Last week I wrote about the lessons learned from General Shinseki’s resignation as Secretary of the VA,including opening communications avenues to people several steps below you, and staying ahead of the problems by talking to a wider group of people with different perspectives. That column generated a lot of responses. (Thank you to everyone who wrote.) Most people commented on the craziness of developing incentive programs that backfire and provide incentives for falsifying records instead of a greater commitment to meeting goals. The law of unintended consequences was apparently not considered.
One of the other lessons was about organizational culture, and if I may quote myself:
“ . . . create a culture that makes hiding information or falsifying it absolutely unacceptable. . . . People are only so immune to temptation or pressure. Basing bonuses on a system that ensures failure will push some people to do unethical things.”
A similar failure of corporate culture was discussed in the business section of Sunday’s New York Times, and asks how Mary Barra, the new General Motors CEO, could possibly change a culture where everyone who knew how to fix the faulty ignition switches did nothing, and no one was held accountable. The fix was both easy and cheap, but although it was identified early, it was not implemented. The general feeling is that the company put profits above everything else.
In particular, the people who either vetoed the changes or postponed the decision were never identified because no records were kept and, therefore, they couldn’t be held accountable. “Such a practice seems intended to avoid accountability.” Some people reported that the GM attorneys didn’t seem to want to have things in writing, that is, documented.
In addition, specific non-verbal behaviors developed that were called the “the GM salute” and the “GM nod” that supported the agreement to deny responsibility and accountability. The salute was a way of crossing your arms and pointing a finger indicating something was someone else’s responsibility, and the nod indicated that everyone agreed on a procedure or process, and also agreed that no one would follow through. Giving behaviors names indicates that they are so ingrained in the culture that everyone understands them. Not following those non-verbal agreements can cost you your job even if your good sense and ethical standards scream at you to do something else.
The NYT columnist, Gretchen Morgenson, mentions that a similar lack of accountability exists in the financial services industry. For all the illegal activity, no one at the top has been held accountable, even though much lower-level employees have been fired (as some at GM have been fired).
In the end, the problem is lack of consequences for egregiously bad behavior. The big banks are being fined what amounts to “chump change” for them, and most senior executives still have their jobs. Mary Barra of GM wants to instill a “culture of integrity,” but how is she to do that when the people responsible for the situation can’t even be identified?
The military fires the most senior person when a problem has been mishandled, and that is what happened to General Shinseki. If it happened on your watch, you are responsible, so General Shinseki had to go. In GM’s case, the people responsible can’t be identified, but Morgenson has a suggestion for consequences, and she states it better than I can summarize it:
“Why not force every one of the people who ignored the ignition switch problem, every member of all those committees that met and did nothing over the years, to meet with the families of the G.M. customers who died driving the faulty cars. Each one of these executives should experience, if only for a few moments, the trauma their indifference unleashed on these families.”
Accepting the impact of your actions and the consequences of your behavior is called Restorative Justice in conflict resolution circles, and these meetings change people. Among young adults, victim-offender meetings reduce recidivism by as much as 95%. Families who have lost loved ones to murder are sometimes meeting with the murderers who want to apologize. It’s a small but important step, and the people who have to meet face-to-face with the people who have lost loved ones never forget that their actions have real consequences.
In this case there may never be “justice” in ways we understand it, but forcing the people involved to face the consequences of their acts and understand the reality of their failure just might change the GM culture to one of integrity, as Barra hopes. Facing the consequences might work in our organizations as well, if we have the courage and the integrity to insist upon it.