President Trump, viewed as a CEO, part 2

President Trump CEO, part 2: Leading the Top Team

 

This is part 2 in a series on President Trump viewed through the lens of being a CEO. Part of President Trump’s great appeal is that he’s perceived as a successful businessperson. He’s even been talked about as being a President with CEO experience.

My article on the duties, responsibilities, and job description of a CEO, lays out four inherent parts of a CEO’s job. These are the parts of the job that, by definition, make a CEO a CEO. The CEO can delegate some things, but others simply can’t be delegated. Leading the top team is the CEO’s second main duty.

In the case of the President, the top team means the Cabinet. Most CEOs don’t immediately replace the top team of a company without seeking to understand something about who’s best for the job. Not so, the President. The President replaces the Cabinet immediately.

Hiring

Most people talk about elections as if it’s a middle school popularity contest. “My candidate won! Neener, neener, neener.” “My candidate lost, I hate you forever!!!” Let me be tasteful and diplomatic in saying that this is idiotic beyond belief (trust me, you don’t want to hear the non-diplomatic version).

Elections are a job interview. We may not like the slate of candidates we’re given, but they’re the candidates we have, and we have to choose one to fill the job.

I’ve heard it said that Trump was elected on the “pass it down” theory of competence: he doesn’t have to have great solutions, he just has to put the right people in place who have solutions.

Has he done that?

From his Cabinet picks, I don’t believe so. When hiring for a job, you generally look for relevant past experience, or a highly transferable skill set (e.g. general management).

A Cabinet pick oversees a multibillion-dollar organization. Not necessarily a business, an organization. Governmental bottom lines aren’t measured in dollars, but in civic terms.

Several appointees don’t necessarily know the playing field of the post they’ve been appointed to. That means that if they can get up to speed in any meaningful way, they have the same learning curve as someone just entering the field. I’m not sure that hiring candidates with the equivalent experience of a new college grad is the way to go.

In short, viewed solely through the lens of hiring the right person for the right job, it appears to me that Trump is not doing a good job.

Leading the team

Once he’s hired the team, he has to lead them. It’s too early to tell how he’ll do in that regard. Stay tuned.

Summary

Trump has appointed a top team whose qualifications for their specific roles are seriously in doubts. Many of his picks have no background in the areas they’ve been chosen to lead, no established reputations and connections in those areas, and no evidence in their backgrounds that they’ve managed similar efforts.

If I were an investor in a company whose CEO had just made these picks for leaders of the company, I would sell my stock.

UPDATE Jan 27, 2017: The entire senior administrative staff of the State Department just resigned. Good CEOs put proper succession planning in place for themselves, and understand the need for orderly transitions to keep things from spiraling out of control. Most institutional memory resides in the employees, not in the policies and procedures manuals. I’m extremely puzzled as to why Trump would allow something like this to happen, and not work harder to keep his senior team. This is a troublesome development, to say the least.

 

Part 3 of President Trump CEO, continued…

President Trump, viewed as a CEO, part 1

President Trump, viewed as a CEO, part 1

President Trump CEO, part 1: Setting Strategy

 

Part of President Trump’s great appeal is that he’s perceived as a successful businessperson. He’s even been talked about as being a President with CEO experience.

My article on the duties, responsibilities, and job description of a CEO, lays out four inherent parts of a CEO’s job. These are the parts of the job that, by definition, make a CEO a CEO. The CEO can delegate some things, but others simply can’t be delegated. Setting strategy is one of a CEO’s main duties.

Setting strategy

The CEO ultimately sets the strategy for a company. For a company, that means external, competitive strategy (how do we win in the marketplace against competitors) and internal strategy—how do we best use our internal resources in pursuit of success.

Strategic decisions generally have huge implications for a company or country. They involve moving time, effort, and money from one set of goals to another. They usually represent a multi-year commitment, whose effects won’t be seen until substantial investment is made. So strategic decisions are usually given a lot of thought and analysis.

Unlike businesses, countries don’t use economics as the only measuring stick. The goal isn’t to win against the competition. The goal is to provide a safe environment for the life, liberty, and pursuit of happiness of the residents. The outward-looking strategy certainly has economic components (e.g. tariffs, trade agreements, tax treatment of overseas corporations), but it also involves strategy around war and conflict, around global resource allocation, and around solving global problems that require cooperation between nations.

