Executive Times

Volume 5, Issue 2

February 2003


ã 2003 Hopkins and Company, LLC

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Whenever customer and business expectations are aligned, relationships develop smoothly. Whenever one party surprises another, or fails to meet expectations, relationships deteriorate. Organizations acting quickly in response to changing constituent expectations develop positive reputations. Bosses and subordinates sometimes need ways to clarify what expectations each has of the other. Sometimes, we learn more from the unexpected than we do from the expected. The best executives operate well when faced with both the expected and surprises. Sometimes, we do what’s expected; other times, we create surprises. In this month’s issue, we’ll call attention to some recent stories in the news about expectations, met and unmet, and how executives responded. As you read these stories, think about your own approach to expectations and surprises. How likely are you to be successful when the unexpected happens?


Fifteen new books are rated in this issue, beginning on page 5, two of which received a stingy one-star rating. Turn ahead to check those out. You can also visit our 2003 bookshelf at http://www.hopkinsandcompany.com/bookshelf.html and see the rating table explained as well as explore links to all 2003 book reviews.

“How to Turn Me On and Off”
All leaders have personal preferences or idiosyncrasies that make it relatively easy or hard for subordinates to meet a boss’s expectations. We recall Peter Drucker advising executives in one of his many books that the first order of business when dealing with a new boss is to find out if that person is a reader or a listener. Unless you know which style is dominant in your particular boss, you’ll waste too much time talking to a reader or giving a report to a listener. We were thrilled to read in The Wall Street Journal (1/7) (http://online.wsj.com/article/0,,SB1041881615563021064,00.html) that at least one boss has found a tool to help subordinates: an owner’s manual on himself. Ron Goodspeed, CEO of Southcoast Hospitals Group was hiring a new direct report and wanted to communicate what it was like to work for him. “The one-page document, based on a self-assessment and input from associates, was designed to offer tips to the new VP on how to work for the man who oversees three hospitals and 5,000 employees. … ‘Ask me to “get to the point.” Hint: If I use analogies that are not clear, please ask me to be more concrete.’ In addition, the manual instructed the newcomer to warn Dr. Goodspeed if he was ‘charging down the wrong path.’ He also advised him or her to supply more rather than less information, and not to test the waters before making recommendations.” According to the new VP, the manual works. “This is really very helpful because it saves a lot of time figuring out what the boss thinks of things. My respect for him went up a notch. I said, ‘Wow!’” The next step may involve deciding where to affix the warning labels.

How do those who report to you know the best ways to work with you? Are you aware of how they interpret your behavior? If you were writing an owner’s manual on yourself, what would you write? What can you do for your direct reports to help them and to help you?


Yours, Mine and Ours

Any day now, Viacom chairman and controlling shareholder Sumner Redstone will decide where his job ends, and where President Mel Karmazin’s job begins. When the company proxy is mailed in March, there will be a new organizational structure. According to The New York Times (1/20) (http://www.nytimes.com/2003/01/20/business/media/20MEL.html) and The Wall Street Journal (1/20) (http://online.wsj.com/article/0,,SB1043030890284548344,00.html), speculation has begun about who ends up leading the company. In May, the three-year contract expires under which Karmazin was given operating control of Viacom following its acquisition of CBS. The fact that Redstone is 79 and Karmazin is 59 may not make any difference in how this episode turns out. Both Redstone and Karmazin seem to have differing expectations of each other. According to The Times, “Mr. Redstone has seemed ambivalent about whether he wants Mr. Karmazin to remain. A few months ago, when he began to express confidence publicly that Mr. Karmazin would stay, people close to the contract talks say, Mr. Karmazin was annoyed because he found the chairman's predictions presumptuous.” Once their negotiations are complete, the company can move forward without the shadow of this leadership confusion. In the meantime, we recommend they both read the next article on how to step down.

How do you differentiate your job from those of your direct reports? When there is overlap, how do you respond? When there are gaps (or white spaces on the org chart), how are those filled? When negotiating the span of control issues and accountabilities, how clearly do you communicate your expectations? How well do you hear the expectations of others? How easy is compromise?


