Bookmark and Share Email this page Email Print this page Print Pin It
Feed Feed

Jul 31, 201212:00 AMMad @ Mgmt

with Walter Simson

Restructuring, government, and respect

Restructuring, government, and respect

Mad @ Mgmt addresses the concerns of middle-market companies, including banking, family and succession issues, turnarounds and performance improvement, and economic life in general. Walter Simson is founder and principal of Ventor Consulting, a firm dedicated to middle market companies.

If there is one cardinal rule of restructuring, it is that the person in charge must respect all the constituents. It is a sure sign of an amateur to blame the employees for the changes that must take place. I know this from my own, early missteps. It only takes one disparaging remark about an employee for the entire restructuring effort to be maligned as a petty and personal vendetta.

Respect, I have also learned, cannot be faked. It comes from understanding that people generally do their best under the conditions they have been given, and most employees have a finely tuned understanding of what does and does not work in the organization. Also, every company that undergoes a restructuring also must deal with disappointment – sometimes trivial, sometimes deep.

Let me be clear. This disappointment does not have to mean job cuts. I have presided over many restructurings where overall employment has increased with profitability. But sometimes retail stores need to be closed or factory hours need to focus on one product over another. This is not the fault of the people working there, so leadership must show only sincere concern for the individuals affected.

So what about the restructuring of government functions? Especially when the parties affected may have unions that are political players, and powerful rivals? That's different, right?

Nope.

Treating employees with respect is a cardinal rule, and it means that the reasons for the changes need to be explained and carried out so that all the employees feel that they have been treated fairly, even if there is disagreement over such matters as the cost of health care, retirement promises, or union seniority.

In this regard, a few of our well-meaning governors have made the beginner's error. They declared a raucous victory to their political allies at the public expense of their political rivals-slash-employees.

Let me be clear. If restructuring government is necessary – and it is – then it must go forward. But our system has somehow made it politically profitable to tweak the noses of the people affected, rather than implementing a business-like change. In this way, politics is harming the practical needs of the restructuring by causing bad feelings and expensive retrenchment efforts.

This is not a theoretical discussion. It is one that taxpayers should care about. Because if we find that a proposed government restructuring is not in complete service to the practical, why would a rational person support it? We want to maximize the practical effects so taxpayers get the best deal. If not done properly, the "restructuring" becomes a cynical effort to maximize the political effects, such as media exposure. In that case the taxpayers lose out.

And what about respect for the voter? Certainly Wisconsin Gov. Scott Walker could have been clearer about his exact intent in his planned restructuring, both before the election and prior to taking the restructuring steps. Giving him the benefit of the doubt, this was probably a simple tactical error, and we may see that the next round of changes in Wisconsin state government, when they inevitably occur, will have clarity and respect as the guidelines.

[Parenthesis alert! Because a governor makes an error, even one possibly meant to injure or insult, should that make him subject to immediate recall? I do not believe so. Governors, like CEOs, need to grow in the job. A good friend of mine who was a protégé of Jack Welch at General Electric can cite chapter and verse on how the successful CEO there needs at least 10 years to learn the ropes. I believe that is true at GE, and it means that anyone elected governor has got to come up to speed in 40% of that time. And if we recalled every governor after an unpopular initiative, it would mean essentially the end of good governance, because we would only sustain immediately accepted proposals, no matter how badly conceived.]

[Tell this to my friend at GE. Somehow, Reggie Jones, Welch's predecessor, gets nine good years to learn the job there, but to my friend, President Obama needed to come into the U.S. presidency fully formed. Gosh – it doesn't seem fair to Obama. Okay, back to original programming.]

Another governor who has to take a respect lesson is Chris Christie of New Jersey, who was asked by a lady named Gail whether his kids' private school education colored his confrontational approach to public school reform. His response? "Hey, Gail? You know what? First off: It's none of your freakin' business."

Actually, I added the word "freakin'" because to my horror I once wasted an hour on that black hole of reality TV, Jersey Shore. They use that word a lot in Jersey. It's kind of a verbal tic, the way Canadians say "eh?" But even taking that regional marker out of the quote, it does not strike me that the man believes he is in office by the consent of the governed. And the respect required in a restructuring should also run to the voter, even in Jersey.

For my money, a little more respect for both employees and voters, along with a lot less political posturing, will lead to better government – even when the choices are burdensome to some of the freakin' constituents.

Sign up for the free IB Update – your weekly resource for local business news, analysis, voices, and the names you need to know. Click here. If you are not already a subscriber to In Business magazine, be sure to sign up for our monthly print edition here.

Add your comment:
Bookmark and Share Email this page Email Print this page Print Pin It
Feed Feed
Edit Module Edit Module