The Ethics of Honesty

As most regular readers of this blog (assuming I have readers) already know, I spent a number of years as a management consultant, working with small and medium-size organizations, both for-profit and non-profit, and helping new ventures to launch and existing firms to get better at whatever they were doing. Unfortunately, most people have no idea what that actually means. Even with the best of intentions, some people can’t seem to grasp that writing is different from typing, that operational analysis involves an in-depth examination of a firm’s activities and comparison to the rest of their industry, or that what I do requires years of experience and training. As a result, a lot of people apparently believe that I can take a brief look at what they are working on and somehow just know whether their idea will work, and what efforts will be required to make that happen, without any particular effort. Although it would seem that some of them also believe that the same functions could be handled by any bum from off the street – or a particularly bright two-year-old…

It’s a peculiar situation, in which people who would never consider asking for a free ride from a taxi driver or a free cake from a baker, or even for free legal advice from a lawyer, will assume that despite the fact that they have not the slightest idea what I do, it must be easy (and require no time at all). From time to time someone will call me up and ask me to read over their plans for a new venture of some kind and tell them what I think of the project, assuring me that this will “just take a minute” and that no one else can help them with it. The question at this point isn’t so much whether or not I should do it (I really shouldn’t, but no one is going to understand that, either), as it is what do I tell them. This is especially true when the concept I’m looking at is so deeply flawed that I can see multiple ways in which it could get the idea person behind it divorced, savagely beaten, publicly ridiculed, or completed bankrupted if they even admit to originating the idea…

On the one hand, I’m not actually the world’s expert on anything. I’m a competent, capable analyst with a lot of experience both operational and consulting in a wide range of industries, but that hardly makes me the final authority on every conceivable type of new venture. If I give a valuable idea a hearty thumbs-down there’s a real chance my “client” could give up on something that could make the world a better place. On the other hand, five years with a consulting firm, two more with the Small Business Administration (through the Small Business Development Centers program) and several additional years freelance, not to mention two Master’s Degrees in Business and 20 years in Corporate America means that I’m not exactly Captain Kangaroo, either. If an idea is flawed enough that I can spot major problems with it in a cursory reading, that probably means that it needs further development before the entrepreneur proceeds with his or her business plan. The issue then becomes, what do I tell them?

An idea that someone has nurtured for years is a deeply personal thing. Frequently, it’s the one brilliant idea that they are sure will catapult them to the big time without needing any of the tedious intervening steps; their generation’s answer to Microsoft Windows, or Facebook, or sliced bread. In other cases, it’s their personal vision of a better world to come; the Utopia that could exist if only people were willing to let go of their blindness and pre-conceived notions and listen. In either case, crushing that person’s hopes and dreams seems heartless – except when we consider that aforementioned divorce, ruin, grievous bodily injury and/or public humiliation, in which case failing to point out those critical flaws would be far worse…

So you tell me: what is the ethical choice here, for me – or any other management professional in an analogous situation? Should we fulfill our obligation to the client as we would with any other customer and tell them the bald truth, even though they are friends and/or family and our answer will have difficult emotional freighting? Should we refuse to take any case with a personal connection, the way a doctor or a lawyer might, knowing that our friend/relative would never be able to afford a professional analyst of reasonable quality, and our refusal could doom the project right off the bat? Should we try to divert the client into additional research and/or development when we know their idea will never fly and there is next to no chance they can find a fix for any of its problems? Do we attempt to point them toward existing ventures that already do something of this kind – assuming such ventures exist? Or do we tell the truth, the whole truth, openly and clearly, and let the chips fall where they may?

It’s worth thinking about…

Missed Their Calling

From time to time I will encounter a story wherein one of the principals has clearly chosen the wrong profession; however proficient he or she may have become, it is clear from the nature of the account, if not from the subject’s own remarks or actions, that he or she would be far more successful in another endeavor. This isn’t really surprising, when you think about it; most people grow and change as their careers develop, and very few of us are fortunate enough to have a true vocation that will occupy us for all of our lives. Where this becomes tragic is when an individual has spent decades in a career that does not suit them, and has been miserable the whole time, or where an individual is attempting to influence others with his or her expertise while failing to grasp that said expertise is inferior to that of an ordinary schoolchild…

The recent comments of some of the Tea Party operatives calling for small businesses in America to refuse to hire anyone in order to harm President Obama’s job creation initiatives (and his chances for re-election next year) struck me as falling into this category. I don’t pretend to know that much about politics, and no one would describe me as a demagogue, capable of swaying the masses or leading even a very small percentage of the electorate to the opinion I want them to have. But I know a fair amount about starting, developing, and managing a small business, and it struck me that Melissa Brookstone of the Tea Party Nation should probably stick to politics, because this whole idea is just silly from a business standpoint…