Fifty Ways to Leave
With so many leaders stepping down, there’s no shortage of role models and advice-givers providing examples or suggestions on the best way to say good-bye. Thanks to the satirists at the Capitol Steps, the tune in the background as you read this article can be “Fifty Ways to Say I’m Sorry”- the Trent Lott arrangement (http://www.capsteps.com/sounds/lott-fiftyways.mp3). One advice giver, Jeffrey Zaslow, said in The Wall Street Journal (1/3) (http://online.wsj.com/article/0,,SB1041449740835925513,00.html), “Before you fold your tent, you have to fight off the brain processes that delude you into thinking that when the chips are down you're ‘due for a win.’ Too many of us mistake denial for optimism, and obsession for duty. We seek advice from loved ones and subordinates most likely to give us the positive spin. But the smartest quitters listen more closely to foes than friends, researchers say. And when their inner voice tells them to cut their losses, they pay attention. … Researchers advise: Write down ‘stopping rules’ before you take a job, outlining which scenarios and warning signals will cause you to quit. And be honest with yourself about your delusional impulses.” According to The New York Times (1/24) (http://www.nytimes.com/2003/01/24/business/24BROA.html), Henry Nicholas, co-founder and CEO of Broadcom, took a spin on the “spend more time with family” reason for leaving an organization. “… in a call with Wall Street analysts yesterday to discuss the company's fourth-quarter earnings, Mr. Nicholas, 43, said that he had been contemplating leaving the company since the middle of last year in light of his marital problems. He said he had taken time off in December and January to address the matter. ‘I must dedicate my full time to it,’ Mr. Nicholas said. Discussing his resignation, which is effective immediately, he said, ‘This was driven entirely by personal issues related to family separation and divorce.’ … Mr. Nicholas was known for his hard-driving anti-Silicon-Valley management style, which included imposing a dress code, pushing his and his employees’ limits, and playing as hard as he worked. He bragged about all-night drinking binges, had a 15,000-square-foot house, a Lamborghini Diablo Roadster and a personal trainer on 24-hour call.” Imagine what will happen when Nicholas dedicates his full time to his marital problems.

What signal will tell you that it’s time for you to go? Do you have “stopping rules” that relate to your current job? What would cause you to step down voluntarily? Do you usually cut your losses, or gamble that a string of losses will end with a big win? What’s your personal exit strategy? 


Unintentionally Uninsured
Is your insurance carrier more or less likely to pay your claims? How would you know? At the same time you expect them to pay, are you aware that they expect to deny your claim? The business press continues to be full of stories about insurance companies focused on loopholes and drawn out claims processes to avoid paying legitimate claims. We read in The Wall Street Journal (1/16) (http://online.wsj.com/article/0,,SB1042676552679806384,00.html) that a judge upheld a jury award against UNUMProvident saying the company “had a comprehensive system for targeting and terminating expensive claims.” Is having a system to target certain claims a prudent loss mitigation activity or something else? According to the Journal, “a federal judge in Maryland concluded UnumProvident's behavior, in denying the Erisa-covered disability-income claim of a Baltimore legal secretary, had ‘bordered on outright fraud’ and that the company implemented ‘an unprincipled and unreasonable review process.’” 
We read in The New York Times (1/24) (http://www.nytimes.com/2003/01/24/business/24CARE.html) about the approach used by another company in setting customer expectations. The largest nonprofit health maintenance organization in the United States, Kaiser Permanente, has updated its website to disclose to the public the guidelines it gives to physicians on the treatment of diseases. While not compulsory, the publication of these guidelines establishes a basis for patient expectations that’s likely to be met by participating physicians. Kaiser’s action was in response to two lawsuits. “The actions by Kaiser are the latest example of efforts to help consumers have more informed discussions with their doctors. Health policy experts say the disclosures may also help narrow the gaps in the treatments offered for identical diseases by doctors and health plans across the country.”
We can’t open the topic of being uninsured without some comment on the 40 million Americans without health insurance. New solutions may come from unexpected places. We read in The New York Times (1/5) (http://www.nytimes.com/2003/01/05/business/yourmoney/05SENI.html) that Louisiana conservative Democratic Senator John Breaux now supports universal health care coverage. Under Breaux’s plan, all Americans will have to buy health insurance coverage from private companies. Those who can’t afford the premiums will receive support in proportion to incomes. Under Breaux’s approach, everybody gets in the pool, which should lower the risk to insurers. Breaux has bridged gaps between liberals and conservatives before, and may again.

