Marketing Guru Shel Horowitz recently reviewed The 3 Power Values in his Clean and Green Newsletter
The 3 Power Values: How Commitment, Integrity, and Transparency Clear the Roadblocks to Performance, by David Gebler (Jossey-Bass, 2012)For more than 30 years, Johnson & Johnson has been the poster child for great handling of an ethics crisis. Their response to the Tylenol poisoning scare of 1982 is textbook-perfect: taking responsibility, being very public in its efforts to alert consumers to possible danger, recalling its entire line of products, and then redesigning its packaging so it could never happen again. Business school ethics classes commonly use this case study.
So it’s a shock that Gebler begins with a different J&J case study: a quality engineer’s boss threatens his job if he doesn’t allow a defective shipment of aspirin to go through. Gebler cites several other quality issues at J&J, though none so blatant as this—and notes that publicity around these issues was a likely culprit in market share for cough and cold remedies plunging from 17 percent all the way down to 2.83 (p.4)
What happened? Gebler believes it was a change in corporate culture during the 2000s: away from the Customer First credo that successfully guided the company through the Tylenol incident and helped it to regain profitability very quickly, and toward the high-pressure, cost-conscious attitude so typical of many corporations today, where doing the right thing—throwing out the bad batch of aspirin, in this case—is considered too expensive. Of course, the market share numbers show the foolishness of that approach. In a world where nothing stays secret very long, cost-cutting at the expense of quality is a path to disaster—and sometimes, a bunch of very expensive litigation or government-ordered penalties.
I’ve reviewed many books on business ethics in this column, but I don’t remember one that focuses so heavily on the impact of a corporate culture. It’s always mentioned, but in this book, it’s the core principle. Gebler focuses his argument on improving corporate ethics as well as productivity by focusing on the three values in the subtitle.
In his view, engaged employees who feel listened to and empowered—and who see at least some of their ideas and concerns implemented into the culture—are much more likely to be more productive, and much less likely to fall down the slippery slopes of corner-cutting or cheating.
The reverse is also true: when employees feel disempowered, unlistened to, and pressured to meet performance goals without regard to quality or ethics, companies become micromanaged fiefdoms mired in quicksand BECAUSE employees fall into dangerous patterns of individual and/or group “self-deception, rationalization of inappropriate behavior, and disengagement.” Individual creativity and motivation dry up if managers don’t nurture them by hearing and ACTING ON their employees contributions—and by creating a culture where profit and success are not seen as direct goals, but as results of a positive outlook that empowers and rewards employees to do the right thing.
But when employees CAN live their values and feel good about the work they do and the company they do it for, amazing things can happen. Often, that involves getting employees whose job descriptions put them at cross purposes out of their silos and building relationships in person—or at least taking the time to understand the other’s job, the pressures they face, and the tension between a salesperson’s promises to a customer and a quality manager or parts supplier’s need to ensure quality and legality.
A lot of this happens when employees feel the culture is fair. Arbitrary rewards and punishments create a fragmented and resentful culture straight out of Dilbert. But when employees feel the same rules apply to everyone, and when bosses are involved and not isolated, the company is seen as a great place to work, and people work hard to give their best: “Every employee must be able to answer the same question: Can I align my principles with the organization’s standards of behavior?” (p. 152)
The transparency issue is a bit different from commitment and integrity, in that it’s much more externally focused: in a world of massive social media connections and instant communication, there are no secrets. Sooner or later, the word gets out, and if you’re lying or cheating, you will face consequences.
These arguments will not come as a surprise if you’ve read either of my two books on ethics and green principles as success strategies, or if you’ve been following this book review column for a while—but phrasing it in terms of the impact of corporate culture is a bit of a departure.
Gebler’s case studies include a mix of companies that were very much in the public eye, like Johnson & Johnson and Boeing, both of which had to turn around big, public problems, and Timberland, whose built-in culture of ethics led to an immediate and public reexamination of its leather sourcing after Greenpeace questioned it—as well as some of his corporate clients facing ethics and motivation issues, with names disguised. The book is unnecessarily repetitive, but makes a lot of good points.