ITL #406   Intentional crisis mismanagement: how organizations can damage themselves

8 months ago

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The misplaced sense of invincibility among leaders and a failure by organizations to challenge it are catalysts for disaster. By James Lukaszewski.



Every organization is at risk for a crisis, which I define as, “a people-stopping, product-stopping, show-stopping, reputation-redefining, trust-busting situation that creates victims and/or explosive visibility.” More unethical decisions are made faster during crisis than almost any other scenario in management.

 

Although few crises reach “explosive visibility” levels, all produce victims: people, animals or living systems; such as forests, rivers, or even somebody’s backyard. Victims mishandled present an enormous threat to reputation and senior executive survival.

 

Some crises, like natural disasters, can only be forecasted. The choice of how – ethically or not – any crisis is managed (preempting, predicting, preparing, responding to, warning and managing victims) is determined by the surviving leadership. Empathy and apology are two of the most crucial response ingredients. The quality of the response determines the level of reputation damage or enhancement. A flawless technical response is possible, but fumble stumble and bungle empathy and apology and that’s how your response will be remembered.

 

After more than 40 years in the trenches I have learned that all questionable, inappropriate, unethical, immoral, predatory, improper, victim-producing and criminal behaviors are intentional. Adults and older teenagers consciously decide to do or permit actions and decisions they know are wrong. I also believe that all ethical, moral, compassionate, decent, civil and lawful behaviors are intentional. The choice is always obvious.

 

Mismanagement typically comes in two categories. The first is what I call invincibility; a real sense of power that long serving executives and younger, hotshot executives acquire and accumulate. Over time, an environment of what organizational psychologist Merete Wedell-Wedellsborg calls, “omnipotence, cultural numbness and justified neglect of ethical behavior” are created.

 

The second category is organizational failure to respond or challenge invincibility. Leadership decisions are silently understood or specifically ordered (usually by lower level managers, often without top management knowledge). Examples range from silence to denial, to the reluctance to apologize or exhibit empathy, or worse, maligning victims and those who represent them.

 

How misbehavior leads to failed leadership

Most misbehavior begins in small ways but grows as misbehavior is allowed to proceed, often to the surprise of the perpetrator when their misbehavior is met with silence and without objection. The perpetrator is encouraged to try it again, but on a larger scale. Many sources express concern at the increasing number of misbehaviors occurring in businesses and organizations of all types. Even though the actual range of misbehaviors is relatively narrow.

 

The elements of failed leadership are obvious and survive because they are unmentioned and unnamed. Here is a list of these failed leadership behaviors based on the author’s experience. There are undoubtedly more.

 

The real value of this list is as an alert for leaders themselves and those around leaders. Those around leaders who witness negative or risky circumstances need to get and inform leadership immediately. Time and time again, leaders excuse their misbehavior, shifting the blame for their intentional mistakes to, “those around me who should have alerted me or caught me”. Leaders who become perpetrators are prepared and practiced at shifting blame, if exposed or caught. There are recognizable prior events that signal existing or pending misbehaviors.

 

The Ingredients of Failed Leadership

 

  1. Established values and cultural systems and norms are gradually ignored, neutralized, or displaced by whatever become accepted yet questionable behaviors.

 

  1. A management-imposed emergency or attitude of urgency that goes unchallenged. The phrase, “Do whatever it takes,” is among the most prevalent of excuses for breaking, changing or ignoring rules. This phrase is taken as an order and an authorization to literally ignore all rules and constraints to achieve whatever the objective happens to be.

 

  1. A sense of ongoing top management pressure to “get on the program”, without challenge or without reporting through compliance channels. Too often, in today’s organizational structure, goals are taken as permissions, authorization, or orders to ignore the rules. Those in charge (through their own behaviors and stated or implied expectations) change the rules or establish new ones unilaterally outside of normal compliance channels. Crises rarely start, “in the mail room”, or by “a bunch of rogue employees”, or by junior people. Crisis behaviors and attitudes start at a much higher level.

 

  1. Early warning symptoms are ignored, deferred, or actively defended. Who wants to be the first to vocalize something negative about a boss or point a finger? Invincibility and omnipotence triggered by incivility are among the major features of management behavior these days. Male or female, getting an MBA and the MBA culture confers the ability to leap tall buildings, become inherently smarter than anyone else, and to treat rules and cultural norms as options.

 

  1. An atmosphere of invincibility that overshadows or simply blinds participants to infractions, questionable decisions, and stuff that should work but doesn’t.

 

  1. Corner–cutting. One of the most common starting places for leadership failure to begin.

 

  1. Increasing resistance to or minimizing compliance and oversight. There is a natural tendency to resist compliance and oversight. The greatest resistance generally comes from the sales and marketing sectors of a business organization and that resistance is induced by the pressure to perform, the pressure to succeed, the pressure to beat the competition, and the pressure to beat peer organizations.

 

  1. Decreasing responsiveness to regulatory requirements. Once an organizational culture moves away from responsiveness to regulatory requirements and begins selectively ignoring or degrading the importance of these requirements, the pattern of failure grows on itself.

