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Non – Linear Leadership Thinking vs. Behavior

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Once upon a time, in the land of the business gods, an epic battle was fought. B.F. Skinner challenged Sigmund Freud to a duel, the winner to take the hearts and minds of business trainers and consultants thereafter.

Skinner, as we know, beat the crap out of Freud, and ever since then the behaviorist agenda has dominated the field of business advice.

Until, that is, Roger Martin, writing in the June Harvard Business Review, writes:

…this focus on what a leader does is misplaced…a more productive, though more difficult, approach is to focus on how a leader thinks—that is, to examine the antecedent of doing, or the ways in which leaders’ cognitive processes produce their actions.

Precisely.

What do I mean by the “behaviorist agenda?” I mean unthinking recitations of, “if you can’t measure it, you can’t manage it.” I mean training objectives statements that start with, “participants will learn the behaviors associated with…” I mean “just give me the tips and tricks, skip the theory part.” I mean coaching programs that define outputs entirely behaviorally. I mean, most definitely, the question “what are the behaviors of a trusted advisor?”

The behaviors of a trusted advisor, I can assure you, are the behaviors required to be trustworthy by the particular situation. It’s the mindset behind it that drives, else it’s a Skinner box.

Martin, dean at Toronto Business School, says most leaders with exemplary records

“have the predisposition and the capacity to hold in their heads two opposing ideas at once. And then…they creatively resolve the tension between those two ideas by generating a new one that contains elements of the others but is superior to both.”

“…the process of consideration and synthesis can be termed integrative thinking. It is this discipline—not superior strategy or faultless execution—that is a defining characteristic of most exceptional businesses and the people who run them.”

He readily acknowledges this isn’t news, citing F. Scott Fitzgerald. He could have gone back to Kant, or even Plato.

But it might as well be new for today’s business world. The idea that “A and not-A” could belong together drives the average manager, b-school prof or HR trainer nuts. "It can’t be. That’s illogical. It’s crazy."

Not to regular folk. “It was the best of times, it was the worst of times.” Or, “I was never so alone as when in a crowd.” This is common literary stuff. How about, “play the ball, don’t let the ball play you,” or “to hit the golf ball, don’t think about hitting the golf ball.” Common sports stuff.

In the trust realm, I suggest the best way to sell is to stop trying to sell. Sounds like a paradox. Drives most linear people nuts (“but you can’t do that, the whole point is to sell!”).

In philosophy, it’s called thesis, antithesis, synthesis. We had a great example in this blog earlier this week. Two well articulated points of view were put forth. One argued that honesty must serve empathy—another said empathy required honesty.

Which is right? This is not a “have you stopped beating your wife” trick question; there is an answer, and the right answer is “both.”

Martin contrasts the linear, causal thinking so dominant in business today with non-linear, holistic and tension-reducing approaches. The more complex the issue, the better the quality of answer to come from this process. Think Abraham Lincoln. Or Socrates.

What’s Martin up against? Linear regression, powerpoint, process mapping, KPIs, behaviorism, decision trees, compensation systems, and other business infrastructure du jour. Skinner. The rat guy.

I’m rooting for Martin. The human guy.

Post Session Debrief

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Slideset Materials and Take-Aways:

– Look to the left on this page—under Critical Documents, click on Building Trusted Advisor Relationships to download the powerpoint slides from the sessions—they include take-aways from the sessions.

– In the same Critical Documents area, we have extracted the take-aways from each session, so you can view them separately.

 

Post-session Conference Calls:

Following are dates for our upcoming conference calls, and a request for a little bit of advance work on your part.

Schedules:

We have scheduled four 2-hour conference call sessions to provide sharing, follow-up and coaching. These calls are for participants in both sessions (London and Beijing), so they all have the same time—13:00 London time, and corresponding time for Beijing.

– Dial-in number: +31 (0) 205 110 800 (London Bridge). Participant code: 71319676#

– Charlie or Pierre or both of us will be available on all calls.

– We have made 2 hours available for each date. You do not have to be online for the whole call; check in at any point during the time slot.

