Anticipating the various reactions will be part of the strategy of anything that the Obamas do publicly, and would certainly be part of planning at the Academy Awards (e.g. what will people think of Seth MacFarlane hosting?). Conceivably the “go vs. no-go” decision is a function creating enough “net good” for those about whom we are concerned. Politics in the U.S. can be divisive, and one could easily excuse the Obamas and the Academy for discounting a large group who will find fault with anything and everything that they do. It is good strategy to avoid trying to appease those who will never be so.

Predictably, critics will say that this is the President paying back Hollywood for the support (financial and otherwise) he received in getting re-elected. Perhaps these reactions were not seen as important. If so, I think they discount the group of people whose lens on the situation is not entirely pre-determined by their “Love Obama” or “Hate Obama” view of the world.

If there is a concern for people whose world is not so simple, it was a mistake to involve Michelle Obama in this ceremony: the optics are bad.

I am not talking about the White House “infiltrating every facet of our lives” or church and state separation (if you can equate Hollywood to the former). The bad optics come from the movie “Zero Dark Thirty,” which was up for Best Film. I have yet to see this movie, so I do not know if it looks at the Obama administration favourably or not. It probably does both, and it doesn’t matter either way. By virtue of the subject of this film, a White House presence at this particular Academy Awards ceremony was inappropriate. There is not way around it. Imagine if the movie had not been nominated. Could that have been because it committed some slight on the sitting President? (Bad optics.)

So many facets of our life are political. In this blog, I will often touch on issues relating to health care in Ontario and Canada. Politics will always have its place in these discussions. Why bring more politics into a situation than you have to?

The moral of this story is: be careful where you show up. This may be more pertinent to leaders (politics, as well as business), but speaks to anyone. People will read into your intentions. Any issue is never as easy to discuss as it is to paint an “us vs. them” storyline. Those with influence have an opportunity to muddy the polarizing lines in the sand. I think we need to look for a different kind of leadership: one that doesn’t fall to the “play to your base” and “divide and conquer” approaches… or that even allows the optics of such approaches to persist.

Part of the answer to both of these occurred to me as I left campus and saw a more traditional “networking event” taking place. I see a tremendous amount of value in networking in its many different forms, but in contrasting the 4S experience with the one unfolding behind the glass of the ELC dining lounge, I was struck with the differing emphasis on speed and accuracy.

From my perspective, the core skill in traditional networking is determining as quickly as possible whether or not a relationship is worth pursuing. Parallels to speed dating are fitting because all parties are conceivably clear on what they want (e.g. the reasons for going to a Finance networking event are either because you are looking for a job or an employee in the area of Finance). Although people don’t say “Hire me,” those in hiring functions of well-regarded organizations usually get the most attention. The pressure for a student is to develop an “elevator pitch” that conveys credentials, while differentiating from your competition. The pressure on the employer is to figure out who will “fit with the culture.”

In the 4S event, relationships were unfolding at a much slower pace, and I am not sure that people were clear on why they were there. In the hour that we were together, there were 5 speakers including the co-founder (James MacDonald) who gave the backstory to how 4S came to be. I got the sense that the storytellers were not as interested in “positioning” their story so that it fit with something the audience wanted to hear. I found this refreshing. The question “so what?” would have been completely out of place for this gathering, but if asked, I am confident that each speaker could have given a nice synopsis of what they thought was the crux of their particular story. I am less confident that the speakers would have done themselves justice. This may be where my expertise relates.

I have always been intrigued by the space between the story you believe and the one you tell. The job interview process creates natural space between these two stories. Few prospective employees would say, “No one has ever taken a chance on me to run a P&L before, but I am confident that I have the skills to do it, and I am happy to be accountable for the results.” Yet, so many career success stories that I have heard contain an anecdote of a pivotal moment when “someone took a chance on me.” Determining how truthful can be difficult if we are constantly evaluating the risk of sharing something that turns off our audience. If we are constantly running risk reports on how honest to be in communications, my skills lie in assessing those risks. In retrospect, my feedback on the stories was largely describing the nature of the risks people took.

All of those who spoke at this 4S event took the risk of being a bit vulnerable in front of a group of colleagues. I think that we all benefited from being involved.

