women (2001, November 17). U.S Department of State. Retrieved from https://www.state.gov/j/drl/rls/6185.htm

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gerdes

Dr. Darin Gerdes is an Associate Professor of management in the School of Business at Charleston Southern University. All ideas expressed on www.daringerdes.com are his own.

This post was originally created for Great Business Networking (GBN), a networking organization for business professionals where Dr. Gerdes is the Director of Education.

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THE New Year’s Resolution You Need to Make (forget the others)

I take New Year’s Resolutions seriously. I relish the fresh start and I often plan to do big things. Like most people, I fall short of accomplishing all of my goals, but after doing some research on goal setting this past year, I think I know why. I tried to do too much.

screen-shot-2017-01-02-at-12-47-18-pm

But this year, I think I have found a pathway to success. There are three parts to my strategy. First, everything I have read tells me to narrow my goals in order to achieve more.[i]

Second, I will improve just a little each day. It is the principle of Kaizen, a Japanese term for continual improvement. When I was working on my MBA in the mid 1990s, Total Quality Management was all the rage, and Kaizen was one of the concepts embedded in TQM.

Brian Tracy offered kaizen as the key to his 1000% formula. He asked if you could you increase your productivity by one-tenth of one percent (or one one-thousandth) per day. Sure you could. He went on to demonstrate that:

  • If you did that every day for 4 weeks, you would become 2% more productive in a month.
  • If you did that over a year, you would be 26% more productive.
  • If you continued this, each year for 10 years, you will be 1004% more productive in a decade.[ii]

What is important is not the math, but the disposition toward improvement. The goal-setting and time management research tells us that we should spend more time focused on fewer things in order to be successful. So I will choose fewer goals and I will work on incremental improvement on these goals, but how will I accomplish these productivity gains? The answer is systems.

So my one New Years Resolution is to be less efficient in the short-term by focusing my energy on the systems that help me achieve my most important goals. This was a concept I took from Rory Vaden. In his TEDx talk, How to Multiply Your Time, he explained that prioritization does nothing to create more time. By prioritizing, you shift attention from one priority to another. That may be helpful, but the most common solutions are still to do more things or do things faster. This leaves you running on a treadmill, overworked, and exhausted.

Instead, he recommend that you become a multiplier. Multipliers ask, “What can I do right now that would make the future better.” He added, “You MULTIPLY your time by giving yourself the EMOTIONAL PERMISSION to spend time on things TODAY that will give you more time TOMORROW.”[iii]

So for me, that is it. I have given myself the charge to build efficient systems to support the things that really matter. This will mean being less effective for a short period of time in order to be more effective overall.

What about you? What will you do? How will you make 2017 better than 2016? What systems can you install today that will give you leverage on tomorrow?
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gerdes

Dr. Darin Gerdes is an Associate Professor of management in the School of Business at Charleston Southern University. All ideas expressed on www.daringerdes.com are his own.

This post was originally created for Great Business Networking (GBN), a networking organization for business professionals where Dr. Gerdes is the Director of Education.

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[i] Babauta, L. (2009). The power of less: The fine art of limiting yourself to the essential– in business and in life. New York: Hyperion; McChesney, C., Covey, S., & Huling, J. (2012). The 4 disciplines of execution: Achieving your wildly important goals. New York: Free Press.

[ii] Tracy, B. (2008). Increasing your income 1000% formula. [Video file]. Retrieved from https://www.youtube.com/watch?v=6Pz03hNEVTE

[iii] Vaden, R. (2015). How to multiply your time. [Video file]. Retrieved from https://www.youtube.com/watch?v=y2X7c9TUQJ8&t=29s

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Adventures In Customers Service

I simply had to write about this. As a business professor, I just found it too fascinating not to talk about. Here is what happened.

It is the day after Christmas, and my wife asked me about where a Wal-Mart Site-to-store pick-up was. I hadn’t picked it up and neither had she, but we received a confirmation that it had already been picked-up. That was problem #1

#2. So I went to Wal-Mart and explained the problem to the people in the Site-to-store department. They looked it up by the account number and their information showed that it had been picked up.

#3. So I protested that it had not. Then I waited … and waited… and waited while they reviewed every receipt from customers with a last name that begins with a G. They found another site to store receipt, but not that one.

#4. The department manager tried to make it right. She made a call to correct it. She would reorder the missing merchandise and we would not be charged a second time.

#5. I believed her.

#6. When I returned home, my wife asked me why we were charged again for the same merchandise. What?

#7. So she attempted to cancel the order, but you cannot see if it is really canceled for a couple of days.

#8. I drove back to WalMart under the impression that I would resolve something. Silly me.

