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I have just one question about Microsoft CEO Satya Nadella’s comments regarding women’s compensation: Did he deserve all the outrage?

Let’s start with his actual words:

Maria Klawe: What do you advise women who are interested in advancing their careers but they’re not comfortable with putting themselves up for promotions or advanced opportunities?

Satya Nadella: The thing that perhaps most  influenced me in terms of how you look at the journey or a career…There was this guy whose name is Mike Naples who was President of Microsoft when I joined, and he has this saying that all HR systems are long-term efficient, short-term inefficient.

And I thought that phrase just captured it. Which is…it’s not really about asking for the raise but knowing and having faith that the system will actually give you the right raises as you go long.

And that I think might be one of the additional “superpowers,” that quite frankly, women who don’t ask for a raise have. Because that’s good karma. It will come back. Somebody’s going to know that’s the kind of person I want to trust. That’s the kind of person that I want to give more responsibility to.

And in the long-term efficiency, things catch up. And I wonder whether taking the long-term approach helps solve for “Am I getting paid right?” Am I getting rewarded right?” The reality is the best work is not followed with your best rewards. Your best work then has impact, people recognize it, and then you get the rewards. And you somehow have to think that through.”

Opinion: The problem here isn’t that Nadella is insensitive to women’s realities. It’s that he’s insensitive to how things happen here on the planet I like to call “earth.”

The problem, that is, is that this isn’t how things actually work.

When an employee, male or female, does great work and that great work has impact, that doesn’t mean anyone in management will even know which employee deserves the credit.

Credit-stealing is routine in American business. Worse, or perhaps better, great work and impact are usually produced by a team. Balancing the importance of valuing team effort with the varying contributions of different team members is quite a difficult feat.

Also, Nadella seems to be implying that promotions and raises come from doing something that has a strong positive impact. I sure hope not. That’s what bonuses are for. Employers should give employees raises when they’re worth more in the employment marketplace, and promotions when they’re capable of a more responsible and valuable job.

What happens instead: When companies underpay employees the result is a short-term increase in profitability. And as accounting systems don’t have any way to represent the loss of talented employees on financial statements, the whole system is tilted in this direction.

The result: In the vast majority of corporations, employees don’t get what they deserve, they get what they negotiate, just like the ad in the in-flight magazines tells you.

Nardella’s response was, in many respects, thoughtful. The problem was that he failed to include something critical, namely, useful advice for the world as it actually is. A far better response would have been:

The situation for women at Microsoft … and at any other company, but I only have influence over Microsoft … should be exactly like the situation for male employees. What we’re striving for is that no employee should ever have to ask for a raise or promotion. We want every employee to be in a position they can succeed in, and that provides them with opportunities to achieve and grow. And we want to pay every employee what he or she is truly worth.

If we’re failing to do that for any employee, that employee should make her … or his … case and we should listen and make an objective judgment. We should give that employee a raise or promotion if one is warranted, and an honest response either way.

As a general rule, in U.S. businesses at least, men are better at negotiating these things than women. Worse, it’s considered okay for men to negotiate such things, much more so than for women who do the exact same thing.

And as the big three when it comes to compensation de-motivators are arrogance, disrespect and unfairness, it’s unsurprising that women, more than men, are likely to find their compensation de-motivating.

Were Mr. Nardella’s words disrespectful to women? I don’t think so. They were worse than that.

They were terrible advice.

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|In: Business Ethics|Last Updated:

“Device giants shed integrity agreements” read the 9/27/2014 StarTribune business section headline.

As explained in the article, an integrity agreement is a signed commitment that a corporation will, while the agreement is in force, obey the law.

Temptation is, for us Sarcastics Anonymous members, so, so hard to avoid. After all, we natural persons have to obey the law even when we haven’t signed an integrity agreement.

But it turns out that while integrity agreements really are evidence corporations aren’t people, too, this isn’t why. U.S. government agencies make use of integrity agreements, not to give corporations an obligation to obey the law, but in recognition that just because its CEO and board of directors want a large corporation to do something, that doesn’t mean it will.

Integrity agreements specify that signing corporations will implement organizational structures and processes designed to ensure they do obey the law — a compliance officer and committee; written standards and policies; a comprehensive employee training program and so on.

They’re recognition that corporations are different from us “natural persons” in a deep and fundamental way. Our brains don’t need committees or organ training programs to get our bodies to do what they’re supposed to do.

A few billion years of evolution have resulted in systems that let the brain control things because for us natural persons our tissues and organs all share a common set of interests. More or less.

Anyway, unlike us the “organs” and “tissues” that make up a business … its departments and employees and please don’t push the metaphor! … have very different versions of what self-interest means. Reducing the gap is one of the most important responsibilities business leaders have, and reducing the extent to which employees and departments act on the gap that remains is one of the most difficult.

What’s the solution? Processes and organizational structures, according to the federal agencies that require integrity agreements. Were we to be unkind we might call it bureaucracy, or perhaps the Compliance Police.

Not that we should sneer. In the turn-executive-intent-into-organizational-action game, business pundits and consultants of all stripes tend to converge on these answers, usually adding metrics as a critical element.

And all of these, with the possible exception of metrics, are important. They just aren’t the lead story. But first, a few words about the futility of metrics, in the form of a question: How exactly might a corporation measure its current level of law-breaking?

Not the number of lawsuits, indictments or prosecutions. These measure the number of times the company got caught, and even there the metric will lag the infractions by years.

Internal Audit? It has its hands full looking for accounting irregularities.

We’re talking about something that’s difficult and expensive — choosing a random sample of decisions and actions in all parts and at all levels of the company and digging into them to see which ones fail to adhere to the letter and spirit of all relevant laws and regulations.

Good luck with that.

Which gets us to the lead story: Culture change. It’s the lead story for most business changes — your takeaway from this tale of superficial absurdity.

Culture change is usually relegated to business change management — a follow-on complement to business process change whose role is reducing resistance to the desired change, whatever it is.

Business leaders need to change their thinking on this (me too). Culture is “how we do things around here.” According to ethnoscience it’s “the learned behavior people exhibit in response to their environment,” as my anthropologically-educated business partner explained it to me.

It’s a set of unwritten, socially enforced rules that determine how executives, managers and employees make decisions and act on them. It’s the lead story for most change, or should be.

Some companies rely on controls. But controls mean the answer is always no until you can persuade the controls committee (the word is “governance”) to change the answer to yes.

Controls are why corporations are slower than entrepreneurships. They’re why “I’d rather ask for forgiveness than for permission.”

In a very real sense, controls exist to prevent the corporate culture from taking charge of things.

How sad is that?

But what’s the alternative? In the case of obeying the law, it’s to bake compliance into the corporate culture. This make compliance the lines painted on the pavement and not the guardrails at its margins.

Which do you prefer to rely on to keep your car on the road?

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