– Dates:

  • 19 November 13:00 – 15:00 London time
  • 22 November 13:00 – 15:00 London time
  • 27 November 13:00 – 15:00 London time
  • 3 December 13:00 – 15:00 London time

Pre-Call Advance Work

Please scroll down to the end of this page, and add your comments about these three questions:

1. Do you have any trust success stories to tell? Any failures?

2. What has been your biggest learning since the session?

3. Is there an issue or question you’d like to ask of the group on this blog and in the upcoming conference call?

Please comment on comments made before you, particularly number 3.

Comment as often as you want; this will increase the value of our conference call.

Note: at the bottom of the comments page, you can check a box that will automatically notify you via email if a new comment has been posted. That way you do not need to waste time checking for new comments. We recommend you use it.

Now—click on "comments or questions," right below here, and tell us your preferred call date, and your responses to the advance questions.

Trust and Radical Honesty

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The July, 2007 issue of Esquire (not yet online as of this date) has a story called “I Think You’re Fat,” by A. J. Jacobs. It asks—and answers—the age-old question, what do you say when your wife asks you if this dress makes her look fat?

And that’s just for openers.

It describes writer Jacobs’ encounters with a movement called Radical Honesty; actually, with its founder Brad Blanton. And it’s a trip.

Trust Matters readers know I’ve written about honesty and lying before (most recently with Andrea Howe in Truth, Lies and Unicorns.)

But Blanton takes it to another level. Higher? Well, certainly a different level.

Blanton urges—and lives by—a very simple rule. Flat-out, no holds-barred, absolute, unquestioned honesty. About everything. Period. Open mouth, exit thought. No excuses, no caveats, no handholding, no cover-ups, no being nice. Just truth.

Author Jacobs confesses a white lie he told someone to avoid hurting that person. Blanton’s take on it: “Your lie is not useful to him. It’s simply avoiding responsibility. That’s okay. But don’t bullshit yourself about it being kind.”

Blanton’s got his own site, books and programs. He’s ex-Esalen, about 60, and a gruff hedonist, among other things. Easy to be put off by, but hard not to like. Here are some of his own words:

The heart of the message of Radical Honesty is that we can come to recognize each other as beings in common. We do this by being honest and by demanding honesty from others. This is the fundamental faith of both Radical Honesty and it’s corollary religion, Futilitarianism…Futilitarianism is about the futility of any belief whatsoever…

…beings who relate as beings, one to another, can work out the problems that come from having minds and personalities and cultural and religious and traditional differences, since those differences are all bullshit anyway! We can change how we live together by acknowledging the being we are, (nothing mysterious or mystical—just the sensate being in the body), as the universal context in which the mind occurs. We recognize each other as alike. One pathetic, mind-controlled, culturally conditioned pitiful sonofabitch, anywhere in the world, looks just about like another. Underneath all that confusing and alienating bullshit we are beings in common.

Who I am, is a present-tense, noticing being, and the idea of me—my case history and culture and values and beliefs—is secondary to my fundamental identity as a noticing, present-tense being. I can see, at the same time, that this is true for everyone else. I relate to everyone else as equals in this way. I relate to these fellow beings by being true to my own experience. This being-to-being relatedness is what allows me to make compassionate, collective decisions with my fellow cripples—I mean human beings.

Think you can justify not telling your spouse something? The white lie to your subordinate? The truth about your attraction to your office-mate?
Go ahead, test it. Check out Blanton.

You may not agree with him, but you’ll have a helluva hard time justifying why you don’t.

Does Private Equity provide a social good?

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In my circles, I find differing views about private equity. Some see it as the epitome of greed; others, as the vengeful sword of the angel of capitalism. Quite a few don’t quite “get” just what it is.

I’m temperamentally inclined to come down squarely in the middle, but I want to articulate a few positives in the bigger picture of things. Relating to trust, no less.

Private equity is now bigger than the 80s version of corporate restructuring (remember Millken and Drexel, Burham?). And, it’s still gathering steam.

Back in February, BusinessWeek was commenting on a PE slowdown. Last week, however, we read, "So far this year, the value of companies acquired through buyouts has more than doubled to $487.2 billion."

One intelligent observer, blogger Epicurean Dealmaker, raises some ominous noises.

He may be right about timing, but I also think private equity is here to stay, in a big way, and that’s not all a bad thing by any means.

