Winning - Jack Welch [10]
Nancy tells me that Kant had another point, too. He said that people are often strongly tempted not to be candid because they don’t look at the big picture. They worry that when they speak their minds and the news isn’t good, they stand a strong chance of alienating other people. But what they don’t see is that lack of candor is the ultimate form of alienation. “There was a huge irony in this for Kant,” Nancy says. “He believed that when people avoid candor in order to curry favor with other people, they actually destroy trust, and in that way, they ultimately erode society.”
I tell Nancy the same could be said about eroding business.
FROM THEN TO NOW
The make-or-break importance of candor in U.S. business is relatively new, actually. Up until the early 1980s, big companies like GE and thousands of others operated largely without it, as did most companies regardless of size. These companies were a product of the military-industrial complex that grew up after World War II. They had virtually no global competition, and, in fact, companies within industries were so similar to one another that they could often seem more collegial than competitive.
Take the steel industry. Every three years or so, union workers across several companies would demand higher pay and benefits. The steel companies would meet those demands, passing their increased costs on to the automotive industry, which would pass their increased costs on to the consumer.
It was a nice party until the Japanese arrived at the door with their average-quality, low-cost imported cars that within a few years became high-quality, low-cost cars, many of them made in nonunion U.S. factories.
But until the foreign threat spread, most American companies had very little to do with the kind of frank debate and fast action that characterizes a candid organization. They had little use for it. And so countless layers of bureaucracy and old-fashioned social codes of behavior led to a kind of enforced politeness and formality throughout most organizations. There were very few overt confrontations about strategy or values; decisions were made mostly behind closed doors. And when it came to appraisals, those too were conducted with a kind of courteous remoteness. Good performers were praised, but because companies were so financially strong, poor performers could be warehoused in a far-flung department or division until retirement.
Without candor, everyone saved face, and business lumbered along. The status quo was accepted. Fake behavior was just a day at the office. And people with initiative, gumption, and guts were labeled troublesome—or worse.
You would predict, perhaps, that given all its competitive advantages, candor would have made a grand entrance with the Japanese. But Japan didn’t make it happen, nor did Ireland, Mexico, India, or China, to name a few of the big hitters in the global marketplace today. Instead, most companies have fought global competition through more conventional means: layoffs, drastic cost reductions, and in the best cases, with innovation.
Candor, while inching its way in, still remains a very small part of the arsenal.
IT CAN BE DONE
Now for the really bad news. Even though candor is vital to winning, it is hard and time-consuming to instill in any group, no matter what size.
Hard because you are fighting human nature and entrenched organizational behaviors, and time-consuming, as in years and years. At GE, it took us close to a decade to use candor as a matter of course, and it was by no means universal after twenty.
Still it can be done. There is nothing scientific about the process. To get candor, you reward it, praise it, and talk about it. You make public heroes out of people who demonstrate it. Most of all, you yourself demonstrate it in an exuberant and even exaggerated way—even when you’re not the boss.
Imagine