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News of The World – A moral crisis in the making? July 11, 2011

Posted by Alan Yu in Culture, Leadership and management, Management, Philosophy.
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The printed media industry, like the music industry, has been under pressure in recent years.  Convenient and timely electronic access to a wide variety of content has all but rendered traditional methods of delivery irrelevant.  When you can get breaking news as it happens, as long as you are on line, why would deadlines for inclusion in printed newspapers matter?

Reeling under conditions of hyper-competition to survive, let alone thrive, many big-name magazines and newspapers have had to find ways to differentiate themselves.  These include news “scoops” which are possible only through clandestine tactics involving invasion of privacy and rampant disregard for human decency.  Hacking into voicemail accounts of murder victims and celebrities is par for the course if it provides an edge on stories that pique the interest of readers.

On the surface, moral outrage against such practices has brought down UK’s Sunday tabloid News of The World (NOTW).  The abrupt decision by Rupert Murdoch’s media empire News Corporation to close the newspaper raises a number of questions in its wake.

The decision announced by News International’s Chairman James Murdoch that the edition of NOTW on July 10th, 2011 is its last appears at first sight to be admission of, if not atonement for, culpability in the phone hacking accusations.  In his statement on the closure, Murdoch says: “The good things the News of the World does, however, have been sullied by behaviour that was wrong. Indeed, if recent allegations are true, it was inhuman and has no place in our Company.”

Murdoch sugar-coats the decision by claiming to take the moral high ground, but even  commentators who are not die-hard cynics have reason to believe that other motives are behind it.  Terminating a 168-year-old institution is a momentous decision that cannot be taken lightly, especially when many jobs are involved, and even in the context of the allegations of outrageous practices by its staff, surely can be but the last resort.

First, there are commercial considerations.  Like many other brands in recent times publicly dragged through the dirt of scandalous behaviour, for example, Tiger Woods, NOTW is likely to face mass desertion by commercial benefactors
such as advertisers, at least in the short term, damaging its commercial viability.  Yet as the dominant Sunday tabloid with a circulation of 2.6 million readers, NOTW is probably profitable, and can withstand a little pressure before sinking into red ink.  Besides, shrewd businessmen such as the Murdochs don’t just give up a profitable venture that easily.

Many point to Murdoch’s intention to launch a title that mirrors the highly successful The Sun, which doesn’t publish on Sunday.  On July 5th, two days before the NOTW closure was announced, two URLs, TheSunOnSunday.com and TheSunOnSunday.co.uk, were registered.  Could closure of NOTW be a convenient way to re-brand it as The Sun?

Second, closing NOTW is a masterstroke of guilt denial.  By cutting off what might be a rotten branch, James Murdoch is clearly trying to distance himself and the rest of News International from the culprits as the tree that remains unspoiled.  Yet Rebekah Brooks, the editor in charge when NOTW committed the alleged offences, remains a trusted executive of News Corporation.  Rupert Murdoch is said to have expressed “total support” for her as CEO of News International.  Could she be the one bad apple?

Third, even if the Murdochs are genuinely ignorant about about the outrageous practices in NOTW, as leaders of the organisation, they must take responsibility for the root cause of such behaviour – sacrificing moral standards in a relentless drive for commercial results.  Even if they don’t overtly condone the behaviour of a handful of NOTW staff, they cannot deny endemic failure to maintain moral standards in the organisation.

Debates about the closure of NOTW will continue for months.  Some will concern the commercial brutality facing newspapers in general; others will focus on the symbiotic relationship between politicians and the media.  In my mind, the most important questions we need to answer are:

Are we facing a moral crisis in general, and if so do we even know?

The media survive only if they provide what readers want.  NOTW obviously did this well.  Many readers interviewed by stv claim that despite the phone hacking practices, they continue to buy NOTW.  Are we so inured to injustices in the world that all we look for is the next cheap thrill, and in response are the media right in serving us everything that we want?  If not, are they going to survive?  What wider responsibilities do the media have in defending moral standards and human decency, in the same way as they shape public opinion?

What is the responsibility, if any, of commercial executives to balance the drive for results and maintenance of moral standards?

