BP’s new strategy: Tony Hayward isn’t gone, but they’re hoping he will be forgotten. Chairman of the board Carl-Henric Svanberg decided Hayward shouldn’t be turned into one of the small people just yet, because his primary sin was his impact on BP’s image.
Which tells me neither Hayward nor Svanberg has spent much time shopping at the Insight Store. Hayward needs to go, and as is so often the case with headline-making examples of lousy leadership, you can benefit from his ineptitude.
But only if you understand why he needs to go, and it’s a reason none of the commentariat has yet mentioned, probably because the commentariat, while paid lots of cash to bloviate, don’t actually understand anything about business leadership.
It’s a trait they share with Hayward — a conclusion that’s an inescapable inference once you listen to his testimony to Congress.
What the talking heads have been focused on is his tone-deafness and inept handling of the crisis. His tone-deafness isn’t in doubt. As for the inept handling, here’s the fact: Nobody knows what adept handling of this situation might look like.
Here’s how we know Hayward doesn’t understand business leadership: Asked about his role in creating the mess, he asserted that he had none. “I wasn’t part of the decision-making process,” he said, “I’m not a cement engineer, I’m afraid,” “I’m not a drilling engineer,” and “I’m not an oceanographic scientist.”
All of which is both accurate and irrelevant. He’s the CEO, paid more than $4.5 million in 2009. He is responsible for how the company runs. The tools he has at his disposal for doing so include: Setting the overall tone, style, and business culture; establishing the goals and priorities for which each executive is responsible; establishing the company’s risk profile (which is to say, what sorts of risk are and aren’t acceptable); and aligning executive compensation with all of the above.
And, he is paid to be excellent at organizational listening … to knowing What’s Going On Out There.
As an IT leader, so are you. Sure, the size of both your organization and your paycheck are one or two orders of magnitude smaller. All that changes are the difficulty and stakes. The subject matter is the same.
So take a minute right now to turn this into a personal checklist. Ask yourself:
- What do you do every week to define and implement the tone, style, and business culture you want?
- Can you envision serious potential side-effects from the goals and priorities you’ve set for each of your direct reports?
- Have you made it clear to everyone in your organization what risks and shortcuts are desirable, which you can live with, and which are only acceptable when practiced by your competitors?
- If your direct reports do exactly what you pay them to do, will the results be what you want? Or do you ask them to make a choice between doing what’s best for the organization and maximizing their annual bonus check?
- How do you know What’s Going On Out There? Are you confident you’re receiving accurate, unfiltered information that gives you an accurate picture?
Next: Decide how much time you’ll need to invest in each of these responsibilities to do a good job at it, and how often you’ll need to invest it. These things don’t happen by accident, they don’t happen by hoping they’ll happen, they don’t happen through good intentions, and they certainly don’t happen because you explain what you want once, in a broadcast e-mail or all-hands speech.
Effective leadership takes time. Which means your next step is to look at your appointment calendar, to find it. Chances are, you won’t be able to because your calendar is filled with appointments already, and your to-do list is similarly full of tasks that urgently need your attention.
That’s why they pay you the not-as-big-as-Hayward-gets bucks. Find the time. Decline appointments that don’t need your attention, or delegate them to a direct report whose judgment you trust and who deserves the visibility. Delete tasks whose importance is minimal regardless of their urgency … or delegate them as well if they can’t just go away.
Find the time, and use it to lead more effectively.
Hayward needs to go because he has made it clear, repeatedly and publicly, that he doesn’t understand his job.
If we learn from his mistakes, we get at least some benefit out of the deal. Since we’re all going to pay the price for his incompetence, it seems only fair.
What a great article. As usual, Bob, you hit the nail right on the head. The one most important characteristic of leadership is the ability to take responsibility for problems and issues. (And, of course, give away the credit when things go well.)
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Exactly. I told my son when we were listening to Hayward’s comments, that the fact the media is focusing on him not taking responsibility means nothing. He in congress, under oath, if he admits responsibility, its admissible in court for every civil case that will be brought against BP. I told him what is completely unacceptable is that he claimed to “not know what is happening at his company.” WHAT??!! He’s the CEO, the buck stops at his desk right? Thats what CEO’s get paid the big bucks for right? Oh, its not, then why do we pay CEO’s the big bucks? That’s the real answer that the power brokers and their government backers don’t want to see us asking.
Everyone is so amazed at Steve Jobs and the job he does running Apple. Well, like him or not, he does know about everything his company is doing and why they do it. Most CEO’s should be like that, but far far to many aren’t worth even a penny of their salary.
And to think that Steve Jobs is only paid $1.
(OK, so we all know that is his official “salary”, and he is generously compensated in other ways.)
It’s one thing to admit that you don’t know, that you as CEO of a corporation don’t have the munute details of how a deep water oil rig operates. But you damned well DO employ a few hundred that do, and can get you answers in seconds. Have your Uber Data-Weenie sitting right next to you drilling your data to get the right answer… RIGHT N-O-W…
Unfortunately, most business and political “leaders” will learn nothing from this situation other than how to dodge a bullet.
The main tool used by executives today is PRESSURE on subordinates to JUST DO IT. They are too busy responding to pressure from the CEO and/or company President (if they happen to be different people) to learn the business and provide coherent leadership. Empty headed decisions that hurt the business are the norm.
I think Hayward understands his job admirably. “Drill baby drill is the mantra he follows–he just can’t say that in public in the halls of Congress so he sits there and pretends he did not do his job admirably well. Stockholders do not get dividends from safety meetings.
As far as IT is concerned, the main thing is to listen to the experts you hire and not overrule them or dismiss their concerns without thought.
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Bob, for a moment there I felt I was reading Tim Ferriss: “Decline appointments that don’t need your attention, or delegate them to a direct report whose judgment you trust and who deserves the visibility. Delete tasks whose importance is minimal regardless of their urgency … or delegate them as well if they can’t just go away.”
… a good solid start to bringing a halt to the busywork madness and having time to do what really needs to be done.
From my point of view – one lesson is that the higher up in a business you are, the more you need to understand the implications on one part of the business of what is happening in another part of the business because no one else knows what is going on in both areas.
If the 2 are in the same area – then someone lower down should be aware of the implications. Thus, he should have either been aware of the implications or had the lower manager in the room with him. The reason he didn’t is obvious – the lower level person who understood implications would have said something similar to “I heard him say to cut costs, so I cut costs where I could – which meant I had to jeprodize safety – because I could not cut anywhere else. I understood that implication, but I was going to loose my job if I didn’t cut costs, and I knew my replacement knew less about the risks than I did.” Hayword doesn’t want to hear that because that might bring out documentation that he doesn’t want out in the open.
There is also the issue of admitting liability to worry about – but I believe there’s enough evidence to convict already. If he had been smart, he’d have asked for immunity from prosecution for his words during his testimony, then told the absolute truth as he understood it – but I suspect the English courts wouldn’t agree to immunity for testimony in the U.S. and vice versa – the problem of a multi-national company. Hmmm – now there is a possibility for an article/rant.
Bang on! Kind of like when Obama said “Such decisions are above my pay grade.” When you are The Boss there is no such thing.