How - Dov Seidman [152]
Be Principled
In the wake of Hurricane Katrina and the destruction of the city of New Orleans, the U.S. Federal Emergency Management Agency (FEMA) handed out money to people in a helter-skelter fashion with almost no basic fraud-prevention systems. Emergency aid was subsequently used to purchase season tickets to the New Orleans Saints football games, a large dinner at a Hooters restaurant in San Antonio, a $200 bottle of Dom Pérignon, an all-inclusive weeklong Caribbean vacation, and several “Girls Gone Wild” videos. Thousands of incarcerated criminals received emergency housing allowances.12 “We just made the calculated decision that we were going to help as many people as we could,” said Donna Dannels, acting deputy director of recovery for FEMA, speaking to a Congressional oversight committee a year later, “and go back [later to] identify those people who we either paid in error or [who] defrauded us.”13 Dannels made this statement after a nonpartisan Government Accounting Office study revealed that as much as $1.4 billion—one-quarter of the total monies FEMA distributed in the wake of the disaster—was lost to fraud and abuse.
Decision making, in general, flows from one of two sources: pragmatism or principle. Pragmatic decisions seek to solve the immediate problem in the most expedient manner, like FEMA in the face of Katrina. Pragmatic thinking tends to embrace short-term benefits and alleviate immediate pain, but it produces unintended consequences with often long-term ramifications. If FEMA were a for-profit company, for instance, its losses from fraud would be dwarfed by the loss of its credibility and reputation. Who would choose to invest in an insurance company that reimbursed the purchase of “Girls Gone Wild” videos? What possible explanation can remediate the impression that choice leaves on the market?
In the course of a business day, we are all called upon to make countless decisions. If we are self-governing and adopt a leadership disposition, we make even more. What kind of spacecraft do we build? What should the design look like? What kind of people should we hire? What should I say when I return this phone call? Leaders are constantly making decisions, and a given team or organization might make hundreds, if not thousands, of decisions each day. If each one of us makes decisions based on short-term, pragmatic considerations—what will sound good, what will make the problem go away, what will close this deal—the errors of unintended consequences—like Girls Gone Wild—just spiral out of control. We can’t control or imagine the ramifications of all those short-term decisions.
What would happen, for instance, if, after a successful quarter of doing or saying whatever it took to make your numbers, you put all of your customers in a room and walked out. What would they think of you if they started to compare notes?
“Hmmm, they let you do a six-month pilot? They told me they don’t do pilots.”
“You got a three-year contract? They told me they would only do a five-year contract, no matter what.”
In a transparent, connected world, this happens every day, both physically and virtually. And not just about company practices, but about your individual behavior, as well. Comparing notes is cheap and easy, and we do it countless times a day via the vast store of information and communication technology easily at our fingertips. That puts a premium on consistency. The world of HOW calls for conduct that creates long-term, self-sustaining continuity, which builds trust and further