Commercial enterprises exist to generate profit for shareholders and economic benefits for the wider population.  Many regulations prevent behaviour detrimental to some segments of society, for example unfair competition, price
fixing and misleading product descriptions.  Yet many commercial practices are legal but morally questionable.  How do leaders in these organisations choose between the ignominy of missing commercial targets and defending moral
standards?

What lessons are we going to teach the next generation about NOTW debacle?

The financial crisis of 2008 has taught the world nothing about the fiduciary duty of bankers to protect customers’ life savings.  In fact, banking leaders have shown no remorse for taking, and then passing on, incalculable risks.  Worse still, they feel entitled to millions in bonus payments in return.  As economies in developed countries suffer severe budget cuts resulting from decades of profligacy, it is inevitable that comercialisation of education will intensify.  We have
already shown an avid appetite for vocationally friendly courses at universities (cf. my comments on Middlesex University’s abolition of philosophy courses).  Are we likely to reflect on the NOWT case and pause to think about the need for moral education as a fundamental requirement?

Until we have fully considered and answered the above questions, those who have lost their jobs in NOTW will have done so in vain.  They deserve our sympathy.

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Lessons from Recent Political Leadership Changes July 12, 2010

Posted by Alan Yu in Leadership, Leadership and management.
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The second quarter of 2010 turned out to be very noisy on the political front.  A change of leadership took place in three major developed economies, one through the due process of election, and two before the incumbents had finished the term for which they were elected.  David Cameron replaced Gordon Brown as Prime Minister in the UK, Naoto Kan replaced Yukio Hatoyama in Japan, and Julia Gillard ousted Kevin Rudd in Australia.

To paraphrase Lady Bracknell in The Importance of Being Earnest, to lose one prime minister may be regarded as a misfortune; to lose two looks like carelessness; and losing three is downright recklessness.  Yet the tumultuous events of May and June in these three countries are rich with lessons for leaders who live under more salubrious circumstances.

Be sincere and respectful

By the time the polls took place on May 6, few in the UK expected Gordon Brown to return to Downing Street after the election.  As Chancellor under Tony Blair, his wait for the leadership role had long outlasted his patience.  He was often criticised for being rather dour.

Yet for all his faults the one thing that put the last nail in his electoral coffin was making derogatory remarks about a supporter he had just met.  Settling down into the car after meeting a long-time Labour supporter, not realising that he still had a microphone pinned to his shirt, he was heard calling one Mrs Duffy “a bigot”, saying to his aide: “That was a disaster – they should never have put me with that woman. Whose idea was that? It’s just ridiculous.”

Brown’s tendency to find someone to blame was characteristic of him and probably not catastrophic, but Mrs Duffy later said that she was most upset about being described as “that woman”.  This exposure of Brown’s scorn for his supporters was devastating.

Have a vision and stick to it, and explain any change clearly

Kevin Rudd came to power in more or less a landslide.  Climate change featured prominently in his campaign against the Howard government, calling it “the greatest moral, economic and social challenge of our time”.

According to the Herald Sun, in December 2007 Rudd “did an about-face on deep cuts to greenhouse gas emissions, days after Australia’s delegation backed the plan at the climate talks in Bali”.  He apparently changed his mind after hearing warnings that it would lead to huge rises in electricity prices.  The Guardian called his subsequent abandonment of the carbon emissions trading scheme legislation in April “a remarkable act of political cowardice, if not ineptitude”.

Yukio Hatoyama’s Democratic Party of Japan swept to power nine months ago after defeating the Liberal Democratic Party with promises to return more power to local governments, especially on Okinawa bases which local residents resent.  Yet instead of moving the deeply unpopular Futenma US military base off Okinawa altogether, he decided to relocate it to another part of the island.

Neither Rudd nor Hatoyama appeared to have taken much trouble explaining to their followers why they had changed their minds on key planks of their campaign platforms.

Consult, consult, and consult

According to Kevin Rudd, his Deputy Prime Minister Julia Gillard informed him on the evening of June 23rd, 2010 of her request to hold a leadership ballot the following morning.  Factional leaders within the Labour Party were worried about losing the next election.

