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My boss is bad: Organisations, CEOs, staff – they’re all victims

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Leadership

Chetan Dhruve continues with his series looking at issues with leadership, this time concluding that bosses, in the final analysis, are victims of the system too.


Imagine you’re in hospital undergoing treatment for something serious. Understandably, you’re anxious. Above all else, you don’t want someone to make a mistake. And you have good reason to be anxious: medical errors kill thousands of people every year. The odds of dying in a hospital in the developed world because of mistakes are a horrifying 33,000 times higher than the odds of dying in an air crash, according to this Guardian article.

But if a health professional knows a medical error is being made, you’d assume that at the very least, the individual would speak up. Does this happen? Let’s look at research by Harvard professor Amy Edmonson, who studied how leadership and co-worker relationships affected drug-treatment errors in nursing units. Understandably, Edmonson assumed that better leadership would mean fewer mistakes.

Stanford professor Bob Sutton quotes the study in his book, the ‘No Asshole Rule’. The study’s results were astonishing – Sutton writes: “Units with the best leaders reported making as many as ten times more errors than the units with the worst leaders.” In short, better leadership seemed to produce far more mistakes. What on earth was going on?

“Bosses and other staff may not even realise mistakes are being made and everyone loses in the end.”

Edmonson realised that, in fact, the nurses in the best led units reported more errors because they felt safe enough to admit mistakes. The nurses said: “You are never afraid to tell the nurse manager”, and that the manager created a psychologically safe atmosphere in which to work.

In sharp contrast, fear was rampant in units that rarely reported mistakes. Nurses said: “The environment is unforgiving; heads will roll”, or “you get put on trial”. Naturally, in this intimidating atmosphere, people worry about their own jobs rather than bring trouble upon themselves.

The larger point is, while patients and their families suffer, this ultimately impacts the doctors and the hospitals themselves. Bosses and other staff may not even realise mistakes are being made and everyone loses in the end – the patients, the nurses, the doctors, and the hospitals.

On a less frightening note, let’s take the health of the economy – because there’s a lesson for us there too.

The economy takes a beating

If you own a home, chances are that its price is dropping. If you want to own a home, it’s going to get tougher to get a mortgage. For this situation, blame the downward trend in the real estate market, in turn triggered off by the sub-prime crisis in the US.

How did this come to pass? Sub-prime mortgages – mortgages sold to people who couldn’t really afford them – resulted in an inflated housing market. Ergo, house prices went up. When payback time came, the borrowers couldn’t pay. Ergo, the market went down. And now that there’s a crisis, the banks are getting tougher about whom to lend to.

The firms hit by the sub-prime crisis include some of the biggest and best-known names in the business – Northern Rock, Barclays, Citigroup, HSBC, Morgan Stanley and Merrill Lynch. The financial services sector is taking a terrible beating, in the region of perhaps hundreds of billions of dollars. This is no picnic.

Many of the CEOs have lost their jobs, including Adam Applegarth (Northern Rock), Charles ‘Chuck’ Prince (Citigroup), and Stan O’Neal (Merrill Lynch).

Now, these organisations employ thousands of smart people. Surely, surely, several among those many thousands knew something was badly wrong? So why didn’t they speak up?

Consider the attitude Northern Rock’s CEO, Adam Applegarth. According to an article in the Daily Telegraph, an observer said: “He [Applegarth] had a habit of asking people who their top five fast bowlers were. And when they gave their opinion he would fire back that they were wrong and the real answer was X, Y and Z. Those who disagreed with Applegarth or questioned his decisions were brushed aside.”

“These organisations employ thousands of smart people. Surely, surely, several among those many thousands knew something was badly wrong? So why didn’t they speak up?”

The Telegraph article added: “A banker once questioned Adam on his business model. Applegarth retorted that he clearly didn’t understand the model or the business. That banker was ever after a persona non grata.”

When a top ‘leader’ has an attitude like that, is it surprising that the truth never gets revealed? Moreover, subordinates have much to gain by keeping quiet.

Here’s what a banker friend of mine had to say, when I asked him about the crisis: “Everyone colludes in this because they are all motivated by profit maximisation – their own. Trying to have stock that vests over three to five years does not really solve the [short-term mentality] problem because often the bull run [the good times] will last that long. This means even if they leave after a while, they have made more than they would in a lifetime in another job. There is very little downside risk and people are not stupid (or they choose to be so!).”

Indeed, there is very little downside risk for those who are lucky in getting out at the right time. But in the longer term, everyone – the CEOs, the banks, the employees and the bosses themselves – suffers when everything turns into a giant shipwreck, taking the economy down with them.