External strategy is complicated for a country

President Trump has made it clear that we will no longer be the world’s policeman, without compensation. That’s taking an economic approach to strategy.

That’s one piece of the puzzle. Unlike in business, however, countries deal in currencies other than money. Global problems affect us whether we want them to or not. China’s coal-fired power plants cause atmospheric pollution whose effects we feel. Power vacuums in the Middle East gave rise to terrorist groups like ISIS (ironically in response to our leaving Iraq too soon).

That’s what foreign policy is all about. It’s how we relate to the world stage vis-a-vis world problems. In America, the buck stops with the President when it comes to foreign policy.

There are a lot more moving parts when it comes to a country’s external strategy. External strategy needs to blend economics, diplomacy, war, foreign aid, and probably other things as well, if we’re to maximize our country’s well-being.

On his first weekday in office, today, he has already pulled out of the Asian-Pacific Trade Pact and the TPP. He is clearly sending strategic signals, that America will be withdrawing from free trade deals, with the hope that it will bring jobs back to America. Whether it does or not remains to be seen.

Between the time I wrote the last paragraph and this one, Trump has also actually given orders to build a wall with Mexico, and has discussed pulling out of NAFTA. The speed of these orders and lack of discussion given to the implications suggest to me that these strategic-level decisions are being made dangerously quickly.

Non-economic issues matter to a country’s external strategy

So far, the non-economic elements of Trump’s strategy are a mixed bag. He’s done some things that have horrified career diplomats, such as hinting that the US will pull out of NATO. That may be a negotiating strategy designed to get other countries to foot their part of the bill (an economic strategy). And at the same time, the rest of the world is looking at the non-economic elements (their own safety) of that statement.

His foreign policy might be brilliant. It might encourage other countries to fall in line behind us. Or it might scare others into shifting alliances and finding ways to need the United States less, which ultimately gives us less power in the world and less influence in world events that may affect us.

If it’s true that Trump is actually being manipulated by Russia, presumably Putin is doing so to the advantage of Russia, and not to the advantage of the U.S. But that’s probably a determination that will have to be made in hindsight.

There is already a motion on the house floor for America to pull out of the United Nations. That’s the kind of move that has huge potential repercussions. Some of those are psychological, but some are quite concrete. If we leave the U.N., and the remaining countries in the U.N. remain and act as a single body, we’ve just given up any sway we had as part of any issues the organization addresses.

I don’t think we can draw any conclusions, yet. He’s pulling a lot of levers very quickly, and we haven’t yet seen how the effects ripple through the world.

What he’s doing on the non-economic dimensions seems scary to me, but … he could be right. What he’s doing is drastic. Strategically? Just as we can’t know what the final benefits of his strategy will be, we also don’t know what unintended consequences such a strategy might have.

Internal strategy

Internal strategy is determining how best to use the resources of the country to increase overall well-being.

This one’s tricky; I don’t understand even a small number of the issues myself. As for national building blocks of well-being, here are some of the ones I am thinking of:

  • a population of 300 million
  • a public school system
  • certain publicly owned natural resources
  • an electrical grid
  • physical infrastructure
  • farmland
  • a market-based economic system
  • financial markets

The question is whether our CEO has any strategy that explores the interdependencies between these things over the next several decades, and whether our CEO has any strategy for how to combine them to help our country succeed.

Maybe he does, maybe he doesn’t. I haven’t been convinced that any President in my lifetime has had much of an overall strategy. They all seem to have fragments of strategies for each area, largely disconnected from one another. Since all of those things influence each other, the one approach we know is probably wrong is to treat them as silos.

From what little I’ve heard Trump say, I don’t think he has any kind of sophisticated strategy for best using our internal resources. This does not make him unusual, however. If any other candidate, or any President I’ve heard in my lifetime, has had such a strategy, they’ve never talked about it in public.

Trump’s appointment of non-scientists to posts which require scientific knowledge (or at least the understanding of what science is and how it works) is worrisome. America’s strength over the last century and a half has come from our technological progress, on which we’ve built our economic and business progress.