The last straw that broke the camel’s back in the party caucus was Rudd’s insistence on pushing through a massive increase in a special profits tax on the mining industry, apparently without much consultation with his colleagues.  Although the proposal was part of a report on tax changes, the magnitude of the tax increase surprised the mining industry.  In the end, Rudd had lost touch with his colleagues and supporters in the party.

Swift symbolic acts upon assuming power

What of the successors to Brown, Hatoyama and Rudd?  They all appeared to have moved quickly to make important symbolic changes, exploiting their political capital during their honeymoon as newly elected leaders.

David Cameron and Nick Clegg, in the first coalition government in the UK for 65 years, were falling over themselves to show how they had put aside their ideological differences to work together.  They also lost no time in sternly warning the nation about the austerity needed to bring the UK out of its economic quagmire.  At their first meeting, members of the cabinet declared a 5% cut in their salary as a symbol of collective belt-tightening.

Julia Gillard in Australia moved quickly to declare publicly in her acceptance speech that she would cancel the government’s planned advertising in support of the mining tax.  In return, she asked the mining industry to abandon its advertising opposing the tax.  Within two weeks, she reached agreement with the mining industry on the tax, although by making important concessions on the government’s position.

Succession by a member of the same team

Both Rudd and Hatoyama have been replaced by a member of the team who had worked closely with them.  As Deputy Prime Minister, Julia Gillard would have had a hand in formulating the key policies for which Rudd suffered ignominious defeat in the hands of his own party’s power brokers.  Quite apart from the implications of her appointment on the democratic process of electing leaders, why would her succession as Prime Minister signal any change?  Did she genuinely express dissent during discussions about the mining tax, or was there no discussion at all?

Likewise, Naoto Kan was Finance Minister in Hatoyama’s government.  How can one expect that as Prime Minister, he can implement economic policies which will help Japan reduce its mountain of debt and revive the economy?  Did he have the guts to stand up to Hatoyama when he decided to give in to the Americans on the military base in Okinawa, or was he a willing partner?

When a political leader is ousted for policies which appear to have failed, why should the electorate believe that an important member of the team succeeding him or her will bring the needed change?

In summary

From changes in political leadership in the UK, Japan and Australia in the last couple of months, all leaders should heed the following lessons:

–          Followers, no matter how low in the chain of command, deserve and expect to be treated with respect and sincerity, not merely as a means of shoring up the leader’s position.

–          Followers expect leaders to keep their key promises, and when they don’t they need to understand why.

–          Although leaders are there to make decisions, they should not assume that they can do so alone, without consulting or convincing members of their teams.

–          When leaders assume power in circumstances where change is clearly expected, they will do well to make timely moves that signal a break from the past.

–          Successors to fallen leaders who are key members of the previous team need to confront the scepticism that greets their assumption of power.  Explanation of their involvement in previous policies will help dispel doubts about the possibility of real change.

Grammar, leadership and clarity of thought April 26, 2010

Posted by Alan Yu in Communication, Language, Leadership.
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It has been a harrowing few weeks, and finding time to write original material for the blog has been a challenge.  I tried to recycle material I had received from friends and associates, but that turned out to be quite inadequate as well.

Instead I spent the little time I had to re-read an article by an actor I admire, about a fascinating new product from a company I respect, in a magazine long established as one of the best in the world: Stephen Fry’s article in the April 12th 2010 edition of TIME magazine on the iPad: http://bit.ly/bY9ah5

Doing that opened the floodgates.  I noticed something in the article which I had missed altogether when I skimmed through it the first time – a grammatical mistake!

No, I said to myself, that can’t be true.  A grammatical mistake in a TIME magazine article by a world-renowned actor and author spotted by an ignoramus like me?  That’s not possible.

I rubbed my eyes, and read the offending sentence over and over again.  I concluded that it was a mistake.  Here’s the passage where the error occurs (page 29 of the written article and at this link on the web: http://bit.ly/aP7eWa), as Fry describes Steve Jobs, Apple's CEO:

“…I do believe Jobs to be a truly great figure, one of the small group of innovators who have changed the world. He exists somewhere between showman, perfectionist overseer, visionary, enthusiast and opportunist, and his insistence upon design, detail, finish, quality, ease of use and reliability are a huge part of Apple's success..

