Tag Archive for: Sidebar: Charles H. Green

This blog writes about matters of trust: usually from the perspective of the one who would be trusted or trustworthy. What about the flipside; when we ourselves are the ones doing the trusting?

David Maister has a provocative post on that subject, called “Can we be manipulated?”

He cites a new book, a recent Wall Street Journal article, and his own honest assessment that some of the potentially manipulative techniques outlined in the book are indistinguishable from the techniques that might be used by someone acting as a true trusted advisor.

Comments on David’s excellent posting are also worth reading. I want to sharpen the issue and add my two cents here.

As David puts it: how susceptible are we to those with high skills and low motives? What can we do to make ourselves less susceptible—less likely to trust the untrustworthy?

There are basically two generic solutions—you can see them played out in the comments to his post. One lies in exploring the other person, and one in exploring ourselves.

The first examines the other’s motives. Put simply, what’s in it for the other guy? If the answer isn’t clear, ask questions; if they’re not forthcoming, ask why. If the answer is too good to be true, it probably is. And so forth.

This isn’t about skepticism, but curiosity. If the issue is money (and it often is), it’s important to understand the other’s business model. “An investment that guarantees you a nine percent return? Hmmm—help me understand how you do that.”

The second solution lies in understanding ourselves—especially our weaknesses. What are we afraid of not getting, or of losing? What are we unconfident about, or threatened by?

Self-knowledge improves our gut instincts, but even more helps us listen to the gut instincts we already have.

Sacha Baron Cohen’s alter ego in Da Ali G Show (the rap version of Borat) had, to my recollection, only two encounters with people who refused to buy into the joke—Donald Trump and Newt Gingrich. Say what you like about those two, but their self-confidence is high enough to make them bullet-proof to the practical joker. Each in effect said, “if you’re real, you’re an idiot and I’m not buying in. If not, then your joke is boring and I’m busy, goodbye.”

Mark Twain wrote about The Man Who Corrupted Hadleyburg—a 19th century version of Borat, holding a mirror to a town that thought it was incorruptible. It became thoroughly corrupted not because it was corrupt to begin with, but because it thought it wasn’t.

Of course, when it comes to trust, there are no guarantees. Trust lies in that interesting territory between blind faith and calculated risk-taking.

My unscientific sampling says many people make New Year’s resolutions, but few follow through. Net result—unhappiness.

It doesn’t have to be that way.

You could, of course, just try harder, stiffen your resolve, etc. But you’ve been there, tried that.

You could also ditch the whole idea and just stop making resolutions. Avoid goal-failure by eliminating goal-setting. Effective, but at the cost of giving up on aspirations.

I heard another idea: replace the New Year’s Resolution List with a New Year’s Gratitude List. Here’s why it makes sense.

First, most resolutions are about self-improvement—this year I resolve to: quit smoking, lose weight, cut the gossip, drink less, exercise more, and so on. All those resolutions are rooted in a dissatisfaction with the current state of affairs—or with oneself.

In other words: resolutions often have a component of dissatisfaction with self. For many, it isn’t just dissatisfaction—it’s self-hatred. And the stronger the loathing of self, the stronger the resolutions—and the more they hurt when they go unfulfilled. It can be a very vicious circle.

Second, happy people do better. This has some verification in science, and it’s a common point of view in religion and psychology—and in common sense. People who are slightly optimistic do better in life. People who are happy are more attractive to other people. In a very real sense, you empower what you fear—and attract what you put out.

Ergo, replace resolutions with gratitude. The best way to improve oneself is paradoxical—start by being grateful for what you already have. That turns your aspirations from negative (fixing a bad situation) to positive (making a fine situation even better).

Gratitude forces our attention outwards, to others—a common recommendation of almost all spiritual programs.

Finally, gratitude calms us. We worry less. We don’t obsess. We attract others by our calm, which makes our lives connected and meaningful. And before long, we tend to smoke less, drink less, exercise more, gossip less, and so on. Which of course is what we thought we wanted in the first place.

But the real truth is—it wasn’t the resolutions we wanted. It was the peace that comes with gratitude. We had mistaken cause for effect.

Go for an attitude of gratitude. The rest is a positive side-effect.

Postscript: the article in the NYTimes on 7 January titled Happiness 101 suggests that gratitude is the most effective "strategy" of many studied in engendering happiness.

This comes in two parts: generic and specific. ABC and 20 Questions.

The generic tip is “always be curious”—ABC.  If you’re always curious, you’ll ask good questions. You’ll have to develop some hypotheses in order to come up with questions. You’ll develop insights. You’ll be market-focused, rather than inward focused—always a good place to focus first.

But most importantly, your self-orientation will drop.  Self-orientation is the biggest factor affecting personal trust—if your objectives, goals and focus is on yourself, then to that extent, customers and clients won’t trust you.  As well they shouldn’t.  Being constantly curious transforms self-orientation into customer focus.

The tactical part is the list of 20 questions.  Always have a rolling 20 question list about your client and your customer on hand.  Keep them in a notebook, in your to-do list, in a separate client info/data file.

Keep the questions genuine—questions that you honestly don’t know the answers to, and the knowing of which would add to your knowledge of the company and its issues.  Don’t use gimme questions that you could have looked up; make them richer questions, ones requiring insight or perception.