We’ve already ceded several important industries to other countries: manufacturing, computer hardware and electronics fabrication, etc. Now’s the time to be doubling down on education and scientific infrastructure that can form the basis for American and world prosperity for the next century. My impression is that Trump is going in exactly the opposite direction.

Summary

Trump is making rapid-fire strategic decisions that have global and local implications for the economy, for the environment, for the future of our national competitiveness, and for our safety. On the surface, his policy decisions seem to be made as a hodge podge of campaign promises, not as part of an integrated strategy that takes into account the multiple dimensions of his actions.

While it’s too early to tell how his strategies will play out, I’m pessimistic. In my experience, big, complex decisions made hastily don’t often lead to success.

 

Part 2 of President Trump CEO, continued…

Leading by Example: Walking Your Talk … Under a Magnifying Glass

Why don’t my people just do what I say?

It’s a common refrain among my executive clients. Life at the top would be so much easier, if only “they” would “get it.”

In fact, your employees probably _are _doing what you say. You just may be saying things you don’t intend. It’s often not your broad proclamations that give direction; it’s the little things you do that have the biggest impact.

Your actions encourage and discourage behavior

Remember when you were a front-line employee. Executives’ actions were relentlessly scrutinized. A late arrival, a smile, or a nod could introduce chaos. A CEO I worked with was looking over his marketing department’s latest campaign. He frowned at a storyboard before strolling away.

Unknown to him, the team saw the frown, scrapped the campaign, and spent the weekend reworking everything from the ground up. When he found out, he was flabbergasted. He never thought a simple frown would change the team’s direction.

Your reactions to employees and their work will send signals. Remember this! If you notice yourself frowning or smiling, nodding or shaking your head when it may send the wrong message, stop. Think about the message you may have sent, and say or do whatever it takes to make sure your audience knows your intent.

Watch your words, too. A joke may not be a joke. A consulting firm’s Managing Director smiled and quipped “Remember, if you’re not here Sunday, don’t bother coming in Monday.” He was smiling. Everyone knew he was joking. And as one team member later told me, “I felt like I had to come in Sunday. Sure, he was joking. But he’s the Managing Director. Maybe it’s not 100% a joke.”

You lead by demonstration

Of course, the Managing Director was there Sunday, thus insuring everyone would know weekend appearances are mandatory. Your actions will, by demonstration, always be the most significant way you communicate standards of behavior and priorities to your company. The Managing Director cared deeply that his people have an outside life, and said so on many occasions. But his coming in on weekends spoke louder than his words in signaling acceptable behavior.

What you don’t do also matters

What you don’t say out loud, the actions you don’t acknowledge, and the signs you don’t show send powerful messages, as well. The messages sent by omission are harder to detect. After all, there‘s nothing there to examine! But there are things your employees might expect that aren’t forthcoming.

If you don’t acknowledge people, it can send a message that you don’t value their contribution. Different people need different acknowledgment. For some, it’s public recognition. For others, it may simply be mentioning “Hey, you did a really great job.”

If you don’t give feedback when someone does a poor job, you send the message that their performance is fine. If someone is screwing up, they deserve to know as early as possible. Otherwise, they’ll walk away with a message that does neither of you any good.

Common courtesy is increasingly rare, and its absence communicates a subtle lack of respect or lack of individual concern. A simple “Please,” or “Thank you” with a smile and direct eye contact takes only a couple of seconds. If you don’t have time even for that, then people will (rightly!) conclude they aren’t important enough to warrant your attention.

Making decisions in isolation quickly lets people know you don’t trust them. I have worked with companies in which the senior managers are very open with their big decisions, and other companies in which “we can’t tell them that” is a common refrain. As far as I can tell, involvement signals faith that your employees have something of value to contribute. When that involvement is missing, the message of distrust is loud and clear.

Not sharing bad news sends the message that everything is fine. It’s easy to keep bad news quiet, for fear of hurting morale. But framing bad news as a reason to rally builds a team instead of breaking it down. Shared challenge is the stuff of bonding. Use it!

