Toxic bosses and “Badnagement”, do we need an Hippocratic oath?

Not everything is good with top managers and management, whatever says the theory and management reviews. In a managerial position, executives should think about what they do, that can harm others and themselves. Pressure on performances, delays, budgets force managers to take shortcuts that are not good in the long term.

Managers think about achievements, performance, and compensation. Too often, they go for quick wins, as they do not have time to think about what they do and how and why they do it. Among the most critical topics, frequently not taught in MBA programmes, one can hardly find issues about manipulating others, poor governance, difficulties to manage paradoxes, unsatisfactory organisation, and lack of ethics or respect. There is no auditing as such of these questions from the HR Department as it is, itself, often part of the problem. Everyone has to deal with it and most often alone.

Corporations maybe not always be the best places in the world but let us face reality; it is hard to do without them.

Everything you should not do when managing people.

Faced with an avalanche of textbooks, articles on good management, buried under loads of trivial literature, mostly made of commonsense, and some rather dogmatic European and Anglo-Saxon press, feeling guilty by the wise comments of faculty members and researchers in referee journals, one can be frightened by the fact that very few good advices are implemented.  Instead of listing all the best practices, all the qualities of good leaders, all the good behaviours and skills of performing managers, let us explore the dark side of management that that we will call: Badnagement.

Advices are good for those who give them.  A famous politician said once, ”promises commit only those who listen to them”.

Let us clear the track.  Nobody said that management should be an ethical activity with characteristics corresponding to the traditional Judaeo-Christian moral principles.  Otherwise, it might be difficult to do business in Asia, Middle East or Africa.  Managers must follow the rules and regulations in each country if they do not want to be in trouble. Islamic banking is setting new ways of doing banking in Islamic countries which means that local management rules there are different.

For some reasons, new managerial behaviours are expected concerning topics that were not explicitly in the discipline years ago.  Sustainability, social responsibility, diversity issues, equal opportunities and many other things that are not in the initial mission of the Corporation.  What is expected from companies today is much more than just bringing good product and services at a fair price, and good management of employees.

In the same time a strong trend show that many senior executives, chairman, CEOs are fired every year, the number being constantly increasing, some people staying just a few months, not even a year. A real “Mercato”. While research has clearly shown that the more top executives would stay in a company the better are the results.

Creative accounting, and cheating on figures, has been a popular game with the support of bankers and consultants. Transparency is not a financial sport as the “subprime crisis” has shown (see the movie “Margin Call”).  At last some people get caught.  There are new regulations, but these regulations will be circumvented.  It is just a question of months.

Where are ethics in all this? As it has always been, it is still the rule of fists, the stronger the better, if you are not caught you are safe!  Locally good communication can dissimulate this for some time. It is true that very few people would like to work for crooks.  “You can deceive someone forever, everybody for some time, but not everybody forever” (A.Lincoln).

Even if no corporation is perfect, entrepreneurs and companies are a necessity, as they can create jobs and wealth, along with the dark side.  Throwing the baby with the bath would be nonsense, as we have no substitute.

Let us try to make good from bad.  For this reason we will talk about this dark side of management

Manipulation

It comes from the same root than management (maneggiare, to lead a horse).  Another source being from the French “ménage”: housekeeping.  Manipulation is something you do with your hands: (manipulus, handful). Ménage and manège are close.  Manipulation is something you do against other people will or knowledge.

Most manager spend a large proportion of the time manipulating.  Some do it explicitly, some do not.  Giving an order (from the Latin ordiri, which means weaving in rows (ordo)) is one of the first management moves.

As it is not always easy to give orders that are not pleasant, the big idea in management is to try to reverse the situation, and let somebody else do it.  As it is difficult to push on a string, it is better to get the string pulled by the other side.  This is why management talks about motivation, commitment, and involvement.  We also talk about common definitions of objectives, and in the best situation of a “contract”.  But is there some kind of equality between a boss and a subordinate?

