It has been four years since I left the workforce and faded into retirement. As you can imagine, I have had plenty time to reflect on a number of issues and events during a long work journey spanning 50 years. All this in an attempt to distill my learning and formulate my conclusions. Why? So that I can share them with the younger generation in the hope that others have an easier path to success than the previous generation. Younger people often learn by making mistakes -- my hope is that they be new mistakes rather than a repetition of old ones.
During my long career, I had the privilege of working for several organizations. A handful left an indelible mark on me. They were great companies with exceptional leaders and with unique internal cultures. I was one of their employees at their peak, when they could do no wrong, where success shined brightly over them. They had one thing in common -- they were people companies ... not mere product or service providers. But as the law of gravity teaches us -- what goes up must come down at some point in time. But why? The reasons are many: loss of market focus, errors in strategy, fumbling execution, arrogance, self-absorption, neglect, and so on. A more insidious reason is the emergence and flourishing of internal Rasputins and/or Svengalis.
For those not familiar with either term, let me illustrate one of them: Rasputin. He is indelibly immortalized in 20th century Russian history. He was an Eastern Orthodox monk who used his spiritual role to gain access to the Empress and win over her confidence and trust. He used the relationship to manipulate the impressionable Empress for his own benefit and often to the detriment of others, especially those that he saw as potential or real competitors. He eventually was exposed and died ignominiously as a result.
Organizations, even the best, are not immune to this phenomenon that I have come to call Rasputins and Svengalis. Clever people use their superior talents to gain access to and eventually manipulate outstanding CEOs and senior managers. Being at the top, it is said, is lonely -- no peers, no real colleagues. To fill the gap, CEOs and senior managers must still rely on others for information, counsel, and social interaction. They select their inner circle from those they have come to admire for their technical expertise, people perceptiveness, unquestioned loyalty, sense of humor and/or intellect. When someone possesses one or more of these traits, he or she is able to more quickly penetrate the circle and seduce the top person. As part of the inner circle, they wield power that goes beyond their formal role, level of experience, or business acumen.
Most members of the inner circle use this power positively and to the benefit of the organization. A few, however, use it to fulfill other needs ... of the devious kind. They are interested in solidifying their unique position and to eliminate real or perceived threats. They cleverly work on shaving down others' credibility, impugning their motives, trivializing their capabilities and accomplishments. They work to erode others' stature in the eyes of the CEOs or senior managers so that their own profile can stand taller and stronger. One of the consequences of this treachery is executive isolation. The other is manipulation.
Rasputins and Svengalis come in all kinds of forms and gender ... they might be ex-college buddies, top-notch technical folks, accomplished consultants, sport partners, etc. They are as good as any chameleon and are able to disguise their real motives and hidden agendas. The effect on the organization is devastating. The very fabric that has brought success begins to fade and come apart at the edges. Trust level begins to decline. Communication becomes randomized and perfunctory. Fear of reprisal looms heavy in people's mind. Organizational energy starts to dissipate away from the customer to internal politics and posturing. Opportunities are missed, threats minimized, weaknesses hidden, and strengths weathered away.
You might say that this is just a theory. And you might be right at that. But I have accumulated too many critical incidents over the past 50 years to ignore this phenomenon. Let me share one glaring example.
A Risputin in one of the top companies in which I had the privilege to work managed to capture the attention and gain the emotional intimacy of the CEO. There was nothing that this man did not know or was not good at in the eyes of the CEO. He was the only one who could solve looming profitability challenges that required drastic management action and strategic reassessment. Only his viewpoint counted. It was foolhardy for others to question his recommendations. He saw to it that those who were not in line with his thinking would be branded as not loyal team players and too invested in the status quo. Deadly labels during tough times in any organization. They could be the first faced with elimination.
To conclude this example, this Rasputin convinced the CEO that there was only one way to come out a winner out of this managerial conundrum of increasing market share while drastically reducing operating margins. The board was dissatisfied with the profitability level. He convinced the CEO that salvation would be possible only if the organization outsourced as much as possible. No one raised his or her hand to question this strategy! Soon he singlehandedly, with the help of chosen claques and mini-Rasputins, began to outsource internal activities and processes to providers that (1) did not know how to do it better, and (2) who charged more for the service than what the organization was spending. His view was that there were no competent external partners and that the organization needed to develop their own. Result? Things got much worse. Board pressured the CEO out. Company lost its momentum and went into a defensive retreat in which many years later is still mired. By the way, the now ex-CEO still believes that this Rasputin can do no wrong.
The signs were there for all to see. Rasputin had a checkered business background. He had some success managing a green field operation in a friendly market place with unlimited resources at his disposal. He had no prior successful experience helping a grey field operation regain profitability and market dominance, His foray into launching a start-up was a total failure that ended up in bankruptcy, of course, he would maintain to no fault of his own.
It has been said that it takes a lot of work to screw up perfectly good companies. I agree. To speed up the process ... just bring in a few Rasputins. The management literature is full of examples. To name a few: Hewlett Packard, Digital Equipment, Sun Microsystems, Xerox, Memorex, Fairchild Semiconductor, etc.
I am sure that you can add to the list above ....