A Great Business Leader Knows His Impact

Matsushita, one of history’s most successful businessmen, knew the impact he had on everyone around him. As this story shows1, he even appreciated the messages conveyed by what he didn’t do.

The father of $75 billion empire, Matsushita was revered in Japan with nearly as much respect and reverence as was the Emperor. And he was just as busy.

One day, Matsushita was to eat lunch with his executives at a local Osaka restaurant (Matsushita Leadership by John Kotter). Upon his entrance, people stopped to bow and acknowledge this great man. Matsushita honored the welcome and sat at a table selected by the manager.

Matsushita ate only half of his meal. He asked for the chef, who appeared in an instant, shaken and upset. The Great One nodded and spoke: “I felt that if you saw I had only eaten half of my meal, you would think I did not like the food or its preparation. Nothing could be less true. The food and your preparation of it were excellent. I am just old and can not eat as much as I used to. I wanted you to know that and to thank you personally.”

Concrete next steps

If you find yourself under the magnifying glass, here are ways of mastering the situation.

  1. Don’t get caught off guard. Schedule five minutes at the end of the day to review your day, note who you came in contact with, and simply ask yourself what messages you sent.

  2. Use the magnifying glass deliberately. At the start of the week, choose a message you want to communicate by example. Spend a moment or two identifying exactly where you can send the message, and how you have to behave to send it. Then do it.

  3. Check for messages of omission. During your daily review, ask yourself who you didn’t contact, but who might have expected it (you may not know who at first, but over time, you’ll learn). What message does the lack of contact send? What message will rumors of what you did do send to those who didn’t see/talk to you?

  4. Review company systems. To make sure you’re sending the same message as your company, review the systems once a year or so. Review your compensation plan: what does it communicate about company goals? What behavior does it encourage? Discourage? Review your decision making and feedback processes. Ask yourself if you’re omitting anyone or anything in those areas.

Communicate well!


  1. Matsushita story excerpted from Dr. Mark S. Albion’s Making-a-Life, Making-a-Living ML2 E-Newsletter #56. Free subscriptions and information on his New York Times Best Selling new book can be found at http://www.makingalife.com. ↩

More than one strategy is actually… no strategy at all.

Creating a strategy

My friend Carey’s business had stalled. Since I’m one of those people who loves to offer unasked-for advice (knowing the recipient will be eternally grateful), I offered some. “You need an overarching strategy,” I intoned, sagely. The unfathomable response, “Thanks, but no thanks. I already have lots of strategies.”

Lots of strategies? Hmm. You can’t have multiple overarching strategies at once. But Carey wouldn’t know that, because we’re never taught what a strategy is, or how to make sure you have a good one.

Do you have a strategy? For business? For life? Do you even need one? What is one?

Strategies Aren’t Tactics

People use “strategy” to mean a to-do item, but that’s not a strategy. That’s a tactic. Carey has 16 different products under development at once. Those aren’t 16 strategies; they’re 16 tactics.

A strategy is a directed plan you use to commit your time and action in a single direction. By aligning how you spend your time, your money, your resources, and your communication, you greatly increase your chances for success.

If Carey’s projects include designing a high-fashion clothing line for the Milan runway and opening a Veterinary Pet Grooming franchise, those will compete for time, attention, and dollars. When the clothing line needs another 5-gallon tub of sequins (I never said Carey had taste), that’s money that could have been spent on tick sponge-on. Neither business gets the full resources needed to insure success.

Set a Vision that Drives Your Work

Before you can create your strategy, you need to know where you want to end up. What’s the result the strategy is designed to produce? That’s the vision that drives your work.

Start your strategy by setting a compelling, substantive vision. A vision needs to be specific enough to use to make decisions. It needs to be general enough to allow flexibility in what you choose to do.

My friend Rowan’s vision is “to build a business.” That’s so vague that it could cover everything from fashion design to tick removal… and so it does.

But make it more specific, and it becomes a powerful guide. In an alternate universe where Rowan is capable of focus, the vision could become:

A business that helps pet owners keep their pets healthy 365 days a year[1].