It’s all down to the system

Let’s look at all this in ‘systems’ terms. Which system is great at shutting up people? You guessed it: a dictatorship system. HealthGrades, an American healthcare ratings organisation, stated that 195,000 people die per year in the US because of in-hospital medical errors. One of the reasons for this is that “our culture has typically viewed medical errors as a failure of people rather than systems, which prevents reporting and consequent analysis and solutions to prevent it from recurring”.

What’s the one thing, by far, that would prevent the reporting of errors? In a word, fear. In contrast, what system would enable the reporting of errors? A free system. You may think this is far too simplistic, but there’s nothing simplistic about freedom. Think about it the next time you or a loved one (heaven forbid) have to undergo a stint in hospital, or someone’s trying to sell you a dubious mortgage.


Read Chetan Dhruve’s other articles:
My boss is bad
My boss is (still) bad
My boss is bad: Are you a victim?


Chetan Dhruve is the author of ‘Why your boss is programmed to be a dictator’ (published by Cyan/Marshall Cavendish). You can contact him at: [email protected] or visit his website at www.cvdhruve.com.

8 Responses

  1. Response to Yuva
    Yuva,

    Thank you for your comment.

    In talking about the system, I am talking about a very specific definition of the word ‘system’ – a dictatorship system is one in which you aren’t allowed to vote for your boss, and a “free” system is one in which you do vote. (For a more detailed explanation, please read my earlier article at http://www.hrzone.co.uk/cgi-bin/item.cgi?id=173077

    My point is that a dictatorship “fear” system enables bosses to behave badly and take bad decisions. In that sense, the system enables bad things to happen. If you are a dictator, chances are you will behave dictatorially. Hence, it’s the system that’s at fault, not the individual.

    In my opinion, your previous boss could manipulate the system because the workplace system is built wrongly. That the system is wrongly built is not your boss’s fault. Obviously, at some point, organisations will all have to take responsibility to change the system.

    Yes, you can have the best of systems and still have a bad boss. Nothing is perfect – all we can do is to increase the probability that a bad boss will be caught. And that is far more likely in a free system.

    Our best hope lies in choosing a good system and improving it, rather than sticking with a bad one and blaming individual bosses.

    (Disclosure: I am the author of the above article)

  2. Interesting thread.
    How often have we blamed the “system” whenever something goes wrong!. For years on I have not taken too kindly to this line of thinking because in the end, is it not the very people or that unilateral decision maker called BOSS (Dictator or otherwise”) who is the main architect behind the creation and perpetuation of the “System”.

    I am not so sure where the message in the article is heading, but my take on “excusing” CEOs as victims is a little difficult to swallow!. I am talking from an experiential perspective and having paid sufficient price in the learning curve!

    Allow me to qualify that my reference of a Boss is that person who has the Responsisbility, Authority and Accountability!
    He may delegate or empower the first 2 but certainly not the last.

    In the military they say there are no bad soldiers, only poor leaders. Similarly, I will allude in the corporate world, there are no bad staffs, only poor Bosses. They could be HODs, CEOs, MDs and even the Shareholders as a whole.

    At the end of it, as Stephen Covey says, don’t blame the circumstances for your response. One can only choose to be a Bad Boss. If you don’t have the faculty to distinguish between what is good from bad, then you need to do some soul searching before you continue to make others suffer in silence.

    I left my previous company because the CEO was a “Bad Boss”. Yes, he manipulated the “system” for his own self interest. Yet, the “Audit” system failed to detect. The guy is still the CEO and people do work for him. Does that make him to be, a Bad boss?. Yes, in my book it does because he abused his position and compromised his integrity. But not as far as the MD or BOD is concerned because their interest is more short term, bottom line and lag results driven.

    You can have the best of systems and yet all it takes is a Bad Boss to foul things up. Similarly, if you have a bad boss you can only expect a bad system. Does seem like the chicken and egg story!

    So how do Bad bosses come into the picture?. Are they natured or nurtured?. Is it one of systems sophistication or matter of choice -keep or fire.

  3. Systems solutions
    Harvey, thank you for your comment.

    While both the airline and healthcare industries may have ‘near miss’ reporting systems, the system I am talking about is the boss-subordinate relationship itself. This ‘system’ forms the bedrock of the vast majority of organisations. Currently, this system produces fear (for the subordinate), which results in either dishonest or watered-down answers. Until this system is fixed, the other systems that are put into place only address the symptoms, not the cause.

    You’ve earlier commented on Rebecca Young’s question on appraising her boss, in which she’s said, “I feel uncomfortable doing this and if I had any criticisms I would be afraid to say so.”

    (see http://www.hrzone.co.uk/cgi-bin/item.cgi?id=161118&d=101

    Another person who commented was Steve Lloyd, who said, “my answers were used against me and my life was made a misery.” In fact, virtually every respondent to Rebecca’s question said in some way, “be careful”.

    Why did Rebecca feel afraid? Why was Steve’s life made a misery? Why should we have to be careful when we want to tell the truth about our bosses? Why do error reporting systems have to be anonymous?