Working from the hypothesis that “to appreciate where we are, it is worth revisiting how we got here,” this book includes a thorough review of the history of the Canadian Medicare system. This was very instructive to me, although some will be more familiar with these developments. Some of the important elements that stood out for me were:
1 – “Fee-for-service”  for providers (specifically doctors) is well baked into the system
2 – Hospitals are a distinct and well-developed part of both the infrastructure and of the system
3 – Even though the Canada Health Act allows non-government service providers, the word “private” complicates any discussion because it conjures up “US-style,” “two tier,” and other terms that garner very emotional responses.

Simpson provides a thoughtful comparison of our system with those of England, Sweden and Australia. This illustrates how no one has a perfect system, but there are systems that perform much better than ours does. He suggests that low public awareness as to the mediocrity of results from the Canadian system (by OECD standards) is a big part of the problem. Maybe people are fine as long as we are not as bad as the US. Politicians certainly benefit from the misperception both in reducing panic of a looming crisis and in hiding any province-to-province comparison that could identify comparative laggards.

According to Simpson, continuing to throw money at the current system is a complete waste of resources and is an admission that funders do not understand the dire situation that we have created. The big thing at stake is what he calls “vertical equity” meaning that the status quo puts an unfair burden on future generations. (He uses “horizontal equity” to describe how the system treats people in terms of access and care at any given time.)

The big recommendations are threefold:

(1) Doctor and nurse unions have to stop being rigid in protecting compensation. Fee-for-service usually means that “how much” you get paid is a function of “how much” you work. Again, there is no clear answer but Simpson relays the challenge of how, for example, reducing wait times leads to rising costs because more patients are being served.

(2) Hospitals need to be allowed to do what they do well, and cease to provide ALC-type services that are both of insufficient quality and of exorbitant cost.

(3) Drug expenses have to come down. He suggests a national drug plan based on CPP.

Each of these avenues takes on a very specific and very powerful interest group: unions, hospital administration and pharmaceutical companies. All tough rows that need to be hoed.

I enjoyed the read, and it got me thinking about how much of the eventual solution will come from strong leadership in small areas that can start some momentum. Actions and results at lower levels can help to build the various beachheads that need to be established for more comprehensive systematic changes to bring sustainability and “vertical” equity.

Two of the concepts that Prof. Weinstock examined were, to paraphrase, “rules that no one argues with” and loopholes. As champions of following procedures and sticking to contracts, supply chain professionals should be familiar with both. They may also share the frustration of not being able to enforce rules with the internal rule-breakers and the unintended consequences of new rules.

The Rule is the Rule

In sport, the “rules no one argues with” pertain to safety and to fair play. Although some purists in hockey will fondly recall the flowing locks of Ron Duguay or Guy Lafleur, few could make the case to repeal the helmet rule. Similarly, to stick with hockey, no one argues with the “too many players on the ice” penalty. Both safety and fairness appear to provide a solid base for the presence of a restriction on actions in the form of a rule. No rule, however, is completely bullet proof:

• Safety: Could “no helmets” actually help the concussion situation because people would not hit as hard?
• Fairness: Hockey fans will appreciate the discussion of “fair play” around “The Avery Rule.”

If safety and fairness work most of the time for sports, what constitutes these solid planks in business?

• Cost savings?
• Profitability?
• Customer satisfaction?
• Sustainability?
• Doing the right thing?

There is promise here for a 2×2 matrix that plots “ability to quantify” vs. “importance to long-term business success.” Even with such a tool, there are no clear winners. An organization can try to be clear about its stance on what is important. Johnson & Johnson’s credo is one attempt at this clarity.

The wording will never be perfect, but such proclamations can reflect the organizational direction and the industry context. For example, a logistics outsourcing operation could logically place “cost savings” or some form efficiency within the rules that no one expected to argue with. The goal, I think, should be to be somewhat clearer than statements like “we value integrity and honesty” but not as prescriptive as “never ever spend more than you absolutely have to.”

The Rule isn’t Really the Rule

Loopholes are fuzzy in a different way. The shared understanding of these was that such rules enable someone to operate “within the rules” while clearly operating outside the spirit of the game. In an organizational setting, these are called “workarounds.” Your view of the effectiveness of the rule is the thing that separates a “workaround” from “loophole.” In either case, everyone knows they are happening… and some may be very aligned with the long-term success of the business.