From this realistic statement, we can unroll the red carpet of management development.

The 20th saw corporations reach a high level of productivity and efficiency.  Most of the manufacturing have now left most of the Western Hemisphere to go to some Asian countries.   Those still in Europe world are highly robotised.  To-day the same consultants have worked on proposition to improve managerial productivity.

This is the challenge. As the industrial sector has left, business schools took over from engineering schools.  One model chases the other.  Information and money takes the place of raw material and energy.  Manpower is outsourced and delocalised.  In most cases, production becomes a commodity (fabless corporations).  In the car industry, most corporations make money on the financing of cars, not on the manufacturing.  As manufacturing is under control, what is left for improvement and savings, is  the population of managers.

Individual and collective efficiency must be controlled.

Quantitative head counts are more important than qualitative talent management.  Thanks to new technologies, common tasks can be done by everybody, and very few managers have still their own assistant.  Pressure on time, delays, costs, quality, e-mails piling, the meeting merry-go-round, and no time left to do the job.  The result of this is a sense of loss of autonomy, reinforced by all the appraisals and assessments procedures.

Leadership, the new buzzword, is like a big bag.  You can find in it everything you may need for any occasion.  As situations are more complex and controversial, line managers expect that subordinate will find in his « leadership bag » all what they need to get through difficult situations.  It is also supposed to bring remedies against lack of competence, anxiety, as well as for subordinates.

But words are not magic wands.  Take an introvert, no leadership seminar will change him overnight in an extrovert.  He may open a little bit.  But going back to the office, things will be the same.  You can manipulate him/her as much as you want, and try to make him believe that he/she has changed, nothing really will happen. Even, as it comes now, spirituality at work is on the agenda of some seminar.

It is true that if the Corporation becomes a sect, management changes.  And it happens.  In some case people are working for nothing as compensation is supposed to come from somewhere else.  This is true within many not-for-profit organisations.  However, when it comes to a normal company, it is sheer manipulation.  The contract is not the same any more, and the terms of the exchange had been transformed.

And manipulating people create a sense of guilt that most managers do not likef.  Not all decisions are easy, simple, ethical, fair and clear-cut.  There is some dark side that managers must live with. There is no good way to tell bad news!

It explains why managers in expert jobs are moving to a freelance position with no managerial issues. The new dependency for the freelance is toward its clients, but with multi dependencies or interdependence, which is closer to autonomy.

As a boss you can manipulate your employees, also shareholders, bankers, competitors, the State, but also can be manipulated by clients or providers.

Under pressure and stress, manipulation is often a short cut to a decision which would otherwise need time to explain and improve. Managers have to be aware of not giving in it too often.

Bad governance

“The fish rots by the head”!  Chinese proverb.

In all quality insurance processes, governance come first (EFQM, Equis, Clip).  Experience shows that if the governing body has a bias, signs and footprints will be seen in the entire Corporation, even multiplied. It works like a genetic signal, and is exemplary.

If the board is composed of people belonging to the same group, old boy network, or family, the capacity to talk about sensitive topics will be limited, and there will be taboos all through the Corporation.  In such a case becoming critical is dangerous.  Some kind of censorship will take place, even more obnoxious as it is implicit.  Being straightforward may cost your job.  You have to be politically correct.  Do not expect the Corporation to work like a democracy.  Talking about what doesn’t work may need courage.  The ivory tower is in place to protect the CEO.  The system is done to give him only the good news.

Adapting constantly the organisation becomes then difficult.  In such cases corporations recruits clones that will get along easily and quietly.  Diversity is dangerous and this is the Kingdom of one-way thinking.

Some boards are very opaque.  Then opacity will be the rule in the organisation.  Nobody will be fool enough to give precious information, and there will be no debate and discussion.  Defensive position will be common on many issues, as information is associated to power.