First, think about what ails corporate America. Lots of things, but a few of them are sloth, bureaucracy, inertia, underpriced assets, and greedy managers who serve their own interests at the expense of shareholders. For these particular ills, private equity is a powerful solution, and one that serves society.

PE at its best, that is. It’s also true that a whole lot of PE is just re-leveraging companies and sucking fees out of them, without doing fundamental fixes. And debt levels are way up for today’s deals. Still, that’s hard to get too worked up about; if there are crashes in the PE world, the pain will be disportionately visited on gunslingers in zipcodes like 06830.

Second, private equity also forces the issue of regulation. Some argue that Sarbanes Oxley is prohibitively expensive for public companies, hence companies are far more efficient if taken private. That smacks of ex post facto rationalization, but never mind; the issue is valid enough. Unlike some societies, we have an escape valve for bad government regulation.

A more fascinating peek at the social engineering issues it raises is the recent post from the delightfully vicious Equity Private . Nobody can bemoan like her the encroachment of HR and PR into the heretofore merciless realm of the private equity long knives. She could make you feel bad for Atilla the Hun.

She’s got a point—PE is big enough business now that its Gekkos are worried about softening up their image. So the pressure isn’t just to ease up SarbOx on the public side, it’s to ease off the Darth Vader thing on the PE side. Classic socio-political compromise, writ large.

But there’s one more way in which PE is a net plus. The world economy is doing two things: getting more linked, and getting more outsourced. That means more links between companies, rather than within them. It gets easier to have the world expert in XYZ do that for you, while you focus on being the world’s best at ABC. Transaction costs will be externalized, to get all economist on you. The world will get better at horizontal, linking relationships, replacing vertical lines of command and control.

That means the world is moving toward breaking companies up, not putting them together. Which means trust will be a key business success factor. Another long-term reason why PE plays a net plus role.

And as long as I’ve got my financial hat on, I might as well point out that on May 21 I suggested it was a good time to go short a few stocks. Not that you should trust me on investments; even a broken clock tells time right twice a day. I’m just sayin’.

How Marketing Can Destroy Sales Trust

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I like to believe there can be professionalism in sales.

So I was struck the other day when I ran across an article that talked about “selling on message.” (Pharma Voice, May 2007).

It has always seemed a curious phrase to me—sort of the opposite of customer focus.

Who talks that way? The three Ps, it turns out—that’s who.

The first P is politicians. Robert S. McNamara, Secretary of Defense during the Vietnam War, gave this advice for dealing with the press: “Never answer the question they ask; only answer the question you want to talk about.”

McNamara’s view has since been echoed by Clinton (“it’s the economy, stupid”) and by Bush ("it’s 9/11, stupid!"). Good politics? I’ll defer to others. But it sure isn’t trust-enhancing—look at pols’ polls.

The second P is public relations and marketing. Google “selling” with “on message” and you get “A major concern for marketing and sales executives is that they are always ‘on-message’ with all of the communications that reach their prospects and customers—helping to create, establish and build a customer relationship that will ‘competition-proof’ their customers.”

This seller-centric view of sales comes from a self-described “provider of sales-oriented public relations and marketing services—” which, ironically, lists a “customer-centric selling program” as a key client.

Another source from the same search says, “Less than 27% of CMOs report confidence in having adequately prepared sales to be on-message,” and "How do we enable salespeople to be “on-message” and empower marketers to do what they do best? "

(Those darn salespeople, always wandering off to what customers want to talk about, when they should be doing marketing’s bidding.)

This helps explain the third P, which is the pharmaceutical industry. The article quoted at top, “Sales Training: Moving Beyond the Message,” says “it’s become vitally important for sales representatives to provide value beyond the marketing message.” It quotes Peter Sandford, “in the regulated healthcare environment in which we work, selling on message is vital, but it is the additional knowledge that the representative has that can also be useful to the physician. This allows them to essentially sell beyond the message, but still within the guidelines.”

A May, 2006 article in the same publication called “Rebuilding the Trust—Sales Managers Lead the Charge,” says, “… representatives need to differentiate themselves by delivering more distinct messages, tuned to the needs of the healthcare providers they’re dealing with. They also need to better understand what creates value and align the messages with that goal.”