The presence of a workaround may provide an area of opportunity to be clearer. Acknowledging the work-around can identify a rule that could change. In some instances, the threat of “re-opening the constitution” may be too great or too troublesome. It may simply provide an opportunity to revisit the “spirit” of our activity. This should be a health discussion that could help mutual understanding.

A Rule for Rules?

Understanding the role of rules is important. We don’t want to prescribe unless something very important (e.g. personal safety) is at risk. For many cases, guidelines can provide people with the freedom to act and use judgment in performing their function. And, no, there is no clear rule for rules.

Are you picking your battles?

By definition, those working in supply chain are “caught in the middle” between two nodes in the chain. When this idea of “right” becomes a struggle between, for example, consistency and timeliness  (e.g. I don’t need it right, I need it on Tuesday), you can make a judgment call as to which of those positions is more “negotiable.” “The boss said Tuesday,” is an understandable piece of evidence to introduce to the consistency camp. But is “Tuesday” reasonable? Is the consequence of missing the deadline worth the consequence of breaking with consistency? That is a conversation that may be difficult to broach, especially if “The Boss” has little time or attention to expend. Engaging rather than accommodating may bring about a more informed decision and direction. A solid base of relationship capital—with all parties—can help move this to a collaborative conversation rather than a battle of “The boss said” vs. “That is crazy!”

Are battles picked for you?

In a competitive environment, whether trying to win business in the marketplace or win resources internally, it is easy to fall into the mindset of a win-lose approach that creates adversaries rather than collaborators. It is worth asking oneself, “Am I the one who is making this adversarial?  Can I see it a different way?” It is equally beneficial to ask, “Have we been pitted against each other?” Well-intentioned people may have created a reward system (formal or informal) that sets up the interaction as a zero-sum game. (e.g. on time or on budget?) If you have different measures of success, it is another instance of right vs. right. Is there a common “right” that makes sense to both of you (e.g. customer satisfaction)? If so, you are now allies in engaging to have better measures in place for next time.

So…

The “right” actions and initiatives can come from many places, but those originating from a supply chain function may carry the risk of being seen as a hindrance and not a help. It takes a deft appreciation of the overriding narrative to understand which actions will be most effective and what conversations (up, down and across) will enable implementation with the least amount of resistance.

One big advantage of supply chain is the end-to-end view that this discipline affords. In his novel The Ground Beneath Her Feet, Salman Rushdie recounts, “The only people that see the whole picture are those who step out of the frame.” We are all in a frame, but I think that those in supply chain have one of the wider ones going. This can help them see the more wide-reaching “right” way to do things. Sensitivity and skills in collaborating will help.

THIS ORIGINALLY APPEARED IN THE NEWSLETTER FOR THE CANADIAN SUPPLY CHAIN SECTOR COUNCIL – Oct. 2011.

The more shocking fact,to me, was that apparently several students actually paid money. I love the exercise in that it forces students to make a decision, which should be the activity that MBA education helps. What the description of the article misses (although this may have been part of the class debrief) is the ethics involved in that decision. Value distribution could be one point of this exercise, but what does it say about the students who were prepared to pay money for additional help with the course material or for a positive job recommendation.

Additional support for course work can take many forms from hiring a tutor to buying last year’s tests. I am not sure where the ethical line is exactly, but I will suggest that paying a professor cash in order to attend an extra tutorial is on the wrong side of that line. I will say the same for cash for recommendations (but the recommending function of linkedin could be a real accelerant for that line of business!).

I would hope that in addition to Prof. Kachra’s intended lessons, the students who paid him the money carried around a sinking feeling in their respective stomachs. I would hope that feeling came before the “reveal,” but reading this story makes me wonder two things (1) can you actually teach ethics? and (2) did the students realize that, in real life, the “reveal” could be whole lot messier?

We had a number of discussions within the senior team about whether or not to bring supporting functions into a shared services framework. It was a really good exercise and we were able to clarify some important strategic issues.