At the board level, the minimal information is given, and financial performances are privileged.  In a family business, money and dividends are almost the only thing that matters.  Eventually positions of sons or nephews are discussed.  Discussions do not say much about clients and employees, or innovations as they may disrupt some. Financial indicators lead the discussion and internal transactions concerning budgets and location for expenses concerning family members.

In some other boards, one can find flattery or worse, some kind of terrorism.  Reality is far away.  Satisfaction of the CEO and his hubris can be the only rule.  These bad habits can cascade in the Corporation.  Exemplarity will take the wrong road.

Another situation is about a poor understanding of the mission of the board, when it is a supervisory board.  In a family business, when the chairman has been the founder of the Corporation there is a natural tendency for him to keep to his previous executive missions, while the board should be in charge of supervision and strategic decisions.  As the board is doing the job of the executive committee, the executive committee is doing the job of somebody else.  The concept of subsidiarity is not understood.  This means that everybody is doing somebody else’s job.  In fact, everybody keeps doing what he was good at before he/she was promoted.

Just an anecdote.

In this supervisory board in a big retail Corporation, the founding chairman, over 75, but still active and fit, discusses on all topics concerning trade, while the Corporation has 10 subsidiaries in many parts of the world, a total turnover over 30 billions €, and more than 150 000 employees. Retail is detail.  The fact that objectives are never met, that there are other important questions, the board mostly composed of family people, talks about what the chairman wants to talk about.

The real decisions are made somewhere else.  Usually during weekends at the chairman’s home.

Controversial management

Complexity is growing, notably constrains, contradictions and paradoxes are everyday’s job.  Most managers have not been prepared for that and certainly not when they attended MBA programs.  Henry Mintzberg’s MBA programme at Mc Gill deals with such issues. Handing over paradoxes on to subordinates doesn’t solve anything.  It puts more pressure, more stress, and more anxiety. At the best it will create inhibition.

Very often the executive committee will send messages on an incantation mode.  This is particularly the case during big meetings or conventions, that are organised like shows.  Ambitious objectives, new plans, big presentations, innovations that are going to revolutionise the market, everything is done to impress and enhance the motivation of all participants. Those in charge of operations will be enthusiastic about new projects, they will be followed by the Finance VP that will explain how it plans to cut costs to make more profits.  If you look in detail, many of these objectives are contradictory.  When they go back to work managers will have to do something and its opposite.  Financial indicators go the other way than other performance indicators.  After finance, HR will come to explain a new project, new processes to assess colleagues and subordinates, and compensation plan.  Some other top executives will also add projects, with a new layer of complexity as these projects will use the same scarce resources already allocated.  This can go on for two or three days.

Separately everything is very good.

Altogether, it is very indigestible, if not toxic.

This means that every participant will pick what he thinks is best for him, or least dangerous, or more rewarding.  Management tries to reduce complexity with its own resources and its own way and as we say in French, “se débrouiller”.  Not mentioning the fact that during the months to come something new can happen, like a merger, which will put all this construction down.

A good manager should be coaching individually and collectively his subordinates to make sure that the different level of controversies are understood and in explaining the critical path to solutions.  It would be serving his team to make it more imaginative, to make it successful, without training to steal the result for him.  A good manager should keep the hard decision for himself and give the good to others.  How many do it!

Turfism or territory defence

A poor organisation will generate protective mechanisms.  Turfism means constructing walls more than bridges.  Trying to protect oneself in avoiding intrusions from other parties.  Fight for a new territory can be decided to neutralise an internal competitor or to win influence. Bastions or baronies are playing that game. Transaction cost within the organisation are high. A good example was the IS department 15 years ago.  When PCs came in, the I S. VPs struggled as long as they could to avoid the implementation of these new tools that were bringing the proper information, in the right format, at everybody, any time.  Distributed I S., is like distributed power, and like distributed intelligence.  Not everybody liked it.

Traditional fights between sales and marketing, sales and production, finance and sales, HR and finance, engineering and production, are everyday classical debates.  Corporate improvement is made at the frontier.  Most innovations in a company are cross-functional innovations.  Those who build bridges should be appraised much better than those achieving top performances at the risk of damaging their neighbour.