#9. I spoke with the same site to store department manager who understood the problem, but could not seem to get anyone elsewhere in Walmart’s system to tell her what happened. The best she could was get a half-hearted “I think the customer has not been charged a second time. I don’t know why it reflects that way on their email.”

10. I asked for assurances that we had not been charged twice for the same goods that we did not pick up the first time, but I received no reassurance. The department manager asked me if I would like to come back tomorrow. “No.” I wanted to resolve it now.

11. So she looked at her computer in the back room. She came back with no information.

12. “What do I do now?” I asked.  “You can see if your bank statements reflect a new charge,” she said. That really was not good enough.

13. “Well, we can go up to customer service.” So we walked up to customer service where a very annoyed assistant manager told me that I could come back tomorrow. In fairness, it was the day after Christmas, so I understand her annoyance, but I have now just spent a large chunk of my day in WalMart getting nowhere trying to resolve a problem that I did not create as they tried to correct a problem that I did not create.

It was dark when I left my local WalMart at 9800 Dorchester Road in Summerville, SC.  I resolved to write my story because I resolved to write the company president–the one that is in the new company commercials showing us how tuned in he is. Let’s see if he is tuned in or if that is marketing.

I wrote this:

Dear Doug,
I thought I would let you know about my experience at Wal-Mart today. I received a confirmation email for a site-to-store pick up that I did not pick up (but I was charged for). I went t0 the store and tried to resolve it. After waiting for the employees to scour the receipts, they told me that they would re-order it for me “at no charge” (which actually means that they would provide the merchandise that I already paid for, but OK. To err is human).

When I got home I found out that they had charged me a second time. We tried to cancel, but the system would not tell us that it was canceled. I drove back to the store and asked them to unwind the transaction. No one could tell if I was actually charged twice. They told me to check my bank statement to find out. Really?
I wasted hours of my day trying to correct a mistake compounded by additional mistakes that were made over and again by your employees. I would like to get this problem resolved, and I thought you would like to know just how badly your internal system is functioning. I would also like to know how I can get these few hours of my life back. I blogged about it here if you care to read about it:

-Darin Gerdes

I told him that I am looking forward to hearing back from him, but in the mean-time, I am blogging about it. I understand that companies now pay attention to social media, so we will test the theory.

The good news for WalMart is that they get to write the last segment of this post. I will provide their response below. If they do not respond, I will report that too. Either way, there is a public record and it will likely become a topic of discussion for class and maybe make its way into a future book.

So this is Part I. Stay tuned.

-Darin

 

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Free Universal Education is Not Free

When I was in college I remember thinking that it’s too bad that college is not free for anyone to attend. At the time, I didn’t understand just what I was saying. I was only looking at one side of the equation. I felt bad for those who did not have the financial resources to gain further education. Now, as a management professor, it’s easy to see the error in my thinking. In Economics in One Lesson, Henry Hazlitt explained that,

The art of economics consists of looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups. (emphasis added)[i]

Cap

I’d engaged in this one-sided error of only looking at the effect on one group. I only focused on the effect that free education would have on potential students. I hadn’t considered the effect on others. What if college were free? Without revenue from tuition, how long could it stay in business without paying employees? I am a professor. I have six kids and they like to eat. I would not work for free. Who would teach?

At this point, you might argue that universal college education could be paid for with tax dollars. Then I could be paid, my kids could eat, and students could attend for “free.” That sounds nice in theory, but as Milton Friedman observed, “there is no such thing as a free lunch.” By that, he meant that everything that is free for someone, college in this case, comes at a cost to someone else.

The Sanders campaign proposed free universal college education in 2016. They estimated the cost to be $75 billion annually.[ii] This item became a feature  of the 2016 Democratic Party Platform:

Making Debt-Free College a Reality Democrats believe that in America, if you want a higher education, you should always be able to get one: money should never stand in the way. Cost should not be a barrier to getting a degree or credential, and debt should not hold you back after you graduate. Bold new investments by the federal government, coupled with states reinvesting in higher education and colleges holding the line on costs, will ensure that Americans of all backgrounds will be prepared for the jobs and economy of the future. Democrats are unified in their strong belief that every student should be able to go to college debt-free, and working families should not have to pay any tuition to go to public colleges and universities (p. 30).

As a professor, I can assure you that anyone who has a high enough GPA and ACT score can get a free ride to college. If you know someone who you think qualifies, I will be happy to connect you with the admissions department at CSU. The reality in education is that the average students subsidize the really smart students with their tuition dollars. This means that average and weak students pay more for their education.