For example, although we have been trying to do more work in Canada (with a recent focus on competing more effectively on public sector contracts), the bulk of our business comes from U.S. customers. One of our director’s is very quick to wax on about “selling the value” and that “objections on price are a cover something else.” That is all well and good, but when you largest customers dollar is in a pretty steady slide, it might be worth looking at price. This latter point was pushed by our CFO, who is not used to having to explain himself, but to his credit, he took us through the thinking, and even apologized for making it so basic.
The key measure for this project is profitability, and if it is implemented correctly, we will see a significant increase in profits even with steady or even slightly lower rates to our U.S. customers.
In the mean time, this gives us some budget room to build up some resources and make some very strategic hires that will help us compete for upcoming public tenders here and out West. The joke on our last bid was that we were in danger of being the dog that actually caught the car… Needless to say, we didn’t catch it, but we’ll be in a better position to in about 8 months.

HE’LL SAY (Department Manager, overheard at the water cooler):

First of all, if you are going to make a bad decision, why not get on with it. The hype around this “new direction” was unbelievable. Do you really have to have three “offsite strategy sessions” to figure out how to bury accountability for me and for my team? It would have been faster to say:

“Folks, a lot of people have been whining about how unfair it is to celebrate success openly, so we are going to put you all on the same team… and by the way, we are going to get into bed with some governments because they have the same view that we do.”

I have been running this division for 8 years, and for the last 7 we have put up the best numbers in the worst market. It took me a few years to get the team that I wanted, but right now we are a well-oiled machine, and we all love competition. For Pete’s sake, we are most competitive with ourselves. I am supposed to be happy reporting into a “shared services” lead that supports all markets. I can tell you right now who the weak links are, but this model is guaranteed to give the weak links better air cover.
I’LL SAY (to you in this post):

A common literary device is the split perspective. More than half a century ago, the movie Rashomon (http://www.imdb.com/title/tt0042876/) tells the story of a rape and murder (or was it?) from different perspectives, all of which appear to be truthful.
In the above (very general) example, and constantly in very specific situations, the same thing happens. Such truths as “we will focus on public sector contracts” and “we are making changes to reduce expenses and help profitability” will be explained and recounted in different ways.

As alluded to earlier, no one perspective can know all the implications, so picking the actions is an important exercise that involved understanding strategic issues and opportunities. It is also safest to place these actions within a simple strategic storyline: “Our run-rate business is diminishing; we have to look for new sources of revenue.” At every opportunity, make obvious the connection between strategic story and the actions. Without a context, just like “HE SAYS,” people will fill in their own… and it may be very detrimental to your overall goals.

I concur that stating “It’s not about going green, it’s about making money and minimizing risk” smacks of motherhood, but the clarification this from a strategy level will quickly become a negotiation about trade-offs involved. For simplicity sake, let’s look at an industry that makes no pretense in the “doing good” department: contraband cigarettes.

Tom Blackwell’s recent series in the National Post exposes a picture of a complex supply chain and the risks taken on by some of the parties. Beyond the tobacco farmers as suppliers of raw materials, the industry needs paper and filters. Suppliers would be smart to engage their buyers in a discussion in order to fully understand the risk and return trade-offs. The discussion should address the risks involved with supplying illegal factories, apparently located on First Nation reserves. The balance of risks (of being associated with a contraband industry) with return (of additional sales) can become a business decision beyond its ethical implications.

You can see how this becomes an internal negotiation, as well, and provides an opportunity to clarify what is acceptable by multiple measures (e.g. what do we mean by sustainable, ethical or other measures?). Avoiding these negotiations leaves a larger degree of risk than necessary. If/when a crisis breaks regarding untoward supplier relationships, the communications and public affairs department may be stuck with: “We never bothered to ask” as a defense. This may not be acceptable to stakeholders on grounds ranging from ethics to stock price.

Gaps between “doing” and “saying” create risks that need to be acknowledged, and then managed and reduced. Treating these situations as a collaborative negotiation (internally and externally) can assist in this process. Not every industry operates in such proximity to ethical and legal risks. Nonetheless, the approach is similar. Sustainable business can offer some common ground from which to build a conversation/negotiation about shared value. A first step is to identify the different aspects of sustainability and how they are prioritized. It will be worth the effort.