This vision can be used to decide which product lines to enter, and to allow a range of options: tick treatment and nutritional consultation both fit. It can also be used to decide which product lines notto enter: high fashion that features too many sequins[2]. It’s just specific enough to guide a good strategy.

Create a Strategy Linking Your Goal to Your Reality

Now you have a vision. But while visions are great, they’re still too abstract for action. If a new Puppies R Us (We Sell ‘Em, You Care For ‘Em™) opened down the street from Rowan’s storefront, concentrating the business on dog care could be Rowan’s ticket to mansions and private planes. But if the new store is Spiders Galore: Unusual Pets for Unusual People, concentrating on the care and grooming of Brachypelma emilia might make the most sense.

Begin crafting your strategy by linking the vision to your current reality. Assess your resources — what you have a lot of, and what you’re short on. Assess your situation — outside forces that might help or hinder different courses of action. Create a high-level plan that uses your resources to move towards some way to realize your vision, given your current environment.

Rowan can take the pet health business vision, and link it to the things in real life that will make it happen.

Point tactics towards a vision to get the job done right. Then link it to reality.

If Rowan has home office space, an email list of pet owners, and a vast network of veterinarians, Rowan’s strategy could be to form an online pet care referral network. There could be an app, and a website, and a huge campaign to sign up hundreds of veterinarians from around the world.

If Rowan has a retail storefront near Puppies R Us, but no mailing list, the strategy could be to create in-person care for dogs and dog-related issues. Rowan could even propose a collaboration with Puppies R Us where Puppies promotes Rowan’s business and gets a referral fee.

These are two different strategies. Both lead towards the vision of “a business that helps pet owners keep their pets healthy year-round.”

Being in possession of the retail storefront, Rowan chooses the strategy of providing in-person dog-related care.

Keep Your Strategy Clear

Lastly, keep your chosen strategy clear and singular. You might have many tactics that comprise the strategy. Rowan can get the word out in many different ways: online banner ads, leaflets in the local community, and a Puppies R Us partnership. These are pretty different activities, but make no mistake: these aren’t strategies, they’re separate tactics supporting a single strategy.

By having only this one strategy, Rowan can now concentrate all resources on the storefront. If the opportunity comes up to run a nationwide banner ad, the explicit strategy tells Rowan what to do: say “no” to the ad; advertising a Springfield puppy health service in Skokie makes no sense.

Think Strategically Throughout Your Life

A strategy helps you make decisions about where to put your time, money, and attention. We’ve been exploring strategy in business, but you can apply strategic thinking to other areas of your life.

What is your vision for your life? For your family? Your Career? Spend some time forming your vision. Then look at today’s reality, and choose a strategy that will realize that vision as possible in your life today. You’ll get a lot more of what you want in life, and a lot less of whatever random the world throws at you. Then you can put your efforts into tactics that support your strategy.

A scattershot approach to success is a recipe for staying stuck. Avoid this by organizing your tactics and resources using a well-chosen strategy. Align it all in pursuit of the vision that inspires and energizes you, and you’ll soon be enjoying plenty of success, while still having time to stop and pet the puppies.


  1. Closed on February 29th.  ↩
  2. Lack of fit with the vision is only one reason not to enter that particular business.  ↩

JetBlue speeds towards brand destruction

The essence of a strong brand is differentiation in a way that makes customers want to use your product or Service. JetBlue has announced a decrease in legroom and increase in baggage fees in an attempt to boost lagging profits. All I can say is, “idiots.” The entire key to branding is to have strong differentiation from your competitors. In Airlines, the only differentiators are where you fly, your prices, and your service experience.

For JetBlue, service experience has long been a serious differentiator. I would go far out of my way to fly JetBlue instead of other airlines, and I’d pay more, because the experience was just so nice. The fact that the fares were competitive was nice, but I would have paid a premium for the level of service I got.

So now that profitability is lagging, how does JetBlue choose to respond? By attempting to maintain low price position and moving towards a low service position too. Heck, what are commodities for, if not as a dying place for once-strong brands who bow to the short-sighted idiocy that has become the financial markets.

The current JetBlue executives should have their salaries and bonuses clawed back in five years if this does, indeed, herald the beginning of the end of a once-strong brand.