The decision to pay for everyone’s college education with significantly increased taxation is a political choice. But, if taxes are used to pay for “free” education, that same amount of money cannot be used for other things (perhaps things that you value more). If we think “free” is without cost, we run into another one-sided error. As I write, our national debt is approaching $20 trillion dollars and the debt must eventually be paid.

By the way, “free” college education is not new. When Governor Kaine was in office, I was a member of my local school board. I remember his P-16 plan at the school board convention. What is P-16? You are familiar with K-12 (kindergarten-12th grade). He wanted to expand this from pre-school to completion of college at taxpayer expense. It never happened because the Commonwealth of Virginia simply did not have the money.

Now the Democrats are proposing the same one-sided error writ large. Perhaps instead of asking why we are not funding college education (as if we have no heart), we might ask:

  • What we cannot do with the $75,000,000,000 they intend to spend annually.
  • At what point should a person take responsibility for his own education?
  • What new regulations will come attached to the “free” federal tuition?

Stop asking one-sided questions and trace the consequences of your actions for all groups involved.

-Darin Gerdes

[i] Hazlitt, H. (1946/1979). Economics in One Lesson. New York: Arlington House Publishers. (p. 17).

[ii] It’s Time to Make College Tuition free and Debt Free. (2016). BernieSanders.com Retrieved from https://berniesanders.com/issues/its-time-to-make-college-tuition-free-and-debt-free/

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gerdes

Dr. Darin Gerdes is an Associate Professor and Director of Graduate Programs in the School of Business at Charleston Southern University. All ideas expressed on www.daringerdes.com are his own.

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The Free Market

When I was in college, I was a bit of an idealist. In fact, I remember making a case for socialism to my parents in the car on the way to college. Mercifully, I attended Liberty University, where, as a government major, I was steeped in our constitutional history and free-market economics. I grew to appreciate the role of the free market in society.

I learned that government must be limited in order to allow the private sector the room that it needs to grow. In hindsight, I am not surprised that I returned to Liberty a decade after I graduated to teach in the School of Business. After all, business drives the economy.

Government is necessary to enforce the rules, but the private sector is responsible for economic growth. This, in turn, raises our standard of living. No mandate of any politician of any political party can mandate economic growth. Just imagine if the government tried to develop the iPhone.

Politicians can redistribute resources and they can create regulations that promote one industry at the expense of others, but they have yet to devise the law that mandates growth. They cannot expand the pie. They can only change the size of the pieces and who they choose to serve.

Set all of the rhetoric of the politicians aside. The only way politicians can create growth is indirectly—through policies that provide a conducive climate for business to take place. Set the theories of the Keynesian economists aside. Government spending does not create growth; it creates debt and you cannot spend your way out of debt.

Growth comes from productive activity in the market. Our standard of living is due to the millions of people that work hard every day to produce the goods and services that we need. As they compete, they innovate, and this innovation makes us smarter, better, and faster.

Think about how you watch television. It is a metaphor for business. In the 1980s, you had a handful of channels to choose from. Government gave us PBS, but private businesses gave us more channels than we have time to watch. They gave us cable, satellite, and high-speed internet TV. If you’re old enough, you remember a time when you had to be home at the right time to watch your favorite TV show. Businessmen fixed the problem first with the VCR, and then with the DVR. They did it because they listen to their customers and they did it for profit.

That is the power of the free Market.

-Darin Gerdes
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gerdes

Dr. Darin Gerdes is an Associate Professor and Director of Graduate Programs in the School of Business at Charleston Southern University. All ideas expressed on www.daringerdes.com are his own.

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This is Why You Should Not Try to Sell Everyone

PENNIES AND COINS

Imagine you are standing ankle-deep in coins. You have three seconds to pick up any coin that you want, and you can repeat this process as many times as you want, but you have to pay 10 cents every time you pick up a coin whether you come up with one or not (this is called the customer acquisition cost). You see many pennies and nickels. You see a number of dimes. You see a handful of quarters and a few half-dollars. The bigger pieces are harder to identify because they look very similar to worthless game tokens.

What would you pick up? The answer is obvious. You must pursue quarters and half-dollars. Anything else is nonsensical. If you pick up a dime, you only break even. If you pick up a nickel, you’ve destroyed half of the value of your original investment. If you pick up a penny, your return is only 1/10th of what you spent. You must make back at least that which you spent, or it would be better to just sit on your money. Unfortunately, many people conduct marketing efforts only thinking about what they gain without considering the cost.

-Darin
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Dr. Darin Gerdes is an Associate Professor and Director of Graduate Programs in the School of Business at Charleston Southern University. All ideas expressed on www.daringerdes.com are his own.

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Filed under Change, Motivation, Success