The net/net of the earlier column was, if you have all three of these elements, collaboration is optional.

THE “2 out of 3” SCENARIOS
#1 – No AUTHORITY – Sell the idea
The extent of simultaneously moving parts in most business functions creates a situation where those managing the work cannot be familiar with all the intricacies. Having information and expertise usually means that you can see the consequences of a decision (e.g. “No, we can’t just ship in larger quantities to make sure we meet demand; the expense and risk of housing inventory in that particular location is prohibitive.”).
The approach here is to “sell” the right idea. If you have fostered a degree of “benefit of the doubt” with the “authority” figure, this can be very easy. If the relationship is not there yet, this will demand a thorough understanding of that person’s interests, and a savvy ability to tell them what they need to hear. This is the realm of persuasion and communication skills. In my view, it is the responsibility of our informed experts to get these ideas through.

#2 – No INFORMATION – Help me help you
The final scene in the Cohen Brother’s movie “Burn After Reading” illustrates this situation perfectly (and hilariously), but in real life these interactions can horribly frustrating. Picture a situation whereby you are a competent cook and you have the authority to make whatever you want for dinner. Yet your question “what do we have in the house?” is met with either:
1 – “Well, there is a lot of stuff in the house,” OR,
2 – A detailed list of “everything” in the house.
The fog created by the audience’s lack of expertise can thicken if they are at all intimidated by the degree of authority. These situations are quick to break down completely (e.g. “we’ll eat out tonight!” or “just let me in the kitchen to see for myself!”) The overriding “help me help you” desire can—time and patience permitting—also take the form of tolerating the lengthy list and taking what is useful.

#3 – No EXPERTISE – Hand over the authority
This is the flip side of “No AUTHORITY” and demands a large degree of comfort with the lack of expertise. But, no, this doesn’t mean abdicating completely! Those in authority are tasked with taking a wider look at things, so, to use our first example, they understand the trade-offs involved with running short on supply (e.g. disappointed customers), as well as the trade-offs involved with keeping more inventory (e.g. higher costs and risks). Taking all into account, they can arrive that the decision that does the “best” for the organization.
The interesting part here is the word “best,” which should come down to strategic priorities for sustaining business success, rather than “best” for specific segments of the company (short-term profitability) or individuals (least headache potential). With the necessary separation of expertise and authority, such strategic priorities need to be very clear. A colleague of mine and I consult with organizations to align such strategic priorities with elements of the triple bottomline (profit, planet and people) and to leverage those in engaging with various stakeholder groups. The ensuing conversations, though tough, are well worth having in preparation for evaluating such trade-offs.

If there was any danger of your supply chain getting dull, this can certainly spice things up nicely.

I run into this with my working descriptions for negotiation strategies.
A couple of semantic challenges are:

- Even if you are not “a competitive person,” you can still pick a strategy of “competing” in a certain situation;

- It can make strategic business sense to “accommodate” the needs of others and you don’t have to be weak-kneed to do it;

- Collaborating with a party does not mean agreeing with them all the time, and you don’t have to be “nice” to do it.

I will suggest that collaboration is a default for supply chain initiatives, given that the relationships (internal and external) have to be maintained over a period of time and that, in today’s competitive (semantics again!) environment, there is no room for compromising the returns on time and dollars spent.

So do you have to collaborate all the time on everything? Not at all.

Before giving you the model, let me give you this:
Glossary of Terms

Information: Results, data, examples and findings that may help in determining a superior course of action.

Expertise: Orientation, experience and training that enable one to see relevant implications of a decision prior to its implementation.

Authority: Structural or informal power to direct the actions of others, coupled with accountability for the consequences of a decision.

If you have all three, there is no need to collaborate. Why would you? You have all the information you need, you know what is important for the decision, and your sphere of responsibility allows you to “make the call.”

This doesn’t mean that you have to be obvious about “going it alone,” but engaging others would be strictly for relationship-building. You will decide if this is worth the effort.

Tune in next month for an elaboration on what to do when you have “two out of three” (which “ain’t bad,” according to Meatloaf).

THIS ARTICLE FIRST APPEARED IN THE AUGUST NEWSLETTER FOR THE CANADIAN SUPPLY CHAIN SECTOR COUNCIL.