Now put the two parts together.  At every client interaction, be curious by asking one or two of your questions.  There’s no need to be coy about it—you can tell your client exactly what you’re doing and why. Top up your questions list a day or two later, so it’s always a rich one.

The trick, I think, is discipline in doing it.  This is not a tip that delivers results by thinking about it; you actually have to do it.

And so now I must confess: I’ve been suggesting to people for some time that they do this, and I haven’t been doing it myself.  I don’t like making New Year’s resolutions, but I think I’ll make a December 28 resolution.

I’ll report back to you in a few months on my results.  I’d love to hear yours.

The Coca Cola company, with Nestle, is test-marketing a new product called Enviga. It’s being marketed as “the drink proven to burn calories.” It also raises some high-stakes trust issues for Coke, the food business, and business in general.

"Enviga is a great tasting beverage that invigorates your metabolism to gently burn calories, and it’s a positive step people can take as part of a balanced lifestyle – like taking the stairs."

—John Hackett, senior vice president, Coca-Cola North America Marketing

“In no way, shape or form are we suggesting that Enviga is a weight loss beverage.”

—Dr. Rhoda Applebaum, Coke’s chief scientist

Hmmm…

"Many consumers are going to see the term ‘calorie burner’ and think it means weight loss."

—Parke Wilde, director, food policy and applied nutrition, Tufts’ nutrition school

“It’s ironic that Coke, a company that has been a major promoter of weight gain, is now pretending that it is coming to the rescue of overweight people,” said CSPI executive director Michael F. Jacobson. “Plain old tap water has zero calories, five calories fewer than Enviga, but unlike Enviga, tap water doesn’t cost 15 bucks a gallon.”

2003, Coke’s then-CEO:

"The Coca-Cola Company has always been fundamentally in the relationship business, and trust is at the heart of every relationship our Company has ever developed. Consumers trust that they’ll be refreshed by the highest-quality beverage. Customers trust that we’ll provide the highest level of service and attention to their needs. Our bottling partners trust that we’re operating in the best interests of the Coca-Cola system. In short, when you’re fundamentally in the relationship business, trust is the essential first condition. But you can’t demand trust—you have to earn it."

—Conversation with CEO Doug Daft, 2003

Here’s an example of what’s at stake:

Coca-Cola has been voted as one of the most Trusted Brands by Reader’s Digest -celebrating its 52nd year in India in the Reader’s Digest Asia’s Trusted Brands Survey 2006. Coca-Cola in Asia has been voted as a ’Platinum Winner’ and Coca-Cola in India has been voted as a ’Gold Winner’.

Trust is indeed important for a company like Coca Cola—moreso than perhaps they realize. Parse Daft’s statement on trust and you’ll find it wanting—except for the line about bottling partners, it’s indistinguishable from a generic "we provide best quality products and services" statement. Daft uses "trust" as a synonym for expectations—a pretty narrow definition.

For a global company like Coca Cola, the more relevant synonyms for trust would be credibility and self-orientation. That is, are they seen to be believable, and in whose interests are they seen to be acting?

(The right answers would be ‘yes’, and ‘those of several stakeholders’.) What’s your sense of Coke’s answer?

Which is a better deterrent to crime: jail sentences, or restraining orders?

We normally apply these sanctions against perpetrators of domestic violence, or robbery. But what about the scandal du jour—endemic stock option abuse?

Which is a better deterrent to stock options abusers: prison sentences, or structural reform around corporate governance?

The latest twist in options backdating? The practice has now been found among directors, not just executives. This is the lesson from a Harvard / Cornell / INSEAD report.

"In the data, we found that directors’ grants are equally susceptible to manipulation," Bebchuk said.

A “lucky” director grant was more likely at companies where executives received lucky grants, the study found. And firms with a higher incidence of lucky option grants were more likely to have governance practices considered unfriendly to shareholders, such as a minority of independent directors on the board.

The firms were also more likely to have "entrenching" bylaws, which make it difficult for shareholders to remove directors.
The study is not the first to raise questions about a possible link between options backdating practices and board governance practices. A study by the Corporate Library of 120 companies implicated in backdating found a high incidence of interlocking directors, or directors who served on more than one company that backdated.

The study suggested that backdating practices may have spread from company to company through these interlocking director relationships.

The disease metaphor is very tempting—practices that may have “spread from company to company through interlocking director relationships.” That sounds like the right answer is quarantine—Chinese walls—house arrest—restraining orders. In other words, reform.

Tempting, but extremely expensive. The US is already an overly litigious society and businesses are creaking under regulatory weight.

Using reform to solve trust issues is like using contraceptives to control the deer population—humane, but very costly, and hard to administer.

Punishment is not the preferred vehicle of reformers. But it may be just the right medicine for trust violations. Selective, highly visible, publicized, strong sanctions, particularly prison.

Many argue that prison is not a deterrent against crimes of passion, and only fosters recidivism. Precisely the opposite can be said about corporate executives and directors. Their crimes are coldly conceived, and prison to them is likely a huge dose of ice water. Jeff Skilling’s conviction and sentencing has already prevented more Jeff Skillings, I suspect.

Trust violations at the board level don’t require Chinese walls, but Chinese prisons. Sanctions are far more efficient, and probably much more effective.