Poor organisers

The common saying in a company is that “we need good people to get achievements and performance”.  Little is said about other issues like organisation.  Nothing is said about the cost of achieving results, not only the financial costs, but also human and social costs.

Facing increasing complexity the rule is constant adaptation.  Corporations like organizational charts, and those charts are not flexibility prone.  Managers like to see their name in a “spot”.  They feel safe.  The need for territory is never far away.  However, the actual biological model of corporations has nothing to do with such a mechanistic approach.  Territories are more and more virtual if not cross functional.  Briefly, this means that managers must constantly rethink the organisation to redesign it and adapt to the evolution of needs internally and externally.  The same way that compensation systems must be redesigned every other year to make sure they are consistent with objectives.

When in a big discount company, purchasing managers get their bonuses on the turnover that stores make with the items they selected, it is a big mistake.  The reason is simple.  Purchasing people will buy expensive items.  They should instead be compensated on the margin that stores make out of their selection.

A good organisation must keep asking these questions:

·         Is this the organisation better for my client

·         Will this organisation bring back more information,

·         Does that organisation create internal transaction costs or facilitates transactions

·         Is this the organisation innovative and creating innovations, or creating mostly tensions

·         Does the organisation use skills and competencies at best, does it improve the work atmosphere

·         Is this organisation flexible and easy to change

·         Is this organisation compatible with the information system

  • ·        What does the personnel think of the organisation

Very often managers set in place organisations that are good for them, and make their life simpler.  Very often also this organisation do not bring all the relevant information on weak signals that may be very important for the future.  Feedbacks allow to anticipate and stay up-to-date.  One can learn a lot from incidents, or unhappy clients, dissatisfied suppliers, discontent colleagues.  Provided that someone accepts to listen to them.

Successful corporations today are those who learn faster than others, and some organisations are better at doing so.

A poor organisation is costly in terms of energy and achievements.  It generates secondary effects that are dreadful for individuals and teams as well as for the company’s climate.  Sometimes it impacts  the health of the subordinates.  It is often stressing and creating burnout.

Symptoms of a poor organisation are easy to spot: work atmosphere, low level of communication, absenteeism, dissatisfaction of clients, lack of motivation of personnel, a higher rate of turnover of managers. Changing the boss often doesn’t change the organisation.

Some toxic behaviours:

Emulation or antagonism

Some managers are very good at creating competing situations between colleagues.  Giving the same projects to two subordinates, without giving exactly the same level of information, is a good way to neutralise ambitions and make potential successor or rival disappear.  It is full manipulation.

Polluting

Some managers are good at defusing rumours in a way to create a situation that they can use at their own profit in observing how people react.

Stealing somebody else work

It happens everywhere, including in academic circles.  Those who do the job get seldom the recognition, and are deprived of notoriety and benefits.  This is clearly a lack of ethics.

Calling for criticism to identify opponents

Also a great classic.  Very often supposedly charismatic leaders ask for critical opponents to challenge their ideas and propositions.  Do not be a fool, it is an obvious manoeuvre to identify opponents and then to silent them or exclude them more easily.  Some senior executives do not like criticism.  Democracy has still a long way to go within corporations.  It is not always good to think differently.  If somebody has a critical message to put forward, he must run reformulate positively in front of his/her boss. Courage is not at the top of the list of the priorities of the management template.  This is not the least contradiction with what should be an entrepreneurial activity.

Avoiding badnagement, from each, the manager or the managed, is a good exercise. This may save a lot of hidden costs on the corporate side and some sufferings on the subordinate side. It will certainly improve transparency, motivation and trust and maybe results.

Medical practices made a big jump with the Hippocrates oath.

Is not it time that Business Schools asks graduates and manager to be, to take such commitments. After all executives are mostly dealing with people, just like doctors.

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