Consider, for a moment that no paid position in any business should exist unless the company has an active need for whatever function the employee is supposed to fulfill. If a given business has no need for a groundskeeper or a wine steward, for example, then it shouldn’t employ one. By the same token, if a given company has a need for a specific position, that means that it is losing money for every day that position is open – either because that position is not generating revenue through production, or because that position is not preventing the loss of revenue through efficient operations. If we remove all extraneous considerations and simply consider the business implications, then the suggestion that a business leave any position open, or fail to create new positions that are needed, is preposterous. Taken to its logical conclusion, such a suggestion will ultimately destroy the company in order to achieve the goals of the person or persons making it…

Now, I don’t mean to suggest that the Tea Party Nation (or the larger Tea Party movement that it alleges to speak for) are hostile to small business in America and want to see it destroyed; such a suggestion would be inflammatory as well as unsupported by the evidence. On the strength of the Chicago Tribune story from which I learned of this call to action it would appear that Ms. Brookstone simply regards the removal from public office of the current President, the majority of both houses of Congress, and indeed, everyone else with whom she disagrees as being more important than the lives and livelihood of everyone associated with small business in America. And, indeed, from her political and ideological point of view, this may seem reasonable; I am no expert on political viewpoints, let alone far-right extremist viewpoints. I merely observe that from the standpoint of a business teacher and management consultant, this is lunacy, plain and simple…

The American author and humorist James Thurber once noted, as the moral to one of his modernistic fables, that “You can’t be King of the Beasts if there aren’t any.” Even if we accept, for the sake of argument, that everything advanced by the Tea Party about the current administration is correct, that still does not explain how crippling every small business in America and thereby destroying our economy and bringing about the personal ruin of tens of millions of people will save us from the horrors of socialism and/or communism – assuming that socialism and/or communism have horrors associated with them in the first place. I can only suggest that Ms. Brookstone and the Tea Party stick to politics – because they would appear to be terrible business consultants…

The Disney Institute

Last summer my family and I took a trip to Disneyland, and I wrote about it in this space in a post I called “We’re Not Worthy!” As I noted at the time, going to Disneyland when you’re a management scientist is a lot like going to visit a cutting-edge NASA facility if you’re a physicist: you spend most of your time wandering around staring at things and muttering “These guys are GOOD!” under your breath. And, in fairness, they are; the heart of any Disney park is essentially one huge tie-in product to dozens of motion pictures and cartoons, some of them decades old, with some of the best marketing (best in terms of dollars made per dollar spent) and merchandising the world has ever seen. Until your business can convince your customers to pay you 500% markups on food, shell out 800% markups on souvenirs, and wait for up to 3 hours to go on a five-minute ride, don’t even think of embarrassing yourself by comparing your business to a Disney theme park.

But as impressive as all of that is, there’s a new Disney venture that leaves all of those achievements in the dust. It’s a consulting/professional and corporate training operation called The Disney Institute. The basic concept is simple: since Disney management techniques are obviously so superior, every other business should want to study how they do things and apply these Disney techniques to their own operations. For a very reasonable price, Disney will sent a team of their own management scientists to your company to teach you how they do things, and to consult with you about how to apply these Disney principles to your own operational issues. An article in this morning’s Los Angeles Times details just such a training program going on at the Miami International Airport, which could definitely use some help with customer satisfaction issues (it consistently rates as the least favorite U.S. airport)

“So, what is so impressive about all of this?” I hear some of you asking. Granted that Disney has some really good management techniques, isn’t it simply logical that they would form their own consulting division and offer to teach them to you – for a price? Well, I suppose that on the face of it this is a very simple idea – which fails to explain why there is no comparable operation being run by any other successful corporation. IBM will not offer to teach you how to duplicate their tech support, Nordstrom will not come to your headquarters and teach you about customer service, and Apple is not about to share their thoughts about product design or marketing with you. Although any of these companies probably could develop a consulting/training division if they really wanted to. Certainly, they all have the necessary reputation for excellence in their respective fields.

Which brings me to the whole point about the Disney Institute. The Disney people have, in effect, applied their reputation for management and marketing excellence to a new service – in other words, they have expanded their existing brand to cover an entirely new line of services. All of the information they are offering to share with you has been divulged to the general public numerous times over the years; in documentaries, in Harvard Business School case studies, in management textbooks, even in existing Disney products. Any half-baked MBA student could explain the bulk of the Disney management techniques to you, and any reasonably good management consultant could explain to you how to apply these ideas to your business. But because the Disney brand name is so strong, people are willing to pay a premium to have genuine Disney personnel come and fulfill these same functions. Once again, the ingenious part isn’t what they’re doing, any more than a cheap plastic trinket with a Disney character printed on it is a great value; the ingenious part is that they’ve successfully marketed it to their customers at that preposterously high markup…

Say it will me, everyone: “We’re not worthy! We’re not worthy!”