Job’s insistence on the variety of factors that account for Apple’s success is a singular noun, and therefore should be followed by “is” rather than “are”.  Had the first part of the sentence been written “The aspects of the product he insists on getting right – design, detail, finish, quality, ease of use and reliability…”, then it would have been appropriate to use “are”.

Let me be clear: finding a mistake in TIME magazine is a rare occurrence.  Its editors are human and therefore susceptible to the same chances of oversight as everyone else.  To err, after all, is human.

Which is not to argue that we should consider it acceptable, as many writers nowadays do, on the pretext that when the English language becomes more common as the medium of communication among people from different backgrounds, we should be more tolerant towards grammatical mistakes.

That’s codswallop, as it’s tantamount to saying that Pidgin English is good English.  Grammar is a set of rules by which sentences in a language are constructed and therefore understood.  To tolerate grammatical mistakes is to condone fuzzy thinking, which makes for bad leadership.

A simple grammatical mistake does not a bad leader make.  Perhaps, but an important skill of a good leader is the ability to communicate clearly.  How can a leader do so when grammatical mistakes clutter up speeches and proclamations, thereby creating confusion, ambiguity and suspense?  Besides, leaders are supposed to set examples.  If they tolerate sloppy use of language, woe betide their followers when they write and speak.

Recently I came across an excellent talk by Clive James, an Australian raconteur and author who has been living in the UK for some time.  In May 2006 the Australian magazine The Monthly carried an article he wrote on the English language, entitled “The Continuing Insult to the English Language”.  He explains further on his web site:

The piece …attracted a gratifying amount of attention, although I got the impression that I was preaching to the converted, whose numbers were dwindling. Even if that were so, I got the chance of preaching to a lot more of them when Jill Kitson of the ABC asked me to turn the text into a broadcast… 

The broadcast can be heard at this link: http://bit.ly/dhNym5

James continues:

That melancholy long withdrawing roar you hear in the background is generated by all the surviving members of my generation who were taught to parse a sentence. The text of the piece is filed under "Recent Essays" — two versions of the same doomed campaign. 

The text James refers to can be found at this link: http://bit.ly/bbicwT

I am one generation down from Clive James, but if he is right, I must be one of the endangered species of purists who insist on getting things right in language, as I am dead scared of fuzzy thinking.  I am happy to be so.

What we should be asking leaders of financial institutions January 27, 2010

Posted by Alan Yu in Leadership.
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For those of us who don’t benefit much from bank bonuses, it is easy to show revulsion against them, especially when they are estimated by the Wall Street Journal to be US$145 billion in 2009, or by my calculation as much as 50% to 100% of profit.

 

Bonuses are not harmful by nature.  They are harmful only when the objectives they are designed to achieve, and by corollary the behaviour they encourage, are not in the public interest.

 

In his article in the New York Times, Paul Krugman quotes Jamie Dimon, CEO of JP Morgan Chase as saying that a financial crisis is something that “happens every five to seven years. We shouldn’t be surprised.”  Krugman also quotes Lloyd Blankfein, Goldman Sachs’ chief, as saying that the financial crisis was “a hurricane nobody could have predicted”.

 

In light of their remarks, Messrs Dimon and Blankfein have probably not designed the bonus system in their institutions to maintain financial stability and preserve the value of their customers’ life savings.

 

Bank leaders commonly justify bonus payments in spite of the financial meltdown on grounds of remaining competitive.  Those that reward behaviour other than pursuit of profit for shareholders are bound to lose talent.  Worse still, they cannot give the institutions they lead meaning to their contribution other than profit.

 

People often join organizations for money, but they leave mostly for other reasons.  To retain talent, bank leaders need to provide a clear vision on how to prevent the next financial meltdown.  They need to give more meaning than just monetary reward to their followers.  They should show moral character in taking more responsibility for the crisis.  Above all they need to understand fully what behaviour the bonuses they pay promote, and make adjustments accordingly.  Unless they do so, we can be sure that the next crisis is just around the corner.