    Simple – because the system at our offices is a dictatorship system. So the point is, regardless of what error reporting system we have, if the underlying system doesn’t produce freedom, the reporting systems don’t go far enough in terms of getting people to report errors or tell the truth.

    (Disclosure: I am the author of the above article)

  4. Systems solutions for doctors in the UK
    The airline industry has its ‘near miss’ reporting system in which pilots can anonymously report situations that may have proved fatal, so that others can learn from that experience and avoid a repeat.

    Similarly, there is a reporting system through which concerns about doctors can also be reported in the NHS, to protect patients.

    Also, in Patricia Hewitt’s White Paper published last February (the “Safer Doctors” one) all doctors will be required regularly to undergo multisource feedback (360). For Consultants this will be part of the 5 yearly revalidation (re-licencing for fitness-to-practice) process. Similarly, doctors in training will also go through 360 at regular intervals as a part of routine appraisal – typically 6 monthly intervals in F1 and F2 stages of training.

    Drug manufacturers working with NHS procurement staff are also using a systems approach in designing out the potential for mistaken selection of drugs through packaging and labelling changes. Human error is taken very seriously in the NHS……although stories about inaccurate weighing scales recently hasn’t helped public perceptions.

    Corporate and Clinical Governance at NHS hospitals is high on board agendas but, like the airline industry, you do get the occasional “spectacular”.

  5. Airline safety vs hospital safety
    Jeremy, thank you for your comment. I think the airline industry is particularly able to have a laser-like focus on mistakes and safety (unlike say, hospitals) because flying appears such a dangerous and unnatural thing. Hence, the industry has to continually re-enforce the message to its customers that flying is safe. That’s also why subordinates are able to “get away” with reporting mistakes, because a single uncorrected mistake can result in a spectacular and news-worthy air crash. Even if there are “only” ten air crashes in a country per year, the airline industry will take a mortal blow. In contrast, people routinely die in hospitals, but because hospitals don’t look “unnatural”, there’s no real need to court ‘customers’ by emphasizing safety. Hence, it’s easier to shut people up.

    Having said that, the world’s worst aviation accident, in which over 550 people died, took place (in Tenerife/1977) when two jumbo jets collided on the runway. It later turned out that the captain of one of the planes had tried to take-off, after over-ruling a subordinate who doubted if the runway was clear.

    I also completely agree that no one is perfect – hence the need to ensure that we have the right system in place – a system in which people vote for their leaders.

    (Disclosure: I am the author of the above article)

  6. Bad boss
    Don is absolutely spot on when he says that it’s often the manager who should be called to account and not the supposed “offender”.

    Currently, blame is put squarely on the subordinate for poor performance, even though the manager may have played a massive role in that underperformance by way of poor management.

    The only way of ensuring accountability for managers is to change the system by having subordinates vote for their bosses – to ensure the creation of a genuinely free system.

    (Disclosure: I’m the author of the above article)

  7. Blame cultures?
    Yes, a great article and well done Chetan!

    I might quibble about the use of the word ‘victim’ – Trans-Actional Analysis and many other valuable models have much to say about this as a professional term of art, especially when coupled with ‘rescuers’ etc!

    But meanwhile – I applaud the accepted practices and great example of the international airline industry here. Better to claim a fault or near-miss than hide it for fear of punishment! This has proven to be invaluable to ensure flight safety and is an attitude of mind I know many in the health services in particular would dearly like to espouse.

    Maybe health services are some way off this ideal yet, and most businesses for sure, but it is surely an invaluable model for all organisations to embrace?

    Thinking of Trans-Actional Analysis in particular, we have to recognise none of us may – or can – be ‘perfect’! (And note, this is not to deny either personal accountability nor reponsibility?) But for sure, we won’t learn from others’ mistakes in any culture that rewards cover-up and collusion for the sole avoidance of blame and retribution.

    As Chetan suggests – clearly a Leadership Issue first and foremost; and also a Societal one?

    Sincerely

    Jeremy

  8. Bad boss
    Another thought provoking article……..and in the same week. Well done HR Zone.

    The same/similar situation applies in a huge number of situations relating to poor performance. In the instances cited, what about those on the boards of Citigroup and HSBC etc?? I don’t know about commerce laws in the UK, but in New Zealand we have recently toughened up laws relating to whether or not directors have to accept scrutiny when things go wrong because they allowed a CEO to embark on some dubious “moving forward” activity. [Whatever happened to that nice word “future”?] Often when I am asked for assistance in dealing with under-performing team members, I find the very person asking for the assistance, the manager/team leader, is the one who should be called to account and not the supposed “offender”.

    Wouldn’t it be great if senior managers were to read these articles and respond other than by stating that it could not possibly be them!!!!!!!!! Cheers.

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