All this is the language of a sales culture and community that has been mugged and drugged by marketing. Only in such a business can it actually sound radical to suggest that salespeople give customer-specific attention, as opposed to staying “on message,” or “within guidelines.” You don’t hear this kind of talk at IBM, or Nordstrom’s, or Starbucks, or Goldman Sachs.

Marketing is, by its nature, a monologue—it tells things people want to hear to the people who want to hear them.

Sales is, by its nature, an infinitely customized dialogue.

Nothing wrong with either one. Each has its place. But they are different.

When sales is overly-subordinated to marketing, you emd up with “selling on message.” Kind of like the stereotype of telemarketing, or scripted sales businesses like ballroom dancing, or pump-and-dump brokerage houses. It can create puppets reading canned speeches, or at least feel that way, because—the "message" is, above all, about the seller.

The folks at PharmaVoice are right; they are doing their bit to drag pharma sales (forward) into the late 20th century. It must be the most sophisticated business in which marketing chokes off oxygen to sales.

I suppose this is because in recent years pharma—for a variety of structural reasons—has come to be dominated by the marketing function. It has tended, then, to frame other issues—customers, trust, selling—in terms familiar to marketing and PR.

More’s the pity. Marketers do not help the trustworthiness of sales reps by urging “selling on message,” and trust isn’t something the pharmaceutical industry is long on right now.

Now, about McNamara…

The First Carnival of Trust

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Carnival of Trust logo

Welcome to the First Carnival of Trust.

I’ve been very gratified by the quality of the posts I had to choose from. It’s not easy to pick just ten, but that’s what we promise you—the ten most interesting, provocative, thoughtful blog postings within four broad categories of the subject of trust: Advertising and Influencing, Sales & Marketing, Leadership & Management, and Strategy, Economics & Policy.

Of course, interesting/provocative/thoughtful are subjective categories—but that’s the fun of it too. You can discern my angles and add your own pinches of salt.

I’ll be hosting the first few carnivals (first Mondays of the month) as a shakedown cruise; thereafter the Carnival of Trust will be hosted by some great bloggers with their own tastes and points of view.

Enjoy.

Trust in Advising and Influencing Logo

At the intersection of truth-telling and sincerity, Penelope Trunk talks about the fine art of giving compliments. There is much at stake…

We (including Trust Matters) often speak of trust as a noble form of connection, finding common ground between otherwise-different people. But what about trust as simply favoring those who are most like us? What’s the difference between trust and racism? Thoughtful analysis, as always, from David Maister at Passion, People and Principles.

Trust In Sales and Marketing Logo

The paradox of trust is never more evident than in sales. The best way to sell is to stop trying to sell. Natalie Ferguson at Simple and Loveable explains how it works in The Anti-Sales-Pitch.

Twenty-five years ago, Johnson & Johnson made the world’s best investment in PR. That wasn’t their intent in responding to the Tylenol poisoning incident; but it was one of the effects. Leon Gettler explains why in Six Rules to Avoid PR Disasters…

The link between brands and trust is strong. Jonathan Schwartz, CEO of Sun Microsystems, explains why dependability—the idea of a promise—is mere table stakes for a brand. The real power of branding is that it’s “a cause that gives definition to the ill-defined.”

Confidentiality? Competitive intelligence? Need-to-know? When it comes to important information, what’s the right default stance: treat information as secret, or make it easily available? Carmine Coyote at Slow Leadership explores the cost of excessive secrecy.

Speaking of Jonathan Schwartz, how many CEOs write their own speeches? Draft their own articles? Write their own ad copy? Not too many. So are blogs any different? Luis Suarez at ELUSA explores the question.

Trust in Strategy, Economics and Politics Logo

The I/B/E/S database tracks stock analysts’ recommendations. Researchers tracked the period 1993 – 2002—twice; once in 2002, and once—with corrected data—in 2004. By 2004, about 15% of the data had been “corrected” by securities firms. Wanna guess if there were any patterns to the ex post facto corrections by Wall Street? Mike DeWitt at BusinessPundit is shocked—shocked!

Some writers have suggested that business school cheating scandals highlight the dark side of collaboration—that it’s hard to distinguish from cheating. Rob, at BusinessPundit, is having none of it. Decide for yourself.