 

  1. Persistent, rigid, disciplined silence. The implied or direct order to remain silent is powerful and toxic.

 

  1. Continuously making ever larger compromises to accommodate or cover up previous intentional misbehaviors. Once a manager decides to cross a line which is always intentional, they become a perpetrator. Still, they are surprised that there is no real reaction, the tendency is to cross another line to see if that works too. Surprise, surprise, it also is ignored. All too often, when an autopsy is done on failed leadership, a crucial element in the pathology sounds like, “I took a chance, nobody noticed, so I took another, nobody noticed, so I took another, and it became a habit,” “Why didn’t those people say something or do something when they found out about it?” and, “It’s really their fault for not catching me and warning me or turning me in that all these bad things happened.” The description that best describes these intentional executive misbehaviors is Risk Addiction.

 

Some experts have described Risk Addiction as very much like the behavior of drug addicts, gamblers, smokers, and sex offenders. These perpetrating individuals absolutely know how devastating and damaging their behavior is but continue anyway. In risk addiction the intoxicant is power and the willingness of others; colleagues, victims, witnesses, compliance officials, board members; to succumb to that power by failing to oppose, disclose, or expose it. Leaders in power, immersed in a culture that says “yes” literally all the time, increasingly act without waiting for a yes or a no. The unilateral decision to move ahead sometimes compels a “yes”.

 

The management tools for detecting, deterring, and defeating risk addiction are disclosure, behavior labeling, and aggressive but constructive exposure. If you witness intentional crisis mismanagement my advice is clear: speak up. silence is the greatest enabler and validator of misbehavior. Those who observe, are injured or affected by, or who know how many others will suffer, need to speak up, despite the risks. Otherwise, executive misbehavior tends to grow and become more clever, audacious, novel, and damaging.

 

Invariably, once the perpetrator is caught or exposed, they will immediately blame those around them, who, “Should have warned me or prevented me from making these decisions.” We only have ourselves to blame.

 

Common intentional leadership and management misbehavior patterns

that transform problems into existential crises

Sometimes the only way to help organizational leadership and senior management avoid embarrassment, humiliating visibility, enormous litigation, and just plain stupidity is to illustrate dramatically the patterns of intentional misbehaviors and actions that lead to catastrophic reputational trouble. Leaders and managers do make decisions they know are wrong, inappropriate, even unconscionable because they can.  Staffers and advisors, attorneys, consultants in the room fail to successfully object if they even try. These are the pathways to irreversible trouble, likely unemployment at the top (though often with a big departure bonus).

 

1.       Silence:

The most toxic strategy possible. Makes you look like a perpetrator, whether true or not. There is no credible way to explain silence in the face of crisis. Silence is the most frequent leadership career-killer in crisis situations. It’s why the boss gets fired first.

 

2.       Stalling:

Speed beats smart every time. Failure to act immediately, even incorrectly, is impossible to explain or apologize for. Doing nothing, even for what appear to be good reasons, is never explainable. #1 response criticism: failure to speak and act promptly.

 

3.       Denial:

Refuse to accept the fact that something bad has happened and that there may be victims or other direct effects that require prompt public acknowledgement.

 

4.       Victim Confusion:

Irritable reaction to reporters, angry neighbors, and victims’ families when they call asking for help, information, explanation, or apology. “Hey! We’re victims too.”

 

5.       Testosterosis:

Look for ways to hit back, rather than to deal with the problem.  Refuse to give in, refuse to respect those who may have a difference of opinion or a legitimate issue.

 

6.       Arrogance:

Reluctance to apologize, express concern or empathy, or to take appropriate responsibility because, “If we do that, we’ll be liable,” or, “We’ll look like sissies,” or, “We’ll set a precedent,” or, “There will be copycats.”” People we don’t respect will get credit or recognition they don’t deserve.”

 

7.       Search for the Guilty:

Shift blame somewhere else while digging into the organization, looking for traitors, turncoats, troublemakers, those who push back, and the unconvinceables.

 

8.       Unconscionable behavior

Personal attacks on organizations, individuals, even victims, demonized, humiliated, disbelieved, and denigrated. Threatening and menacing, belittling respected experts and expertise, ignoring valid and reasonable information and data. Making things up. Persisting in using information that is known to be false.

 

9.       Whining:

Head down, finger in your navel, shuffling around, whining, and complaining about how bad your luck is, about being a victim of the media, zealous do-gooders, wacko-activists, or people who are nobodies, who don’t know anything; about how people you don’t respect have power; and, that you “don’t get credit” for whatever good you’ve already contributed.

 

Management in America and increasingly the business world in general live in a culture of invincibility and,” really smart people.” Predictably when these intentional misbehaviors are disclosed or revealed even “smart people” cannot talk their way out. Bad news always ripens badly. Misbehavior makes everything worse faster. Choosing misbehavior is a high-risk strategy frequently, knowingly, and carelessly transforming a business problem into an existential business crisis. Crisis always start at or near the top.

 

 

 

 

 

 

 

 

 

 

 


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The Author

James Lukaszewski

James Lukaszewski, Chairman, The Lukaszewski Group, Bloomington, MN has helped troubled leaders in organizations large and small. His latest book from McGraw-Hill, co-authored with Steve Harrison, is The Decency Code: The Leader’s Path to Building Integrity and Trust.

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