When would you find out that your insurance carrier is overzealous in denying claims? Do you really have the insurance coverage you’ve paid for? How zealous is your company in finding ways to get out of meeting the expectations of your clients? Are your guidelines or processes transparent to your customers? Do you help them know what to expect from you? Does the current health insurance system of many small pools of risk help or hurt you and your organization?



Here are selected updates on stories covered in prior issues of Executive Times:

Ø      The first issue of Executive Times in April 1999 expressed disappointment that the International Olympic Committee gave an overwhelming vote of confidence to its leader Juan Antonio Samaranch following scandals. With a feeling of déjà vu, we read many articles in recent weeks about more trouble at the United States Olympic Committee. This time the out-of-touch executive is Lloyd Ward. An ethics report concluded that he fostered the appearance of a conflict of interest when he assisted his brother’s business venture. He admits to an error in judgment. The USOC executive board has his full support. Next stop: Ward called on the carpet for hearings before Congress as we go to press. For more about Ward’s prior errors in judgment, see the December 2000 issue about his Maytag exit; the March 2001 issue about his plan to make iMotors a Fortune 500 company, and the June 2002 issue about the accomplishments of his successor at Maytag. The USOC needs leadership above reproach.

Ø      The March 2001 issue of Executive Times featured Illinois Governor George Ryan in the Legacy column. We called attention to his suspension of the death penalty in Illinois, despite his long time support. Ryan concluded that the system was broken and innocent people were convicted and sentenced to death. It came as no surprise to us that prior to leaving office in January, Ryan commuted the sentences of all Illinois death row inmates to life imprisonment. He also issued a handful of pardons. You can read the full text of his speech in The New York Times at http://www.nytimes.com/2003/01/11/national/11CND-RTEX.html.



The Father of Management Consulting
The profession of selling management advice can be traced to the efforts of Marvin Bower, who joined a small Chicago engineering and accounting firm during the Depression. Bower defined the services and standards followed by McKinsey & Company, and influenced the growth of the entire management consulting profession during the 20th century. Thanks to Bower, it became a profession. Bower died in late January at age 99. A man of distinction, Bower called the company a firm, and its jobs “engagements.” One of Bower’s fundamental principles was that McKinsey consultants had to place the client’s interests first. He directed the firm to take on only work that was needed, and work the firm could do well. He always told clients the truth, not what they wanted to hear. One obituary (http://www.nytimes.com/2003/01/24/obituaries/24BOWE.html) related that, “In 1993, at the last of a series of retirement dinners, a colleague, Jack Crowley, recalled a meeting in which the head of the client company bellowed argumentatively. Mr. Bower told the executive that his company’s problem was its top leadership. There was deathly silence. It happened to be totally accurate. That was the end of our work with that client, but it didn't bother Marvin.” When he retired, “in perhaps the ultimate selfless act, he decided to sell his stock to the other partners at book value, rather than at a vast premium that might have forced the company into debt. That single decision helped make McKinsey an enduring institution, by more easily allowing the transfer of ownership and power to larger numbers of new partners.” (http://www.businessweek.com/bwdaily/dnflash/jan2003/nf20030124_5912.htm) The day after Bower’s death, McKinsey Managing Director Rajat Gupta praised him saying “Many of us will continue to make choices for the rest of our professional careers based in large part on the question we often ask ourselves: ‘What would Marvin have done?’”

Latest Books Read and Reviewed:

 (Note: readers of the web version of Executive Times can click on the book covers to order copies directly from amazon.com.  When you order through these links, Hopkins & Company receives a small payment from amazon.com.  Click on the title to read the review or visit our 2002 bookshelf at http://www.hopkinsandcompany.com/bookshelf.html).


Title (Link to Review)



Review Summary


One Nation Under Gods: A History of the Mormon Church

Abanes, Richard

Saints Revealed. From Joseph Smith at the beginning to the 2002 Olympics, Abanes presents a history of Mormonism that reveals them to be a cult, not the Christian religion they present to the world.