Speaking of Tylenol—what happens when you do everything you can possibly imagine to prepare for a difficult situation—and life still throws you a curveball, and you get skunked again. Michelle Golden at Golden Practices explains why the folks at Intuit must have been going to school on J&J’s response.

My Client is a Jerk: Three Keys to Transforming Relationships Gone Bad

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(Following is an abridged and partial version of my latest article just published at RainToday.com)

Have you ever had a really difficult client?

• Who won’t take the time up front to share critical information
• Who just cannot make a decision,
• Who is frozen by politics or fear or ignorance,
• Who argues, rejects, and is disrespectful.

There is a common thread to all of these cases, which—if we understand it—can help us succeed.

The common thread has nothing to do with the clients.

The common thread is us.

The Client Situation

Let’s get some perspective—about our clients, and about ourselves.

We’ve all said, if only in our heads, "My client is a jerk." Unfortunately, "my client is a jerk" is a terrible problem statement. For starters, clients don’t usually buy into it.

People successful enough to hire us typically have achieved some degree of success in life. While it’s popular lately to describe the prevalence of "a**holes" in business (see Robert I. Sutton’s book, The No A**hole Rule: Building a Civilized Workplace and Surviving One That Isn’t), their frequency is overestimated.
Most clients have spouses, or parents, or siblings capable of loving them. Most have a boss who has promoted them.

Truly bad behavior, more often than not, comes from decent people who are stressed out. If someone is behaving badly, it’s a good bet that they are afraid.
Identify the fear, and you can find a real problem statement.

Manage to talk about that fear with your client, and you can create a lasting bond.

Our Own Situation

What’s true of clients is equally true for us, especially in selling. We fear not getting the sale.

We’re afraid of our boss, peers, loved ones and clients judging us.

But we carry the ultimate judges around in our own heads. We allow ourselves to be hijacked by our own ideas of being "good enough.” There’s a thin line between having high standards and beating up on oneself.

If we act from fears, we will run from judgment—usually by blaming others. “This sale was doomed because I had a difficult client. If you’d had my client, you would have failed too. My client is a jerk.”

At first blame, people will commiserate with you. But when blame turns into resentment, people move away. Misery may love company, but company doesn’t return the favor.

Blaming a client never got you the sale, and it never will. But it can kill the next one.

Self-Diagnosing and Fixes

For more on diagnosing the problem (and examples of reframing it), and for three fixes for difficult clients situations, read the rest of the article at RainToday.com.

There aren’t any difficult clients. Not really. There are only relationships that aren’t working well. And nearly all of those can be fixed. But it must start with us.

As Phil McGee says, "Blame is captivity; responsibility is freedom." To get free of "difficult clients," take responsibility for fixing the relationships.
 

Trusted Transactions – Credit Card Processing

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Loyal Trust Matters reader Jim Bullock is author of maybe the best piece I’ve seen on the structure of negotiated contracts. It’s called “Chinese Contracts,” and I recommend it.

But Jim has a recommendation of his own to make: a small credit card processing business in Seattle.

Now turning blog control over to Jim…

Charlie, I came across a company I think you’d appreciate. Called Gravity Payments, they do payment processing for small to medium sized businesses. They are growing like crazy & profitable. They are interesting because of the way they do business.

Payment processing statements are opaque. The industry is built around a pretty big assumed churn, and a pretty high advertising- and marketing-driven cost of new customer acquisition. By offering transparency, essentially some consulting on what it all means, and limited guarantees on cost of service, Gravity Payments has much lower churn, and essentially word of mouth driven marketing leading to much lower costs of sale.

Because this gives them a typically longer (and I suspect less costly) relationship with each customer, they can charge less.

Thus, customers move over because they are dissatisfied with their previous service, and now can feel cared for. Then they stay forever because they also save money.

I haven’t given the trust aspect of this business enough play, nor have I done justice to how the need to be fair and do right shines out from the remarkable young founders of this company. I saw these guys at a business plan competition I went to (they took second place).

The thinking behind the business is crystal clear. I wasn’t expecting to find a couple guys trying to do well by an under-served segment, there in among the sharks.”

[Charlie re-taking blog control]

In an article on the founders – I’m struck by this:

Price says he and Gravity’s employees feel passionately about local businesses, saving their customers over $1,000 per year depending on the size and revenue of the business.

