What’s your Clause IV?

Just been re-reading parts of Tony Blair’s autobiography.

Love him or loathe him, he was an exceptionally skilled agent of change. Within his party at least.

Blair took a massive gamble early in his leadership on campaigning to abolish Clause IV, a redundant Labour credo dating back to 1917 which called, amongst other things, for “the common ownership of the means of production, distribution and exchange” and was hence incompatible with any embrace of the free market.

In Blair’s words:

“It was largely symbolic. No one except the far left ever really believed in Clause IV as it was written. In a sense that was my point: no-one believed in it, yet no-one dared remove it. What this symbolised, therefore, was not just something redundant in our constitution, but a refusal to  confront reality, to change profoundly, to embrace the modern world wholeheartedly. In other words, this symbol mattered. It was a graven image, an idol. Breaking it would also change the psychology in the party that was damaging and reactionary and which was precisely what had kept us in Opposition for long periods.”

The gamble paid off and, as Blair writes, “the battle over Clause IV more or less set the scene for the style and content of leadership in the years up to 1997” (when he became PM).

So my thought for other leaders is this:

What’s your Clause IV?

What outdated practice or belief within your organisation has the potential to be both a real and a symbolic platform for change. And can you take a leaf out of Tony’s book to tackle it head on?

Executive Pay

Most people would agree that something has gone wrong with the levels of pay enjoyed by senior executives. Certainly, it would seem that the remuneration for top people is not in line with public sentiment. Anyone who has ever been to the annual shareholders meeting of a large business will know just how vexed an issue it is. They do, of course, get a vote. The floor of the meeting unanimously votes against the directors pay resolution only to see that the, often absent, institutional shareholders have already voted in favour. So, where did it all go wrong and does it actually matter.

Ironically, it all went wrong for the right reasons. Institutional shareholders wanted to encourage two things in company leaders: shared ownership (called, rather unpleasantly, ‘skin in the game’) and long-term thinking. This is now the root of the real problem. Of course, the six figure basic packages are too high relative to the average employee, but it is the share scheme packages that create the real disparity, resulting in multi-million payouts over a number of years.

So why is pay so high? There are three main reasons, two of which are based on myths. Firstly, that there is a global market for leaders. The evidence would suggest that most people live and work in their home countries. There is, and always has been a small cadre of international CEOs, but most aren’t. It reminds me of the great Sir Thomas Beecham who once said “Why do we have to have all these third-rate foreign conductors around when we have so many second-rate ones of our own?”

The second myth is that leaders are special people who have unique skills that are transferable across both companies, countries and sectors. Well, I’ll leave you to ponder on that. But on the whole the solutions to issues and the people to solve them already exist in most organisations. Therefore, it is more effective and sustainable to create the climate in which change can flourish from within rather than in parachuting in superstars from outside.

The third reason why pay is so high is because of the rather incestuous relationship between remuneration committees aided and abetted by pay consultancies. Some business journalists in the past have mapped the network of who sits on whose board. The result has been an arms race of back-scratching where the down side of failure is irrelevant to people who have already built up multi-million shareholdings and pension funds.

But does any of this matter beyond a general feeling of unfairness? Well, it does serve to underline why the levels of trust towards leaders is so low and why so few employees actually listen to what their leaders are saying. Clearly whatever leaders say to their employees, they’re not all in it together. This is never more important than during times of change when the disproportionate nature of risk and reward is at is most acute.

And what to do about it? Well, as the old joke goes, I wouldn’t start from here.

“Social Media Will Replace Business Websites”

“Social Media Will Replace Business Websites”

This was the headline to a recent story in Forbes.com. A reader followed up by asking: “If this is really going to happen, how will it affect the practice of change management /organizational development?”

Here’s what I replied:

Whereas it is true that nothing lasts for ever, it is also the case that rumours of the death of any channel tend to be wildly exaggerated. Just as the DVD hasn’t killed off the cinema, which in turn hasn’t killed off the theatre, so too is there a place for every communication channel. It is, as with most things, a question of what is the most appropriate in any given context.

With regard to company websites, they are continuing to evolve from basically electronic brochures to interactive sites that can be used both for sales generation and as a media channel. Where they are becoming less successful, however, is for conversations. People are leaving web sites and gravitating either to web space (such as Facebook) or to similar special-interest groups where discussions are focused on specific topics.

And to answer your question specifically, what it means for change management and organisational development is that people will use social media techniques and tools (whether or not they have been sanctioned by senior management) to share information and collaborate on ideas.The result will be a new workplace paradigm based on flatter, non-hierarchical structures where status is less apparent. Today’s citizen is typically a sophisticated user of technology. Just as they are using such tools to topple undemocratic regimes they may soon use them to impact behaviour within traditional command and control businesses. It could be the start of a real workplace revolution.

Well. What do you think?

Trust, privacy, and control

The twitterisation of society continues apace. US covert action and super-injunctions have found themselves outed on the ubiquitous chatter blog. There seems no escape from it. Indeed, many of you will have come to this blog via that channel. It all seems very new, as if the foundations of traditional communications are being rocked. The reality is that society has always been pretty prurient, on the one hand, whilst on the other, many people have had plenty of reasons to want to keep certain things secret. There’s always been gossip, and there’s always been a need for privacy. In reality, I’m not sure that there is an answer that satisfies all parties. I certainly have no definitive view point. Actually, I’m quite enjoying watching the doyens of the media, legal profession and the blogosphere arguing the equivalent of the number of angels that can fit on a pin head.

Now I’m not intending to belittle the real harm that can be done to individuals and their families from private matters becoming public. Nor am under-estimating the real value that can come from transparency. But I do believe that it is all about context. I think that many people are looking at this matter from the wrong angle. It is a fact that the number of injunctions (super or otherwise) is pretty small. On the other hand the benefits of sharing information, of encouraging dialogue, and of collaborating and co-creating, whether by blog, micro-blogs or “traditional” methods is something so beneficial to society that we mustn’t throw the baby out with the bath water.

The prurient will always be with us. But in the end rather than focus on negative issues such as the shenanigans of here-today-gone-tomorrow sports stars we would be better served by talking about how to use new channels to encourage real dialogue that can help shape our society for the better.

Change and the art of golf part ll

After two weeks of hitting balls at the driving range, it became very clear that all was not well. Short irons were pretty good but long irons were frankly rubbish. And as for the big woods? Well, I simply couldn’t hit them for toffee. So I signed up for a lesson. What became clear was that my grip, and consequently my swing, were incorrect. My timing, eye for the ball and strength were excellent and so with the short clubs I was able to compensate for my bad grip and get the balls away. But with the longer clubs I had no chance. I now have to re-learn a completely new way of holding and swinging a golf club. And I’ve learnt two big lessons:

Firstly, change isn’t easy. Doing things differently goes against every instinct (and muscle). The body and mind fight against any imposed change and constantly try and revert to the familiar however wrong it knows it to be. Real change requires practice, a vision of the future and commitment.

Secondly, I rather belatedly realised that it often requires outside help to make the change effective. I was put off by the cost of the lesson (a false economy) and because I thought that I had all the answers. Indeed, I thought that perseverance would be enough. In fact, I was persevering in the wrong direction. Sometimes we need to listen to outside advice. Sometimes we need to accept that experts can bring wide experience to a situation. And sometimes we need to realise that we are blind to those things in front of us but that outsiders can see issues with greater clarity. It is not always a case of physician heal thyself. Second opinions are important.

Now it is back to the range, but this time with the knowledge that what feels wrong is in fact right.