J.R.R. Tolkien’s Sanctifying Myth: Understanding Middle Earth

Birzer, Bradley J.

Holy Hobbits. What the value of myth is to all of us, and what myth, Middle Earth, and Catholicism meant to Tolkien who wanted to return England to its pre-World War I bucolic life.

Rodeo Queens and the American Dream

Burbick, Joan

Pantomime. Thoughtful and well-written perspective on the women who represented the rodeo and reinforced a way of life in the American West that never really happened.

Nine Horses: Poems

Collins, Billy

Gallops. If you’ve not read any poems by our current poet laureate, you may as well start with this latest collection. Finely written. Some funny; some sad.


Crichton, Michael

Mechanical Plague. Typical weak dialogue and writing, but strong plot full of wildly creative ideas. Scary story of the merger of biology and technology. A quick read.

The New Culture of Desire: 5 Radical Strategies That Will Change Your Business and Your Life

Davis, Melinda

Oh O. Thanks to something called The Human Desire Project, we know way too much about what people want and the lengths to which they’ll go to get it. Some desires should be sublimated. For more, check out February 2003 issue of Fast Company (http://www.fastcompany.com/online/67/desire.html).

Seeing in the Dark: How Backyard Stargazers Are Probing Deep Space and Guarding Earth from Interplanetary Peril

Ferris, Timothy

Look Up. Outstanding science writer takes readers into the world of amateur astronomers and the contributions they make. Makes you want to buy a telescope and look up at the night sky.

Hornet Flight

Follett, Ken

Soars. Interesting and appealing heroes and villains whom we cheer or jeer as the action unfolds. Heroes in trouble at every turn, and villains get lucky far too often in this exciting tale of the Danish resistance during World War II.

The Spirit of Family

Gore, Al and Tipper

256,000 words. 256 pictures on the theme of family show the diversity and uniqueness of American families.

Churchill: Visionary. Statesman. Historian

Lukacs, John

Forceful. Short, breezy, clear and opinionated historical perspective on three dimensions of the great Winston Churchill. The writing sparkles.

Bad Boy Ballmer: The Man Who Rules Microsoft

Maxwell, Frederic Alan

Madman. Many facets of the journey of Steve Ballmer from suburban Detroit to a partnership with Bill Gates that changed the world.

Red Spy Queen: A Biography of Elizabeth Bentley

Olmstead, Kathryn S.

Why Spy? Tedious tale of FBI star witness against her former comrades in the 1940s and 1950s, sometimes telling the truth and sometimes lying.

When the Emperor Was Divine

Otsuka, Julie

Injustice. Debut novel takes on Japanese internment during WWII with care and precision capturing the impact on the members of one family at that time. Poetic voice creates lasting images.

Officer Friendly and Other Stories

Robinson, Lewis

Maine Man. Debut collection of stories from Maine writer Lewis Robinson reveals great talent. Lovers of short stories shouldn’t overlook this writer.

What Color is a Conservative? My Life and My Politics

Watts, J.C.

Preacher. Sermonizing biography of this former congressman. He’s who he is because of how his parents raised him in a small Oklahoma town. First hundred of 275 pages brings us through high school.


ã 2003 Hopkins and Company, LLC.  Executive Times is published monthly by Hopkins and Company, LLC at the company’s office at 723 North Kenilworth Avenue, Oak Park, Illinois 60302. Subscription rate for first class mail delivery of the print version is $60.00 per year (12 issues). Web version subscriptions are $30.00 per year. Single issues: $10.00 print; $5.00 web. To subscribe, sign up at www.hopkinsandcompany.com/subscribe.html, send an e-mail to executivetimes@hopkinsandcompany.com, call (708) 466-4650, or fax to (708) 386-8687. For permission to photocopy or e-mail Executive Times, call (708) 466-4650 or e-mail to reprints@hopkinsandcompany.com. We will send sample copies if requested. The company’s website at http://www.hopkinsandcompany.com/archives.html contains the archives of back issues beginning in the month after the issue date. 

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