What management lessons can be learned from the efforts of Ted Cruz and Mike Lee?
Most would say that the Republicans gained nothing, that they wrestled with a pig in the mud for three weeks and all they got was muddy and a happy Democrat pig.
Maybe. I’m not so sure.
I think it is too early to determine the definition of the outcome – because a lot depends on where they go from here.
My background is in business – more specifically in improvements in under-performing businesses and rapid turnarounds in businesses that are past the under-performing stages and are in survival mode. At this point in my 30+ year career, I have a 100% success rate in companies ranging in annual revenue from $5 million to over $150 million. I have experienced a range of timelines for turnarounds, in those were a company was generating results acceptable to the ownership, there was less pressure – but those in survival mode required immediate action to stop the bleeding. There was one thing that was common to each of these situations, that was the need for rapid culture change.
Culture change is hard – and rapid changes are exponentially more difficult. In all of the turnarounds that I have managed, I have created a bespoke model based on a process described by Price Pritchett, the founder of the Dallas based change management consulting firm, Pritchett, LP. Pritchett and co-author Ron Pound expounded on this process in their book, High-Velocity Culture Change.
In all of these situations, regardless of the patience of the owners or corporate headquarters, I have always believed in this quote from the book:
“There are various reasons for a high-velocity approach to culture change. There are no valid arguments for going slowly.”
Time is the one asset that, once spent, can never be recovered. The passage of time is your enemy, as is the entrenched culture:
“Setting out to change the culture is like taking on an army of secret police. You know the enemy is everywhere, ready to crack down on the people who don’t conform. Cold-blooded and forever watchful, culture cannot tolerate the unconventional.”
In observing the current situation in the ranks of the the US Congress, I thought about these quotes from the book:
“Watching a corporate culture change is like walking through a war zone. You see misery. Wreckage. Trauma.”
“Morale craters. Attitudes sour. Trust evaporates quicker than an early morning fog. Stress levels hit all-time highs.”
On the actions of Ted Cruz and Mike Lee:
“The right kinds of moves are guaranteed to cause stiff opposition. Your popularity rating will go into free fall.”
On what to do going forward if we really want change:
“Give your best people the big jobs. As for the others…reassign them. Fire them. Or neutralize them somehow. Remember that money is power. The more you make your adversaries dependent on you for funding their financial needs, the more you gain control.”
In the early 2000’s, I went into a company filled with bright, energetic people -but one that had suffered through 10 years of horrible performance – 8 years of significant losses in interspersed with 2 barely profitable years. They had been the victims of “turnarounds” that included alternating authoritarian and confused leadership that had robbed them of the idea that they could actually win. They had given in to the idea that success was out of their grasp, that the market was just not going to let them win. I spent a year simplifying the business and the business metrics so that the people felt that they had internal control and then set out on a long term plan to start winning. Each victory built confidence and it only took 13 months until we entered sustained profitability – I stayed with the business for 5 more years and and the momentum continued to build to the point that they have had 12 consecutive profitable years. The secret: we taught the business that it could win.
What that experience taught me is that if you want change, you have to create it. It does not happen by itself, entropy doesn’t generate enough movement. Even then, sometimes you have to give the status quo a hard shock. Having done this in a dozen or so organizations, I can tell you from personal experience that initiating change, shutting down business units, firing people, asking people to take on different (most of the time lesser roles) is hard. It hurts the soul to have to cut people – people who have families to feed and bills to pay. I have never done this easily, cavalierly or without it being the last option and I have never asked anyone to make that decision but me – for a team to function effectively, they can’t be burdened with guilt over making these changes.
But it is it not better to save the business and give those who remain a fighting chance?
Doing a turn-around takes very few skills other than an ability to recognize problems, quickly assess the people who will be in the canoe with you as your team, speak honestly and directly about everything, have a bias for action (never delay a decision – better to be strong and wrong than weak and right), an ability to create stability in an ambiguous world…and the courage to pull the pin on the grenade to start the change.
The way to solve big, complex problems is to constantly test solutions and directions – if anybody ever tells you that they had a solid plan that never changed during a turn-around, they are lying – fire them immediately. The most dynamic situation you will ever face is when everything is going wrong and nothing works. There is no instruction manual for that. You have to make decisions and try them out – if they are wrong, you will know soon enough to change course. The key is building a sustained momentum – keep moving forward no matter what. It may not be in a straight line, most likely it won’t be, but motion equals survival – stasis equals death.
This is where we are in our government. The Republican leadership is failing, even as the Democrats fail at almost everything, especially their big “achievements”. Obama and his team are failing because they have refused to change after their ideas didn’t work – the Obamacare rollout is a perfect example. Now they are telling America that the solution is more taxes, more borrowing and more intervention – in essence, they want us to paddle harder. Just trust them, they ask – they just aren’t quite through fixing things yet.
As many observers have pointed out, there are no rational people who think that the current levels of borrowing and taxation can cure our ills. There are only those, many exposed in these most recent government shutdowns, who simply want to delay the financial Armageddon until someone else’s term. The fact is that there are enough fatal structural defects in the approach to the US governance model that just working harder and spending more cannot fix it. Structural defects cannot be overcome with performance.
I’ve seen it all before in companies who were burning themselves out and wasting their resources by paddling harder against a current that was too powerful…and never recognizing that rescue was only a course change away. Simply paddling harder won’t do it, especially when government has been taking paddles away from some through taxation and regulation and pulling some 47% of tax filers completely out of the canoe. This will not get fixed without pain. The US needs to get ready for it. No amount of avoidance will forestall the inevitable crash – we have to make sure that it is only a hard landing. Something will have to be sacrificed to save the whole; I have little doubt about that. Everything can’t be given to everybody – there never was going to be a unicorn in every garage.
What the American government has just done – kicking the can down the road – is exactly what will produce disaster…and why this management team (including the reluctant Republicans) can’t be given more time. Time to cut the losses, bring in some true fixers and let them get it done. Ted Cruz and Mike Lee might not be those people but they have given Americans an inflection point to do just that…and in recent polls, up to 78% of Americans want to toss the whole bunch out and start over. That is the value of what they have just done, now it is up to America to take advantage of it.