How does Gravity Payments choose employees? Currently employing 15 full-time employees, Price attributes their excellent staff to choosing employees using the method of axiology.

Axiology is a "branch of philosophy dealing with ethics and values." The Price brothers applied this idea to Gravity, taking a person and fitting a job to them rather than fitting the person to a job.

This attitude toward employee management is apparent as an integral part of how the Price family applies their values in the business world. Axiology was introduced to Dan and Lucas by their father, Ron Price. Ron Price is an organizational consultant working through his own business, Lifequest. His clientele include Hewlett Packard, Pacific Steel and Recycling, and First Bank of Idaho.

Axy, smaxy, whatever. Sounds like it works, and one can see why.

Thanks Jim for another case of the paradox of trust: do right by your customers, and they’ll do right by you. As long as you make it the outcome, not the goal.

 

Who Should You Trust on Trust in Business: Yankelovich or Fortune?

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Whom do you trust on the subject of business trust?

Before I give you any data: write down which you’re most inclined to trust on the subject:

a. Daniel Yankelovich, doyen of opinion research, who says trust in business is down these days;

or,

b. Fortune Magazine, who says trust in business is up these days.

Here’s what each has to say.

Fortune, April 30, says:

the big picture showing a broad business return to a respectable role in American culture is undeniable. Americans today trust business far more than at any time in recent years, at least by some measures. A new poll from the New York City-based Edelman PR firm, the latest in a series conducted since 2001, shows the highest level of trust in business that the poll has yet recorded: 57% say they trust business to "do what is right." That’s even higher than in the palmy days before the Enron scandal broke.

By contrast, Daniel Yankelovich, interviewed in McKinsey Quarterly (subscription only), says:

A lot of business people are under the impresion that because there isn’t as much talk about the scandals, mistrust of business has receded. Research shows the opposite: the lack of trust in business has grown. At the peak of the scandals—say, in 2002—36 percent of the public agreed that you could trust business leaders to do what is right most of the time or almost always.

Since the scandals now seem to be behind us, you would think that the level of trust would rise. Instead, it fell to 31 percent in 2004, and to 28 percent in 2006. So there’s a continuing erosion of trust.

[we’ve had] three waves of mistrust in business and other institutions over the past 75 years…the other two waves lasted about 12 years, and we are now in the 5th to 6th year of this one…you shouldn’t be misled by the lack of media attention to the scandals, because the mistrust continues to grow.

There. Now that’s cleared up—what can we conclude?

1. Surveys depend strongly on how one words the questions
2. That’s especially true for terms like “trust.”

To find out the answer, we turn to you, dear readers.

What do you think? What has happened to trust in business in recent years?

Call for Submissions For the Carnival of Trust

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Carnival of Trust Logo

I’m starting a blog carnival on the subject of trust, and wanted to make sure you were aware of it.

As you may know, it’s a subject near and dear to my heart. I believe trust is an increasingly important element in a business world and a society that is becoming more dependent on connections, yet more and more removed from the high-touch interpersonal connections of old. A higher-trust society is a society that is personally healthier, and also economically richer. Not to mention probably more peaceful.

My hope and ambition for the carnival is to begin establishing a home base, a center of gravity, for people who are interested in fostering greater trusted relationships in various realms of the world.

While my own material is primarily business-oriented, the Carnival of Trust will be explicitly more broad than business alone. Trust is heavily personal in nature, and I hope the submissions will reflect that—postings that deal with personal trust, business trust, and political trust are welcome, as well as pieces on the nature of trust.

I’ll be setting a hard limit of 10 postings per Carnival. The host will personally make the decisions about inclusion, in an inevitably subjective manner intended to push the thinking ahead in those broad areas of trust. I’ll be hosting the first few carnivals, and while quality is the main criterion, I’ll be looking for breadth at the outset as well.

I invite, encourage and urge you to submit pieces for the Carnival. Send them to http://blogcarnival.com/bc/submit_1693.html . The deadline is Thursday May 31st, the
carnival itself will go up Monday June 4th. On an ongoing basis, the Carnival will appear on the first Monday of the month, with submissions due the preceding Thursday.

I look forward to hearing from you!